Press Promotion to President a First for Toyota America

Toyota has made a wise decision in tapping James Press as president of Toyota in North America to replace Hideaki Otaka.

Press’ promotion not only marks the first time an American has been named president of Toyota Motor North America, the Japanese parent’s New York-based holding company, but it restores credibility to the upper ranks and brings a semblance of order to a deeply embarrassing turn of events.

It also is significant because the Japanese rarely name a non-Japanese executive to lead their companies. While Carlos Ghosn may be the exception at Nissan, French auto maker Renault holds a major stake in the Japanese car maker.

Otaka recently came under fire when his former assistant filed a multimillion-dollar sexual harassment and employee discrimination complaint in a New York court against him and also Toyota for allegedly not taking disciplinary action against him.

He was scheduled to return to Japan at the end of June but instead gave up his position, saying he expects to be “fully vindicated.”

Press, 58, is well known and respected in the U.S. and Japan. He has served Toyota’s U.S. sales division as executive vice president and chief operating officer since 2001 and has been with the auto maker since 1970. He was appointed to president of the division last year.

He also is highly regarded as a “car guy” among U.S. dealers and has been a fierce proponent for hybrid-electric vehicles here, expanding Toyota’s HEV lineup on the back of success enjoyed by the Prius.

Industry skeptics say hybrids do not deliver their promised fuel savings and buyers will not recoup the extra money paid for an electric motor.

However, proponents say Toyota is a moving target primarily due to its seemingly unstoppable success.

Indeed, the recent sex scandal surfaces just as Toyota is poised to overtake GM as the world’s second-biggest vehicle maker. The auto maker this week reported a 53% gain in its fourth-quarter fiscal operating profit and last month for the first time outsold DaimlerChrysler in light-vehicle sales year-to-date, giving it a No.3 ranking.

Toyota’s U.S. market share through April stood at 14.2%, compared with GM’s 24.0% and Ford’s 18.3%, according to Ward’s data.

Toyota in the U.S. sold a record 2.06 million cars and trucks last year and reportedly has said its goal is to reach 3 million sales annually in the U.S., giving it an 18% share of the American market by 2010.

As a means toward that end, Toyota this year is in the midst of a new product blitz, including a redesigned, more powerful Camry and Tundra fullsize pickup truck. Press said in February the new Tundra was expected to sell 200,000 units in its first full year. That’s an ambitious goal given today’s fuel costs.

What is not up for debate is that Toyota will require steady leadership both in the U.S. and Japan if it hopes to reach the top of the auto industry’s pecking order, and Press has the credentials to help steer it in the right direction.

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