Akio Toyoda, grandson of Toyota Motor Corp.'s founder and the company's next president, will confront a challenge largely unknown to his ancestors — decline.
Toyoda, 52, will succeed Katsuaki Watanabe, 66, as president of Toyota this year, sources have said. He will take over as the carmaker's two largest markets, the United States and Japan, are plummeting, forcing Toyota to reduce inventories by halting production. The company plans to slash about 5,000 temporary workers in the two countries in the face of its first operating loss in 71 years.
"The company's path of rapid growth until now is unsustainable," said Takashi Aoki, who helps manage about $1.3 billion at Mizuho Asset Management Co. in Tokyo. "Now, it faces shrinkage and possibly the need to get out of some businesses."
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