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Honda, battling global crisis, names Ito as CEO

Fukui, 64, will complete six years at the helm and become an executive adviser to Japan’s No.2 automaker as it, like the rest of the industry, faces a frozen credit market that has sent sales skidding.

Honda’s shares extended losses after the news, trading down 4.5 percent at 2,145 yen.

Ito, 55, is currently in charge of automobile operations, having followed a career track that many saw as leading to the top post. Like Fukui, he previously headed Honda R&D Co, the carmaker’s research arm.

Ito will head Honda R&D once again in April and take over the CEO’s job in June, holding both positions, Honda said in a statement.

Among other achievements, Ito, an easy-going and outspoken engineer, is credited for developing the world’s first mass-produced all-aluminium-body car, the NSX sports car, which went on sale in 1990. He joined the company in 1978.

Fukui, a motor racing fan who announced in December his firm would pull out of Formula One racing, steps down at a critical time for Honda.

Automakers everywhere are grappling with plunging sales and Honda will be fighting an uphill battle against losses in the new business year from April, as a strong Japanese yen adds to the pain when profits are repatriated.

The Japanese currency traded around 93 per dollar on Monday, not far from a 13-year high near 87 per dollar hit in January.

But thanks to its more cautious and measured business approach, Honda is still expecting to stay in the black for the year to March 31, unlike rivals Toyota Motor Corp and Nissan Motor Co.

With sales crumbling in the main markets of the United States, Europe and Japan, Fukui reluctantly pulled out of Formula One racing to channel the funds instead to the development of a new generation of cars.

He also resisted building a car factory in Russia when most rivals took the plunge when sales there were soaring last year. Car sales in Russia have since reversed, falling by double-digits in the past few months.