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Shiochiro Toyoda, who turned Toyota into global giant, dies at 97

Shoichiro Toyoda, the second-generation leader of Japanese auto giant Toyota, who oversaw a major U.S. expansion in the 1980s with manufacturing plants and ambitious goals as Detroit’s carmakers struggled with the punishing realities of global competition, died Feb. 14 at 97.

Toyota confirmed the death but did not provide further details.

Paul A. Eisenstein, editor of automotive news site the Detroit Bureau, said Mr. Toyoda took over Toyota when it was a struggling Japanese brand in the 1950s and, within three decades, brought in assembly-line techniques and quality-control standards that became the industry pacesetter.

Mr. Toyoda reinforced a devotion to detail that remains ingrained in Toyota corporate culture. A study by Harvard Business Review noted that Mr. Toyoda’s rules included turning off the company lights at lunchtime to save money and designing offices to take every inch into account for maximum use and cost benefit.

As Toyota’s plants expanded outside Japan, Mr. Toyoda rigidly enforced company’s “just-in-time” inventory philosophy that had factories able to shift production models quickly to respond to shifting consumer demands.

Yet he also could make bold and unexpected moves. In 1990, he upended the structure of middle management, taking away staff and subordinates to make the executives deal directly with lower-level workers. The move reflected his belief in “genchi genbutsu,” or the importance of seeing things firsthand.

“We felt we suffered from large-corporation disease, … so we embarked on a cure,” Mr. Toyoda said. “We have a saying: ‘A large man has difficulty exercising his wits fully.’”

In 1999, shortly before he stepped down as chairman, Mr. Toyoda assembled all of the company’s executives to berate them for adopting a more U.S.-style of worrying about the next fiscal quarter than focusing on longer-term goals.

“He began when Toyota was all but a joke,” Eisenstein said, “and turned it into a company that had to be taken incredibly seriously.”

Under Mr. Toyoda’s leadership, Toyota grew its presence worldwide to join the top ranks of global car brands by the late 1980s and become one of the flagships of the Japan Inc. economic powerhouse.

Toyota’s U.S. push, however, did not come with a big welcome mat. Japanese auto imports were convenient scapegoats for the declining fortunes of the U.S. car industry — hit by successive blows including higher labor costs, lack of Rust Belt factory innovations and consumers seeking smaller, higher-mileage cars after the 1970s gas shortages.

At the same time, Toyota and other Japanese carmakers were building reputations as simply more reliable and durable than the models from Detroit’s Big Three.

“Japan bashing” took on a literal meaning at times. Some protests included smashing a Japanese-brand car. At one event in 1982 in Indiana, it cost $1-a-swing to whack at a Toyota to raise money for laid-off autoworkers.

Amid this atmosphere, Mr. Toyoda treaded cautiously and cooperatively. Toyota struck a deal with General Motors in 1983 for a joint venture in Fremont, Calif., that produced the Chevrolet Nova and the Toyota Corolla.

When Mr. Toyoda came to Georgetown, Ky., in 1985 for the groundbreaking of Toyota’s first independent U.S. plant, he opted for forgo the traditional Japanese ceremony of breaking open a cask of sake. Instead, he toasted with local bourbon and noted that Toyota’s system of quality control was inspired by an American management theorist, W. Edwards Deming.

Mr. Toyoda also kept his comments surprise-free. When he spoke publicly, it was often in general aphorisms, particularly when asked about politically sensitive issues such as trade policies and union labor.

“We feel that if it will contribute to remedying the problem,” he once said about the Kentucky plant and complaints about Japanese auto imports, “we will be happy indeed.”

Toyota’s Japanese rivals such as Nissan and Mazda were years ahead in producing cars on U.S. soil. But Toyota’s growing dominance and aggressive growth strategies under Mr. Toyoda often made the company the center of debate over Japan-U.S. competition.

Mr. Toyoda presided over big victories.

He guided development of the luxury-brand Lexus onto global markets in 1989, which quickly challenged similar models of Mercedes, BMWs and other high-end models. At one point in 1990, the Lexus waiting list in the United States was a year-long.

Toyota beat everyone with the first hybrid car, the Prius, released in Japan in 1997 (and abroad in 2000). The hybrid Ford Escape debuted in 2004.

Mr. Toyoda also approved Toyota’s first assembly plant in Europe — in Burnaston, England — and its first in Canada in Cambridge, Ontario.

In 1980, Toyota’s U.S. market share was 6.6 percent. By 2009, it reached 16.7 percent before falling back to about 15 percent last year, according to industry data.

Shoichiro Toyoda was born Feb. 27, 1925, in Nagoya, a coastal city between Tokyo and Osaka, the son of a family with prominent business lineages.

His mother, the former Hatako Shinshichi, was a daughter of the co-founder of a prominent department store chain, Takashimaya. His father, Kiichiro Toyoda, branched off from the family’s successful automated loom company to found Toyota Motors.

The company says Toyota was picked as a name because it takes eight strokes to make “Toyota” in Japanese and that is considered a lucky number, but others suggest it was because Toyoda, which means ”abundant rice field,” was deemed inappropriate for a carmaker.

Mr. Toyoda was conscripted into a civil service job during World War II, and the company, like many others, was under orders to produce vehicles for the military. He graduated in 1947 from Nagoya University with a degree in engineering, and received a doctorate from Tohoku University in 1955. He was sometimes called “doctor” by Toyota colleagues.

Mr. Toyoda’s first job at Toyota was inspecting cars returned because of defects. He was named a managing director in 1961 and, in 1981, took over Toyota’s sales operations. A merger of sales and production units the next year created Toyota Motor Corp., with Mr. Toyoda installed as president.

He served as chairman from 1992 to 1999, and then became honorary chairman.

In 2007, Mr. Toyoda was inducted into the U.S. Automotive Hall of Fame. Mr. Toyoda was lauded for cementing “Toyota’s reputation as one of the most recognized and celebrated auto manufacturers in the world.”

Last month, Mr. Toyoda’s son and successor, Akio Toyoda, announced he was stepping down as Toyota president and would become chairman. Full details on survivors were not immediately available.

In speeches for American audiences, Mr. Toyoda liked to recount how a road trip across the United States in 1957 helped change his company for the better.

He was given the assignment of driving Toyota’s four-cylinder sedan, the Toyopet Crown, around the country. The Crown, marketed as a model for budget-conscious families, was Toyota’s first U.S. export, and Mr. Toyoda thought it might do well.

It was flop. In the era of big American cars and big American engines, he said, consumers thought the Crown lacked power and felt rattly.

A humbled Mr. Toyoda took the lesson to the factory floor, encouraging workers to make suggestions on better production methods and ways to address possible design flaws.

“We owe a great deal of thanks to America for our sense of the importance of quality,” he said.

*This story has not been edited by The Infallible staff and is auto-generated from a syndicated feed.