Toshiba’s U.S. Subsidiary Has New President : Departure: Irvine-based unit, which has had problems with its portable computer business, is replacing the man who engineered the company’s leadership role in that market.
Toshiba America Information Systems, struggling to recover from a series of costly mistakes in its cornerstone portable computer business, has appointed a new president to replace the man who created that business.
Atsutoshi Nishida, 48, who headed Toshiba’s international computer marketing and who has spent much of his time in Irvine during the past year, took over Monday as president of the U.S. subsidiary of the Tokyo-based computer and telecommunications company.
He replaces Kiichi Hataya, 51, who engineered the company’s leadership role in the $3-billion portable computer market and has run the Irvine-based company since 1988.
Linda Bell, a spokeswoman for Toshiba America, declined to say whether Hataya’s departure is related to the subsidiary’s problems. She said typical terms of duty for overseas Japanese executives are three years, while Hataya had stayed in the United States for five years.
Hataya has ridden a roller coaster from the start. In 1985, while still in Japan, he was ordered to shut down Toshiba America’s unprofitable computer business.
But he persuaded his superiors to wait until they could judge the impact of a last-ditch product: the laptop computer. Hataya’s intuition was right, and Toshiba captured the lead in the exploding laptop market.
In 1988, Hataya was sent to Irvine as president of Toshiba America.
Two years later, he was confidently projecting that the company would employ 3,000 people in the United States by March, 1992. But employee cutbacks have been the norm. Hataya also said in 1991 that he liked the California lifestyle and hoped to stay.
But he will return to the parent company in Tokyo as assistant to the general manager for the international operations-information equipment division.
Neither Nishida nor Hataya was available Monday for comment.
As president, Nishida will emphasize the development and marketing of leading-edge office automation equipment and notebook computers, company officials said.
The company credits Nishida with strengthening the computer division’s emphasis on research and development--leading to the introduction of a series of notebook computers that have received numerous industry awards during the past nine months.
“I am assuming my position at a time full of opportunity,” Nishida said in a statement issued Monday. “The restructuring and streamlining we have accomplished over the past year has put us in an ideal position.”
The change comes at a time when Toshiba America’s computer division has seen its market share in the portable computer business plummet to 14% from 20.1% in 1990, according to International Data Corp., a market researcher in Framingham, Mass. The company still ranks number one in the portable market, however.
With Hataya at the helm, Toshiba America pioneered the portable computer market in the mid-1980s. The company since has branched out into making copiers and telecommunications equipment, butportable computers still account for half of the company’s estimated $1 billion in annual sales.
During late 1990, however, an explosion in demand for notebook computers--which weigh less than eight pounds and fit inside a briefcase--caught Toshiba off guard and left it floundering in the market with older products that were considered obsolete and more expensive than offerings from new rivals like AST Research Inc. in Irvine.
As a result, Toshiba’s computer sales fell sharply in the first half of 1991.
The company laid off 12% of its employees early last year and revamped its distribution several times--all at a time when dozens of competitors began manufacturing their own portable computer models based on a new generation of semiconductor technology.
The problems became public a year ago when Bill Johnson, general manager of the computer division, abruptly resigned. Toshiba America acknowledged that it had a huge inventory of unsold computers and shut its factory for two weeks in June, 1991, in order to eat up some of that inventory.
Since then, analysts say, Toshiba America has been in a recovery. In October the company brought in Michael Winkler, a former Xerox Corp. executive, to replace Johnson.
And during the past nine months it has introduced a raft of new computers, including a color notebook computer last month, aimed at replacing desktop computers as the primary tool for business computer users.
However, the recession and an overall glut of product in the portable computer market has forced prices down 40% in the past year, taking a toll on Toshiba’s attempts to recover.
Toshiba’s Dwindling Market Share While Toshiba Corp.’s share of the portable computer market has slipped since 1989, others, including newcomers IBM and AST, have made headway. Toshiba’s Market Share Percentage change in Toshiba’s market share of portable computers from previous year:
1991: -30.3% 1990: -7.8% 1989: +23.9%
Market Share
1991 1990 Toshiba 14% 20% Compaq 11% 15% IBM* 4% Tandy/Grid 9% 13% Bull/ZCS 8% 10% Bondwell 5% AST* 5% TI 4% NEC 3% 4% Others 37% 38%
* New to the market
Source: International Data Corp.
