The two top executives of Japanese electronics company Pioneer will step down from their positions following poor business results and predictions of a financial loss this year, the firm's board decided on Monday.
Kaneo Ito, Pioneer's president, and Kanya Matsumoto, the chairman, will lose those positions on 1 January 2006, the company said in a statement. Ito will be replaced by Tamihiko Sudo, currently an executive vice-president at Pioneer. No successor has been named for Matsumoto. Both will stay with the company: Ito as an advisor and Matsumoto as a director.
"This change in management is an indication of [Ito and Matsumoto] assuming responsibility for the steep decline in Pioneer’s financial performance due to the smaller-than-planned number of units sold of plasma displays and DVD recorders - both strategic products," the statement said.
Flat-screen TVs and DVD recorders, both of which are major product lines for Pioneer, have seen increased market competition, and this has been pushing down prices and consequently hurting the company, it said in October when it announced its half-year results.
Pioneer reported a ¥12.3bn (£60m) net loss for the six months from April to September this year, compared with a ¥4.8bn (£23.5m) net profit in the same period last year. For the full year the company expects a net loss of ¥24bn (£117m) against a net loss of ¥8.8bn (£43m) last year.
Sudo, the new president, joined Pioneer in 1970 and in the late 70s and 80s held positions at the company's European subsidiaries. In 1994 he joined the division responsible for car audio and entertainment products and rose to become vice-president of mobile entertainment operations in 2004. Since June 2005 he has been in charge of corporate strategy.
The replacement of a top executive in response to poor results hasn't been unusual in Japan recently. Earlier this year both Sony and Sanyo made similar moves. Sony hit the headlines with the appointment of Howard Stringer as its first non-Japanese head, while Sanyo attracted attention for hiring a woman, Tomoyo Nonaka, as its new chairman in a country where women are still rarely found on company boards.