Exiting passenger cars for trucks and diesel (1992)

Where to concentrate strength, over the pride of a storied name

The heart of this decision lies less in the financial crisis itself than in the fact that Seki, president for only a short time, squarely wound down the passenger-car business that a storied maker’s pride had been unable to let go. Keep making passenger cars and engineers will gather; recreational vehicles need passenger-car technology — successive presidents had said as much and kept postponing withdrawal. Seki, prepared to write off $359.8M (¥40bn) to $449.7M (¥50bn), broke that chain and gathered resources onto Isuzu’s own strengths, trucks and diesel. Precisely because he was a man who had long watched the problem from the staff side, one can read it as his refusing to miss the moment of taking office to cut in.

The hardest obstacle was persuading GM — the largest shareholder, and also a customer for the passenger cars. Rather than bend to the foreign parent’s wishes, Seki showed where Isuzu’s strength lay and turned GM into an ally. After the withdrawal, Isuzu was reborn as a specialist in commercial vehicles and diesel engines, growing into a global truck-and-diesel maker that, in the 2020s, would stack up record profits. Which business to concentrate one’s own strength in, rather than chasing scale — Isuzu’s exit from passenger cars is one example of selection and concentration that answered that question head-on.