LOS ANGELES -- George Borst, CEO of Toyota Financial Services for the past 13 years, plans to retire from Toyota at the end of September, he told a meeting of top Toyota and Lexus dealers last week.
He will be replaced by Mike Groff, 58, head of Toyota Financial Services' sales and marketing for the past five years.
Borst, who will turn 65 on Sept. 2, presided over massive growth in Toyota's finance arm -- from about $21 billion in assets in 1997 to $91 billion today, with operating income jumping sixfold in the period, to $1.8 billion. Toyota's share of its dealers' finance business has soared from 37 percent in 1997 to 64 percent today.
Borst was hired in 1985 by former Toyota Motor Sales U.S.A. executive Bob McCurry to oversee the marketing department, a post that evolved into running Toyota's strategic planning department in 1991.
But his biggest challenge may have been as general manager of Lexus Division, a job he assumed in 1993. During his tenure, the dollar collapsed against the yen, making the cost of Japan-built vehicles sold in America much more expensive. The yen went from 115 to 80 to the dollar by 1995, and Lexus' launch momentum was derailed.
"I am most proud of my time at Lexus," Borst said in an interview. "When we started to struggle, we could have had bargain-basement sales and eliminated all those customer handling touches. This was our first test of who we were. And in 1995, even as our sales volume had dropped, we still swept the J.D. Power awards."
Borst's move in 1997 to Toyota Motor Credit Corp. puzzled some Toyota insiders because of his lack of experience within the finance arm. At the time, even Borst admitted he was a bit at sea. But his background in strategic planning helped meld an organization that has become a financial powerhouse.
In 2000, Toyota Motor Corp.'s 16 separate finance arms worldwide were absorbed by a new global finance unit called Toyota Financial Services Corp. Borst was named CEO of Toyota Financial Services U.S.A.