Toyota has dealt Saatchi & Saatchi a hammerblow

Toyota has dealt Saatchi & Saatchi a hammerblow by moving the lion's share of its £50m UK advertising business into CHI & Partners.

The Japanese car marque is Saatchi's second-biggest global account behind Procter & Gamble, spending $2.5bn (£1.75bn) a year, and the UK is its biggest single European market.

It is thought that CHI, which sold a 49.9% stake in the agency to WPP earlier this year (MW April 19), will be handed the majority of the UK business in the coming weeks after a pitch against incumbent Saatchi London.

CHI has been making inroads into the Toyota account since 2004, when it was appointed to handle the launch of the Aygo model across Europe. The agency has since won pan-European briefs for the Corolla and the Yaris and handles Toyota's luxury brand Lexus across Europe. However, the only UK-specific project it had won until now was Toyota¹s tactical advertising business at the start of last year.

The news comes as Saatchi struggles to find a UK chief executive to replace Lee Daley, who left to join Manchester United as commercial director in March. Sources claim Saatchi's EMEA, Asia and Latin America chief executive Jim O'Mahony, who has been leading the search for Daley¹s replacement, could now be handed responsibility for the UK agency on top of his other duties.

Toyota's decision to move the majority of the UK account out of Saatchi follows several changes to the company's senior team in the last year.

Its former European marketing director Jon Williams moved to Toyota GB as commercial director earlier this year (MW January 18) to replace Paul Philpott, who left to join Kia UK as managing director. Toyota GB's long-serving managing director Graham Smith left to take a new role with Toyota Europe last year (MW May 11, 2006).

A source close to WPP says that the company's chief executive Sir Martin Sorrell has been tracking the Toyota business for a number of years and that CHI¹s presence on its roster was a primary reason he bought the stake in the agency.

However, industry experts suggest that the Toyota news will not sit well with the Japanese marque's rival Ford, one of WPP's biggest clients.

Publicis-owned ZenithOptimedia handles Toyota's media planning and buying.

It is not clear if the CHI appointment will affect that relationship.

CHI founding partner Johnny Hornby denies the agency has won the UK account and plays down suggestions it will take a more prominent role in Europe and possibly in the US. He says: "As we understand it, it's business as usual in the UK and we haven't won the business in Europe or America, as much as we¹d love to one day." Toyota GB marketing director Mark Hall adds: "As of today, we are still working with both Saatchi & Saatchi and CHI. For the next few months, there will not be any tangible change. Beyond that, we'll see." Saatchi was unavailable for comment as Marketing Week went to press.

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