Westinghouse CEO tapped to lead Toshiba’s energy subsidiary
Westinghouse Electric Co. Chief Executive Danny Roderick has been chosen to lead parent company Toshiba Corp.’s energy business, part of a massive restructuring at the Japanese electronics giant as it looks to move past an accounting scandal.
Roderick, president and CEO of Cranberry-based Westinghouse, has been nominated to be president and CEO of Toshiba’s Energy Systems and Solutions Co., Westinghouse spokeswoman Courtney Boone confirmed Thursday. A shareholder vote to confirm his promotion is scheduled for June.
The subsidiary oversees all of Toshiba’s energy businesses — nuclear, thermal, renewable, and distribution — and includes Westinghouse, which employs 3,800 in Western Pennsylvania.
Roderick, who declined a request for an interview, has been Westinghouse’s chief executive since September 2012 and has more than three decades of experience in the nuclear industry.
Roderick is a well-regarded and politically connected executive who has steered Westinghouse’s nuclear business through a challenging period, not only for its parent company but for the nation’s nuclear industry, said Chris Gadomski, lead nuclear analyst at Bloomberg New Energy Finance in New York.
The rise of natural gas as a cheaper source of energy and concerns about public safety after the Fukushima Daiichi nuclear disaster in Japan in 2011 have led some nuclear plants to shut down.
Meanwhile, Westinghouse has forged ahead on building new plants. Eight AP-1000 nuclear reactors are under construction: two in South Carolina, two in Georgia and four in China.
“He’s led Westinghouse to build the first new reactors to come on line in the U.S. in many years,” Gadomski said. “He’s an executive that gets things done.”
Roderick’s appointment comes amid a batch of leadership changes for Toshiba, a Japanese conglomerate that makes products ranging from laptops to nuclear reactors, after it acknowledged overstating profits for several years. The accounting scandal led to the resignations of top-level officials, including the former chief executive and his advisers. Toshiba last week named Satoshi Tsunakawa, an executive vice president with the company, as its CEO.
Toshiba has slashed thousands of jobs and sold off parts of its business as it tries to move past the accounting scandal. It created the Energy Systems and Solutions Co. this year to oversee all of its energy companies, including Westinghouse.
The company, which bought Westinghouse in 2006 for $5.4 billion, wrote down $2.3 billion of the Cranberry-based nuclear unit’s value as it continued to address doubts over its bookkeeping. The writedown and restructuring costs related to the accounting scandal contributed to a $4.4 billion annual loss Toshiba posted Thursday for its most recent fiscal year, which ended March 31.
The nuclear industry has deteriorated since the Fukushima disaster. In late 2014, Roderick told the Tribune-Review that he still believed there were opportunities to break ground on more plants in the United States. But competition from cheaper natural gas makes it even more unlikely that nuclear power has much of a future here, said Charles Fishman, a Morningstar analyst.
“I don’t see any more nuclear plants being built here because of our shale gas revolution,” Fishman said.
Roderick has looked for power plant business in international markets and has emphasized servicing and fueling reactors as a way to help mitigate the downturn in the nuclear power industry that has hurt the company.
Westinghouse increasingly looked to the United Kingdom, China and former Soviet bloc countries as more realistic customers for its AP-1000 reactors. Roderick told Reuters in March that he expected to sign a deal in June to build six reactors in India.
If shareholders approve his promotion, Roderick would step down as Westinghouse’s CEO and be replaced by Jose Gutierrez, the senior vice president of nuclear fuel and components manufacturing, Boone said. Gutierrez would become acting CEO while a search committee looked for Roderick’s permanent replacement.
Roderick was also named chairman of Westinghouse’s board of directors, a title he would keep as CEO of Energy Systems and Solutions Co. And though he will be a “global traveler,” Roderick will maintain a presence in Pittsburgh, Boone said.
“He’s not giving up his house,” she said. “He’s not giving up his Pirates tickets.”
Chris Fleisher is a Tribune-Review staff writer. Reach him at 412-320-7854 or [email protected].