The NEWSWEEK 50: Katsuaki Watanabe, Toyota

Katsuaki Watanabe is not looking for a bailout from anybody. Sure, the straight-talking president of Toyota is weathering the same storm buffeting all the world's automakers. Toyota's sales are down, especially in the United States, its largest, most profitable market. That's why Watanabe has slashed bonuses, staff and spending, while ratcheting down his 2008 profit projection to one third of what Toyota made last year. But that's the difference between Toyota and Detroit—even in a bad year, Toyota expects to make $6 billion, not suffer the Hummer-size losses that sent Motown's CEOs begging to Washington.

While Watanabe, 66, carries more clout in the global auto industry than anyone else, he doesn't want to focus on Toyota's success. He'd rather focus on its flaws. So when Toyota, which he took over in 2005, suffered a series of embarrassing recalls early in his tenure, he declared a "crisis" and made a public apology. Now that an economic crisis has hit, he's even more urgent. "We are facing the most serious emergency that we have ever faced," he told top managers recently.

Instead of slashing and burning, though, Watanabe is being surgical in what he cuts and what he keeps. Two new research centers in Japan—one for hybrid cars, the other to improve Toyota's world-beating manufacturing system—are sacrosanct. And at an austere Detroit Auto Show in January, Toyota will make noise with a new version of its white-hot Prius. He's already unleashed a rival to the popular Smart car: the nine-foot-long Toyota iQ microcar, on sale in Japan and coming to Europe in 2009 (and maybe the United States later). So as other automakers struggle to survive, Toyota's crisis captain is maneuvering his company to emerge from the wreckage as the world's undisputed car champion.