Pixar chief asserts his authority over Disney by axing 'Toy Story 3'

To infinity but not beyond as merger brings successful series to an end

John Lasseter, the creative chief of Pixar Animation Studios, has wasted no time asserting who is boss after Pixar's takeover by Walt Disney - by stopping production of Toy Story 3, the controversial sequel to the two wildly successful animated films.

The original Toy Story, completed in 1995, was the first major collaboration between Pixar and Disney. Thehighly lucrative partnership went on to produce the hits Toy Story 2, A Bug's Life, Finding Nemo, Monsters Inc and The Incredibles.

However, the joint venture became strained, partly because of personality clashes between the then Disney chief executive, Michael Eisner, and Pixar's chief executive, Steve Jobs, and partly because of Disney's desire to keep the Toy Story franchise running with a third and forth movie.

Mr Lasseter was deeply opposed to the idea but Disney went ahead, as it owns the intellectual property, putting 100 scriptwriters, animators and other creative staff to work on Toy Story 3 at its own Walt Disney Studios animation complex in Burbank, California.

On Wednesday, less than 24 hours after Mr Jobs and Disney's new chief executive, Bob Iger, unveiled the merger, Mr Lasseter went to Burbank with Pixar's president, Ed Catmull. He announced that Toy Story 3 would now be scrapped, without a word about the fate of the animation team.

According to talk in Hollywood, Disney was struggling with a script in which Buzz Lightyear, one of the two stars, developed a fault and had to be recalled to Taiwan for repairs.

According to regulatory filings in the US, the Disney-Pixar deal gives Mr Lasseter creative control over all of the two studios' animated film output, while still maintaining Pixar's independence. He also has a contract running to 2011 paying him a salary of $2.5m (£1.4m) a year.

Pixar's latest movie, Cars, will shortly be released, while Disney is apparently relieved at the success of its own new animated film, Chicken Little, which comes out in the UK next month.

Chicken Little has already made more than $250m at the box office.