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Toyota knighthood is dubbed an insult

The man who persuaded Toyota Motors to invest £840m to build its first car factory in Britain is to receive an honorary knighthood from the Queen. An announcement that Eiji Toyoda, honorary chairman of Toyota Motors, is to be knighted "will be made very soon", a British government official told the Independent. Unlike the knighthood given in 1990 to the former head of Nissan Motors, Takeshi Ishihara, the honouring of Mr Toyoda is bound to spark criticism within Britain and Japan. Michael Heseltine, President of the Board of Trade, who is heading a British export mission to Japan, yesterday held a "courtesy meeting" with the 81-year old Mr Toyoda at the company's Nagoya headquarters.

Mr Toyoda was chairman in 1989 when Toyota Motors decided to manufacture cars at Derby, where production started in 1993. Toyota is the biggest Japanese car maker, as well as being one of the richest and most profitable of all Japanese firms.

"After the head of Nissan was given a knighthood it was always understood that the head of Toyota would be next in line, but we had to allow a decent interval," said the British official. Mr Ishihara was President of Nissan, arch-rival of Toyota, when itannounced in 1984 its intention to open the first Japanese car plant in Britain.

But the impending knighthood of Mr Toyoda will only rub salt into the wound of Honda Motors, which is still smarting from the British government's decision to sell the Rover Group to Germany's BMW without, it is claimed, properly consulting Rover's longtime Japanese partner. Honda's joint manufacture of cars with Rover in England had won praise and had been essential to Honda's European strategy. Honda officials complain that they feel betrayed by the sale of Rover to BMW, which one described as a "stab in the back".

The honouring of Mr Toyoda is also certain to anger former British prisoners of Japan during the Second World War, who on Monday began a court case with Commonwealth and US veterans against the Japanese government in pursuit of compensation.

Toyota Motors was one of several large Japanese corporations and financial institutions which received an invitation last year requesting that one of their senior executives meet Sir Kit McMahon, the former chairman of Midland Bank and former deputy governor of the Bank of England. Sir Kit made a secret visit to Tokyo in November at the behest of the Foreign Office to solicit donations to a charitable trust to aid former Commonwealth prisoners of Japan. None of the Japanese businesses agreed to meet Sir Kit. A spokesman for Toyota Motors said last night that he was "unable to find any record" pertaining to the visit by Sir Kit.

Mr Heseltine said on Monday: "I will no way distance myself from the feelings of the former prisoners of war. History is history. Facts are facts. There is bound to be an immensely emotional and difficult set of discussions as the consequence of such events. I can only repeat that I will no way distance myself from the Brits involved in such circumstances."

In his autobiography published in 1985, Toyota: Fifty Years in Motion, Eiji Toyoda details how the company, which included spinning and weaving works and an aircraft factory, made an important contribution to Japan's war effort before 1945.

Mostly, Toyota supplied trucks to the military, but it also built combustion chambers for a prototype jet engine - "the original plans were brought in from Germany by submarine" - and "unmanned plywood boats ... packed with explosives and launched at enemy ships".