Why Subaru is worried about its soaring sales
The company's vehicles are so popular that its parent company's CEO is now concerned the carmaker may get too big for its own good.
In the current fiscal year, sales of Subaru, which is part of Fuji Heavy Industries, skyrocketed by 13% to 724,000 and may hit 752,000 by next March and 1 million by the end of the decade, according to Bloomberg News. Earlier this year, Subaru denied a Wall Street Journal story that it was concerned about shortages.
One reason for Subaru's success is the quality of its cars. The U.S. Insurance Institute for Highway Safety has given the new Forrester SUV (pictured) its highest safety award, making Subaru the only automaker to receive the accolade for four straight years, according to Bloomberg News.
Sales of Subaru's Impreza sedans more than doubled in 2012, and the new BRZ sports car was so popular that at one point consumers had to wait eight months to buy one.
"We're standing at a major turning point for Subaru," Fuji Heavy Industries president Yasuyuki Yoshinaga told Bloomberg News. "Some people in the company may want to make mass-market products or cheaper cars, but is this really the right direction for Subaru? We're not a carmaker that can grow as big as Toyota. And even if we could, reaching that sort of scale would mean we'd stop being Subaru."
During the past quarter, Fuji Heavy Industries' profit almost tripled to a record 48.5 billion yen (about $500 million). Analysts estimate the company will finish the fiscal year in March earning more than Suzuki, which makes twice as many vehicles as Fuji Heavy Industries, Bloomberg said.
Still, Subaru shows no signs of slowing. It plans to invest $400 million to boost output as demand for its vehicles continues to rise. CEO Yoshinaga will likely be looking over his shoulder, though, for any problems that appear because of rising production.
Follow Jonathan Berr on Twitter @jdberr.
Nice to see a CEO and President thinking about the quality of the product over the profit to be made.
You never see Subaru having a sale or having to give incentives to get customers.
It is nice to see a company worried about what will happen to them if they expand too much or too quickly. Something the small company feel is much better than a large company. They need to stay in touch with who is purchasing their cars and why they are buying these cars.
US car makers still have a ways to go. Japan has forced them to get better or they would still be making total junk.
Subaru stood behind any and all issues I had with this car.
Timing belt broke @ 60k miles, Cost me the tow to get it to the dealer.
and I had it back that DAY!
This was a great car that stood up to all the hype it didn't get at that time
This car was totaled in a head-on that left my wife with some moderate bruises
Posted speed limit for that street is 50mph.
They made damn good cars then and under their current leadership that looks to continue.
My Subie is a 1998 with 235,000 miles on it and counting. Just used it for a beach vacation driving 9 hours each way. These cars don't get enough credit for their quality. I've had BMW, Jaguar, Volvo, Honda(Acura), Mitsubishi, Chevy, Ford (probably forgetting something) and the Subie has been the most reliable by far. Not even close.
Every once in a while I'll catch myself thinking that maybe next time I'll get something else, and then I realize that it would be stupid to buy anything other than a Subaru for my climate and my needs.
My parents had a Loyal wagon and even with being lazy about the upkeep; that car lasted 10 winters for them, two years with me, and five years with my step sons before someone broad sided them with a full size car totaling our beloved car, but with no injuries to the boys.
I bought a well used GL 10 Turbo and drove the wheels off of it, endured three accidents and put it back on the road every time. These cars are built like a tank and just keep going and going even with out regular proper maintenance. If Subaru wants to ramp up production they should come to Arizona's job starved area to build their next factory. If these cars can survive AZ's tortuous climate they can hold up under any condition.
Build as many as you can while keeping the quality at 100 percent. If you run out, oh well, we can wait.
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The company has made at least 4 acquisitions in the space, and few people have paid any attention.
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