Is Subaru In Trouble? Sales Fall After 33 Months Of Sales Growth

Subaru of America received a wake-up call in May. 

What happened to Subaru's sales? The Camden, N.J. automaker was flying along at a high altitude with 33 consecutive months of sales growth, and then, all of a sudden, the plane fell out of the sky. What happened to Subaru?

Was it the tariffs, the recent price increases, or the lack of inventory?

Subaru of America President and Chief Operating Officer Jeff Walters didn't say anything about the drop from the sky in the May sales announcement. He was silent. Maybe he was in shock?

Troy Poston, Senior Vice President of Sales at Subaru of America, said, "Our hardworking retailer network remains essential to our brand's success, especially as we work to address current low inventory on popular models like Forester."

The sudden and unexpected drop in Subaru's sales has left many in the industry surprised.

Subaru of America reported 52,292 vehicle sales for May 2025, representing a 10.4% decrease from the same month in 2024. If it weren't for Subaru's hot Crosstrek and Forester, it could have been much worse.

The 2025 Subaru Crosstrek was the top seller, achieving its best May ever with 15,793 vehicles sold, a 14.1 percent increase over the same month in 2024. The Forester compact SUV was close behind, with 15,434 small SUVs sold, a slight increase of 0.6 percent. After the top two sellers, it was not close. The Outback had a sales decrease of 32.1 percent.

So, What Happened To Subaru?

Subaru's May sales declined due to a combination of factors, including inventory constraints, higher interest rates, and the implementation of tariffs on imported cars. 

The low inventory, especially for popular models like the Forester, affected sales, while higher interest rates and elevated borrowing costs made financing more expensive for Subaru's customers. 

The 25% tariffs on imported cars, although not affecting all Subaru models, have created significant uncertainty and potentially discouraged some purchases, a concerning trend for Subaru and other automakers. 

Forester's inventory is low.

I spoke with my friend Jose yesterday, who was looking to buy a 2025 Subaru Crosstrek but decided on the 2025 Forester because it had "more space, and it's easier to get in and out, and it has the same mechanics," he told me. He wanted a Forester Premium trim level, with the Auto-Dimming Mirror with Compass and HomeLink package. 

It's a popular feature that includes an auto-dimming rearview mirror, an 8-point digital compass, and HomeLink with three programmable buttons for garage doors, security gates, and other compatible devices. 

Jose could not find any Subaru Forester Premium trim levels with the desired features and color. The Subaru dealer only had one Subaru Forester available, a more expensive Forester Limited trim level, which they tried to sell him. 

The scarcity of the Forester Premium trim level is a pressing issue for both Subaru and its customers.

The Subaru dealer informed Jose that the Forester Limited was all they had, and the new Forester models, including the Premium trim he wanted, were being shipped to the dealer. However, they would have a price increase. Keep in mind that this is a Subaru dealer near Denver, Colorado —the Subaru capital of the world. 

Subaru dealers do not have inventory to sell to their customers who are ready to buy. 

Why did Subaru run out of Foresters to sell? 

Subaru's savvy shoppers read about the impending tariffs, which would lead to price increases, and bought the compact SUV before prices rose. Subaru dealers were eager to see as many cars as possible. 

In April, Subaru of America sold nearly 20,000 Forester models to customers, making the small SUV the top seller for four consecutive months. So, now, the inventory of most Forester trim levels is low. 

Subaru's Response Is To Raise Prices

According to a report from Automotive News, executives stated that tariffs could cost Subaru Corporation approximately $2.5 billion in the current fiscal year if the company doesn't take any actions to mitigate the impact.

Subaru stated in a press release that the increases were made in response to "current market conditions" without citing tariffs or specific price actions.

"The changes were made to offset increased costs while maintaining a solid value proposition for the customer. Subaru pricing is not based on the country of origin of its products," the Japanese automaker said in a statement.

Subaru of America raises prices.

Subaru of America has hiked prices on several models and will pass the increases along to customers with new models arriving at dealer showrooms in June. The Subaru price increases will add between $750 and $2,055 to vehicles depending on the model and trim, according to a notice posted on a dealer website.

The Subaru Forester model is one of a handful of lower-cost vehicles set to be most affected by tariffs, according to Cox Automotive executive analyst Erin Keating. The compact SUV is getting a price hike of between $1,075 and $1,600, depending on the trim, according to the dealer notice.

Subaru Shakes Up Its Leadership

In April, Subaru of America, based in Camden, N.J., announced a pair of key executive changes in North America, its largest and most important market. The Japanese automaker will now lean on a company veteran with significant U.S. experience to lead Subaru of America. This change in leadership could signal a new direction for the company in response to the latest sales climate.

Yoichi Hori replaces Tadashi Yoshida as CEO of Subaru of America. Yoshida was promoted to Managing Executive Officer at Subaru Corp. in Japan, where he leads the Global Sales and Marketing Strategy Office. Yoshida took over for longtime Subaru executive Tom Doll in April 2023.

Conclusion

Subaru of America is not in trouble yet, but the Camden, N.J.-based automaker is experiencing a sales downturn for several reasons. It's due to the tariffs, the recent price increases, and now the lack of inventory. They could be in for a bumpy ride. 

Did Jose Buy the More Expensive Forester Limited?

I talked with my friend Jose, and he said he and his wife did not purchase the Forester Limited. He was ready to pull the trigger on the Forester Premium if the dealer had one to sell him. Now, he may consider purchasing a car or SUV from another brand altogether. Subaru will likely lose more customers like Jose. 

It's Your Turn

Have you been shopping for a Subaru Forester or another model? If so, we'd love to hear about your experience. Click the red Add New Comment link below and share your thoughts on Subaru's sales decline and the factors contributing to it.

Check out my Subaru Forester story: Torque News Editor-in-Chief Says “Subaru’s Future Is Not EVs, It’s a Mysterious 194 HP Surprise, It’s the 2025 Forester Hybrid”

I am Denis Flierl, a Senior Torque News Reporter since 2012. My 30+ year tenure in the automotive industry, initially in a consulting role with every major car brand and later as a freelance journalist test-driving new vehicles, has equipped me with a wealth of knowledge. I specialize in reporting the latest automotive news and providing expert analysis on Subaru, which you'll find here, ensuring that you, as a reader, are always well-informed and up-to-date. Follow me on my X SubaruReport, All Subaru, WRXSTI, @DenisFlierl, Facebook, and Instagram.

Photo credit: Denis Flierl via Subaru dealer