Subaru Will Spend $1 Billion To Improve Quality After Black-Eye From Recalls And Lawsuits
Subaru received a black eye this past year because of numerous recalls, scandals, and a multitude of class-action lawsuits. The U.S. is the brand’s largest global market and Subaru of America just finished its 12th consecutive year of record growth. But there have been growing pains with the Japanese automaker attracting a record number of customers each year.
If you are a regular reader of Torque News, we have covered these quality issues extensively. According to a recent report from Automotive News (subscription required) Subaru Corporation will spend more than $1 billion over five years to improve quality in their vehicles. “The fix partly called for slowing production and implementing new quality measures and training procedures,” the report said.
2020 Subaru Outback is the number one selling vehicle in the U.S.
Subaru has the lowest inventory of any automaker
With the quality issues plaguing the automaker, Subaru CEO Tomomi Nakamura is still under pressure to keep the momentum going and says they want to continue to grow and will need to boost production at its plant in Gunma, Japan, and its North American plant in Lafayette, Indiana. Subaru has the lowest supply of cars (24-day supply) on dealer lots of any automaker. The industry average is somewhere near 60, and sometimes even a 70 day supply.
Shoppers in December experienced a lack of inventory, especially Forester and Crosstrek (12-day supply) which are manufactured in Japan. Output in Indiana where the new 2020 Outback, Ascent, and Legacy are produced, is expected to rise by 30,000 vehicles this year, Nakamura said. The Outback is the brand’s number one selling vehicle in the lineup.
2020 Subaru Forester and Crosstrek were in low supply in December
Subaru walks a tightrope with quality on one side and increasing production and continued growth by producing more all-wheel-drive vehicles on the other. Subaru is trying to do both and knows quality needs to improve or they will lose customers.
On April 1, 2019, Subaru Corporation revised its Quality Policy. In order to restore faith in the company, the Japanese automaker announced the new "Quality Policy" in order to realize "quality reform" which was one of the themes of the medium-term management vision "STEP" announced in July 2018. You can read about the new policy here.
Subaru is working on a solution to the recent recalls and lawsuits and has committed $1 billion over five years to do it. This is what customers care about. Customers want a quality Outback, Forester, Crosstrek, and Ascent all-wheel-drive SUV from Subaru and couldn’t care less about the Camden, N.J. automaker hitting a 13th straight year of record growth.
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Denis Flierl has invested nearly 30 years in the automotive industry in a variety of roles. All of his reports are archived on our Subaru page. Follow Denis on Facebook, Twitter, Instagram, Subaru Report. Check back tomorrow for more Subaru news and updates!
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Photo credit: Subaru DR, Crosscreek Subaru