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Subaru’s Success In America Is Coming At A Cost

Industry News / Comments

Japanese carmaker struggling to cope with increased demand.

Subaru has been enjoying monumental success in the US. Last year was a landmark sales year for the automaker in America, and this success is expected to keep growing. However, according to Automotive News, this success is coming at a cost and putting Subaru's production facilities under serious strain. As a result, quality control is being overlooked and leading to recalls, production has ground to a halt, and workers are either quitting or being forced to work crazy hours to meet the increased demand.

In response to accusations about poor working conditions, the automaker acknowledged that some facilities in Japan compelled thousands of workers to forgo millions of dollars in unpaid wages by working overtime off the clock. Subaru's struggles culminated last month when production at the automaker's sole Japanese plant shut down for almost two weeks after the company discovered a defect in an electric power steering unit.

Problems are now creeping into the US in the form of recalls and lost shipments. "We continue to be concerned that [Subaru] is not making the necessary investments and changes fast enough to ensure that vehicles are being produced with the quality the brand and its customers deserve," the marque's US National Retail Advisory Board wrote in a September 18 resolution to top Subaru management in the US and Japan after the Ascent crossover was recalled last year.

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Ultimately, the huge demand for Subarus is outstripping the supply – and the situation could get worse with the next-generation Outback about to enter production, which is an important model for the brand. Subaru CFO Toshiaki Okada admitted the company should have "increased our capacity accordingly in terms of management and facilities" to meet the increasing demand.

Now, Subaru is trying to "carefully" make up for January's lost production. "Our top premise is that we will manufacture cars by ensuring quality," Okada said. "We won't seek to ramp up production hastily. We think it is very important to fix that, and we must ensure quality, compliance and safety. That is our company's mission."