Subaru has announced plans for a lineup expansion with three new fully electric SUVs developed in collaboration with Toyota, aiming for a 50 percent EV sales mix in the long term. The move comes as the company seeks to navigate the uncertainties of the EV market. The Japanese automaker’s yearly financial results reflect a robust performance, with a 75 percent increase in operating profit and a 15 percent rise in global sales.
Despite the positive financial results, the current Solterra, Subaru’s sole EV offering, accounted for just 0.02 percent of its global sales in 2023. To bolster its EV presence, Subaru plans to introduce three new electric SUVs by the end of 2026, with an additional four by the end of 2028. The initial trio will be developed by Toyota to minimize R&D costs, similar to the collaborative effort behind the Subaru Solterra and Toyota bZ4x.
Subaru CEO Atsushi Osaki emphasized the strategic importance of the partnership with Toyota, stating, “Through this approach of joint development, joint production and joint supply, we will ensure flexibility in the areas of development and production while mitigating risks with Toyota Motor Corp. at a time when it is difficult to clearly predict future trends.”
One of the upcoming electric SUVs will be produced at Subaru’s Yajima plant in Japan, while another will be manufactured in the United States by Toyota to qualify for federal EV tax credits. The US-built model could potentially be a three-row electric crossover, speculated to enter production in Kentucky in 2025 under both the Toyota and Subaru badges.
In addition to its EV plans, Subaru announced that the next generation e-Boxer hybrid powertrain will commence production in Japan in the fall of 2024, followed by the US in 2026. Osaki affirmed the company’s commitment to selling internal combustion products alongside EVs, with plans to expand their hybrid product lineup.
The Subaru Forester’s strong performance in the US, with a 60 percent sales increase in the first quarter of 2024, led the company to increase production capacity for the SUV at its Indiana plant. This decision followed the discontinuation of the Legacy sedan.
Subaru’s financial results for the fiscal year ending in March 2024 were positive, with operating profit increasing by 75 percent to 468.2 billion yen ($3.09 billion), the highest since 2016. Net income nearly doubled to 385.1 billion yen ($2.55 billion), while revenue rose by 25 percent to 4.70 trillion yen ($31.06 billion). The company delivered 976,000 vehicles globally in the past 12 months, a 15 percent increase compared to the previous year, driven by strong sales in the US and Europe.
Looking ahead, Subaru forecasts global sales of 980,000 units for the next fiscal year, a 1 percent increase, with 700,000 units expected to be sold in the US and 15,000 units in Europe. However, the company anticipates a 15 percent decline in operating profit and a 22 percent drop in net income due to the expected recovery of the Japanese yen and increased investment in R&D.
