Subaru Will Spend $1 Billion To Improve Quality After Black-Eye From Recalls And Lawsuits | Torque News
Subaru is serious about improving quality in the new Outback, Forester, Crosstrek, and Ascent models. See why the automaker is spending $1 billion to do it.
Reported from Autonews (subscription required to read entire article)
Seemingly unstoppable Subaru intends to open the taps on tight supply in hopes of driving U.S. sales to a record high for a 12th straight year in 2020.
Quality issues have dogged Subaru since late 2017.
The problems emerged when the company disclosed that uncertified workers had for decades carried out tests of new cars for the domestic market.
The scandal deepened when Subaru also admitted that its final inspectors had faked fuel-economy and emissions data in some cases. Recalls to address cheating on the final inspections, combined with a spate of callbacks for various other glitches, spiraled into the hundreds of thousands of vehicles.
Nakamura returned to Japan to take over as president of the parent company in 2018 after being CEO of Subaru of America, and he immediately began tackling the problems.
"I was beginning to worry about the issue of quality shortly before I moved back to Japan. We were having more recalls," he said during a media roundtable in December. "I laid out quality improvement in the STEP midterm plan not because of the final-inspection issue, but because I had already been concerned about that, even when I was in the U.S.," he said.
"I thought this would be the biggest hindrance to our U.S. sales growth."
The company said it would spend more than $1 billion over five years to improve quality. The fix partly called for slowing production and implementing new quality measures and training procedures. Subaru also will set up a so-called "quality assurance laboratory" in Japan to redouble its efforts on matters such as testing, diagnostics and troubleshooting.
Last month, Subaru issued ¥40 billion ($365.2 million) in corporate bonds to help ease pressure on its cash reserves as it steps up outlays for quality expenses.
"We made quality reform our most important activity," Nakamura said. "All that contributes to improving the quality of the vehicles we are developing right now."