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Subaru profit climbs 48% on strong crossover sales in first quarter

TOKYO — Subaru reported a 48% increase in first-quarter operating profit on Monday as global sales grew, led by demand for the Ascent and Forester SUVs in the United States. The smallest of Japan's major automakers posted an operating income of 92.2 billion yen ($870 million) for April-June, versus 62.1 billion yen a year earlier and an average estimate of 65.6 billion yen from eight analysts polled by Refinitiv. Sales in the United States, by far Subaru's biggest market, rose 20%. It accounts for about 60% of Subaru's overall sales. The maker of Legacy sedans and Forester SUV crossovers maintained its forecast for operating income at 260 billion yen for the year to March 2020, up 45% from a year earlier. The previous fiscal year was marred by a string of recalls, production stoppages and inspection improprieties that cut the automaker's earnings in half. Subaru reiterated its annual forecast for global sales of 1.06 million vehicles. It also left unchanged its assumption that the yen will average 110 against the dollar over the course of the fiscal year, versus 111 last year. A stronger currency eats into profits because cars exported from Japan become more expensive and the value of earnings made overseas decreases.

Should Subaru stay niche or go mainstream? [w/poll]

Out of all the automakers doing business in the US, Subaru is the one that has carved out the most interesting niche for itself in the minds and lifestyles of buyers. Outdoorsy types, dog lovers and active families alike flock to Subaru's rugged nature and all-wheel-drive utility - and they're fiercely loyal, which is probably why Subaru has become a success story.
But Subaru is still a relatively small player in the US market, and with recent profits surging, parent company Fuji Heavy Industries is facing a dilemma: continue on with the successful niche market Subaru has carved out for itself, or attempt to go mainstream and give big players like Nissan and Toyota a run for their money. According to Carscoop, Japan Times and Bloomberg News are reporting that Fuji Heavy is beginning discussions this month to determine which direction Subaru will take.

Subaru recalls new Forester over pedal entrapment fears

Pedal entrapment and unintended acceleration are hot-button topics these days, so automakers are always staying alert for potential problems. For Subaru and its newly introduced 2014 Forester, the National Highway Traffic Safety Administration has issued a recall due to improperly manufactured floor mats that could become an obstruction for the gas, brake or clutch pedals. The good news, of course, is that even if drivers experience this problem, the 2014 Forester comes standard with brake override.
At issue with the floor mats on 10,137 Forester models built between January and March of this year is that the resin material used on the underside of the mats can curl when exposed to heat. If the leading edge of the driver's mat curls enough, it can come in contact with the pedals making acceleration, braking and shifting more difficult - possibly resulting in a crash. To fix the problem, Subaru is replacing the entire set of floor mats in all of the affected units. The official NHTSA recall notice is posted below.