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Subaru is not yet prepared to manufacture electric vehicles independently. This cautious approach is understandable given the unpredictable nature of the EV market. Consequently, Subaru is reuniting with Toyota to work on three new electric crossovers, in addition to the existing Solterra, which shares its platform with Toyota’s bZ4X.
“It is currently quite challenging to predict the direction of the EV market,” stated Subaru CEO Atsushi Osaki, as reported by Automotive News. “There is a significant risk for us to navigate this sector alone. We have discussed this with Toyota and concluded that collaborative development is the safer path.”
This collaboration is not new, as Subaru and Toyota have a history of partnership on various projects. Their best-known joint venture is the Subaru BRZ and Toyota GR86, which are essentially identical vehicles. More pertinent to the current discussion is their joint production of the all-electric Subaru Solterra and Toyota bZ4X, which are manufactured by Toyota at its Motomachi plant in Japan. The upcoming three electric models, termed “Toyobarus,” are expected to be produced in the United States, allowing both brands to qualify for federal tax credits under the Inflation Reduction Act.
However, there will not be Subaru-built electric vehicles in the U.S. at this stage. “I have not indicated that we would engage in BEV production at our own facility in the U.S.,” said Osaki. “As the market evolves significantly, we will carefully monitor the situation as we move forward.”
On the other hand, Subaru will be producing hybrids in the United States. Both the Crosstrek and Forester will feature new hybrid powertrains and will be manufactured at Subaru’s Indiana facility. This represents a shift for the Forester, which has typically been assembled in Japan.
The collaboration with Toyota is expected to lower research and development expenses, allowing Subaru to retain a larger share of its recent profits. Over the past year, Subaru’s operating profits reached $3.06 billion, with net income climbing to $2.55 billion, marking its largest increase since 2016. With steady sales and rising earnings, Osaki aims to maintain stability, particularly in the EV sector. “While we are moving toward EVs, we believe it’s equally important to continue selling internal combustion engine vehicles. Thus, we already have plans to broaden our hybrid product offerings,” he concluded.
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