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Subaru maker Fuji Heavy mulls new SUV for U.S. market
May 1, 2014 / 5:31 AM / 3 years ago

Subaru maker Fuji Heavy mulls new SUV for U.S. market

TOKYO, May 1 (Reuters) - Strong demand from U.S. dealers has prompted Subaru carmaker Fuji Heavy Industries Ltd to consider developing a new large SUV that would be made and sold in its biggest market, a spokesman said on Thursday.

Fuji Heavy is considering making a successor to the Tribeca SUV, which can seat up to seven people, spokesman Fusao Watanabe said. The company ended manufacturing the Tribeca in January at its sole U.S. plant in Indiana, which also assembles the Camry sedan for Toyota Motor Corp. Toyota owns 16.5 percent of Fuji Heavy.

Details on the new vehicle have yet to be decided, Watanabe said, adding that it would make sense for the company to locally manufacture a vehicle it intends to sell only in the United States.

Fuji Heavy, which in 2013 saw U.S. sales rise 26 percent to a record 424,683 vehicles, is in the process of expanding production capacity at the Indiana plant.

Fuji Heavy said in May 2013 that it plans to invest $400 million to boost the Indiana plant’s annual capacity by around 100,000 vehicles by end-2016.

The plant currently has an annual capacity of 270,000 vehicles, of which 100,000 is devoted to Toyota’s Camry. Subaru plans to expand that to 300,000 vehicles by around mid-2013.

Meanwhile, in late 2013, Fuji Heavy said it received notice from Toyota that the world’s biggest carmaker may cease production of the Camry at the Indiana plant in 2017.

Details of production plans for the Indiana plant are expected to be announced on May 9 when Fuji Heavy releases its mid-term plan as well as its full-year earnings results.

The Nikkei business daily reported earlier on Thursday that Toyota and Fuji Heavy will agree as early as this month to terminate Camry production at the Indiana plant and that Toyota could shift that Camry assembly to other factories, including its own Kentucky plant where it already makes the Camry.

It also reported that Fuji Heavy will develop a new SUV for the U.S. market, which it will manufacture at the Indiana plant, utilising the capacity that is currently devoted for the Camry.

“Toyota is in talks with Fuji Heavy over the setup of the Camry production at SIA (Subaru of Indiana Automotive), but nothing has been decided,” Toyota spokesman Naoki Sumino said.

Reporting by Yoko Kubota; Editing by Matt Driskill

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