Subaru Mulls Capacity Increase in N. America

Fuji Heavy Industries Ltd. is considering boosting its production capacity for Subaru vehicles in North America by mid-decade, The Nikkei reports.

President Yasuyuki Yoshinaga tells the Tokyo-based newspaper the company hopes to make a decision by year-end. He doesn't specify whether FHI is considering erecting a new factory or expanding its existing assembly plant in Lafayette, Ind.

That facility makes the Subaru Legacy midsize sedan, Outback wagon and Tribeca crossover vehicle and the Toyota Camry midsize sedan. The company began building the Camry for Toyota, which owns 16.5% of FHI, in 2007 at the then-underutilized Indiana plant.

Since Subaru's American sales began to soar in 2010, FHI has boosted the factory's annual capacity from 100,000 vehicles to 156,000. The company said it June it would spend $75 million over two years to hike capacity there to 180,000 units per year.

Booming sales are prompting FHI's thoughts of expansion. From April through September, U.S. demand for Subaru vehicles jumped 29% year over year to 164,900 units. Yoshinaga predicts that in the full fiscal year ending on March 31, the brand will sell a record 330,000 vehicles.

He also expects Subaru to achieve its U.S. annual sales goal of 350,000 units in the 12 months ending in March 2014 two years ahead of schedule. That volume would mark an 86% surge in volume over five years.