Subaru to increase capacity at Indiana site by 30% by 2016

Article by Anita Panait, on May 9, 2013

Subaru is planning to increase the output capacity at its Lafayette site in Indiana by around 30 percent and to include the production of the Impreza compact car by 2016, a person privy to the matter told Automotive News. The source said that the plant would build four- and five-door variants of the Impreza for North America.

The carmaker is expected to announce the plans on May 8, 2013. The plan will increase the plant’s production capacity by at least 100,000 units by 2016. Subaru is currently producing the Impreza only in Gunma, Japan.

An earlier report by Japanese business daily Nikkei said that Subaru is planning to invest $230 million to increase the plant's output. Fuji Heavy Industries Ltd., Subaru's parent company, has remarked that the extra capacity is needed to resolve a shortage of vehicles at dealerships in the United States, which is the carmaker’s largest market and accounts for 50 percent of the brand's global sales.

Subaru has been implementing a redesign of its lineup to better suit American tastes by increasing interior space and adding high technology features. According to the source, Subaru will likely build the Impreza on a second assembly line.

Subaru’s Indiana plant currently builds the Legacy sedan, and Outback and Tribeca crossovers on one line. It built 184,783 Subarus in 2012, up from 161,716 in 2011.

Subaru, however, has yet to decide whether to end production of the poorly selling Tribeca. The plant also builds Camry sedans on a separate line for Toyota, which holds a 16.5-percent stake in Fuji. In 2012, the Indiana plant built 93,126 Camrys.

According to Toyota spokesman Mike Goss, there will be "no changes" to the carmaker’s production at the plant. On May 1, 2013, Subaru's dealers in the US had an average of 39 days of supply -- an increase of three days from April 1, according to the Automotive News Data Center.

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