Subaru of Indiana is investing in $158 million in of its Indiana plants, creating 350 new jobs in the process.
The investment is being used to add a new service parts facility and transmission assembly shop at its Lafayette, Indiana plant. The new facilities will be located on Subaru of Indiana Automotive’s 820-acre campus, the company revealed.
Plans call for the service parts facility to be a standalone plant while the transmission and assembly shop will be added to the Lafayette plant. Construction will begin in summer.
“Our production levels have tripled over the past 10 years,” said Scott Brand, senior vice president of administration and quality at Subaru of Indiana Automotive. “These new projects are exciting growth opportunities to help us meet increasing customer demand.”
Subaru of Indiana Automotive is the only manufacturing facility that Subaru has outside of Asia. The company employs more than 6,000 workers and began production for Subaru in 1989. Annual vehicle production at the plant is expected to reach 410,000 in 2020.
The plant has been steadily increase capacity in recent years as the popularity of Subaru’s small utility vehicles continues to grow. Each of the past several years, the company has set new annual sales records in the U.S. The plant’s expansion is important as 50% of the vehicles sold in the U.S. come from the Lafayette, Indiana plant.
Subaru Inc. CEO Tomomi Nakamura predicted late last year that 2020 will bring another benchmark-setting result in America. He said the popularity of is SUV and crossover models in the U.S. will push it to record sales this year, noting the demand in its top market, and the world’s second-largest market behind only China, for its Forester and Outback models should push sales up.
Nakamura predicted sales of the two utes will help overall Subaru sales to rise to as much as 730,000 units in the U.S., which would be more than a 4% increase over the expected 700,000 vehicles it will sell in the U.S. this year.
Nakamura also believes the company could grow its sport-utility share in the U.S. beyond the 7% it currently enjoys. “If competition in the U.S. SUV market continues, that segment will keep growing even as the overall market slows,” he said.
U.S. sales account for around 65% of Subaru’s total global sales of around 1 million units. By the end of November, sales of the Forester this year had climbed 6.4% from a year ago, while sales of the Outback, its best-selling model in the country, were up 0.9 percent.