TOKYO -- Subaru is feeling the burn of its red-hot sales.
With the brand stung by a spate of U.S. recalls that undercut earnings this year and an embarrassing tumble in its cherished Consumer Reports reliability rating, its top global executive, Yasuyuki Yoshinaga, says he is stepping up safeguards as quality strains under explosive growth.
The first step began in April with the appointment of a new quality czar sent from Japan to directly manage the issue in the U.S., says Yoshinaga, CEO of Fuji Heavy Industries, the Japanese parent company of the popular all-wheel-drive specialist brand.
In a Nov. 7 interview with Automotive News, Yoshinaga said quality is Subaru's top priority and that it is taking pre-emptive actions to stave off problems as Subaru and its suppliers find their feet amid rampant sales and production expansion.
"We've always been focusing on quality, but we did have an increase in recalls," Yoshinaga said at the company's global headquarters here. "We've assigned a former FHI officer who was in charge of global quality assurance to oversee and enhance Subaru's quality in the U.S. market."
The heightened vigilance is a rare move for a company that could do no wrong in recent years. It also underscores a threat that has tripped up much bigger and richer companies, including Toyota Motor Corp., which blamed unrestrained growth for its infamous 2010 recall crisis.
Subaru has been unstoppable.
The brand is poised for an eighth-straight year of record U.S. sales, with a forecast to climb 5.5 percent to 615,000 vehicles this year. The company hasn't had a monthly sales decline since November 2011. And, Yoshinaga says, it will see a ninth-straight year of record sales.
U.S. sales should jump again in 2017, this time 8.9 percent to 670,000 vehicles, Yoshinaga told Automotive News, even as he conceded that overall U.S. market demand "has already peaked out."
By the fiscal year ending March 31, 2021, Subaru's U.S. sales will top 750,000, he predicts.
That unrelenting surge is driving a ramp-up in production for Subaru, one of Japan's smallest automakers. It plans to expand global production capacity by a full third to 1.1 million vehicles in the fiscal year ending March 31, 2019, from just 854,000 last spring.
In the U.S. alone, where Subaru has its only assembly plant outside Japan, the company plans to increase annual capacity at the Lafayette, Ind., factory to 436,000 units by 2019. It produced 308,647 vehicles last year, including assembly of the Toyota Camry.
Growing pains were the inevitable result of the sales boom, Yoshinaga said.
"The background of our current situation is Subaru's rapid sales growth that has caused strain to our U.S. production and to our suppliers," he said. "Having recalls like we've had this year, we realize the strong need to strengthen our effort to ensure high quality."