Facing a year of complicated trade negotiations while factories in Japan prioritize quality over output, Subaru expects its slowest growth rate in years, even though dealers can barely keep new models in stock.
With the company's factories addressing an array of quality problems, the brand's U.S. dealers finished last year with just a 26-day supply of vehicles, by far the lowest in the market.
"If we could get more, we could sell more," Tom Doll, CEO of Subaru of America, said after the brand's make meeting at the NADA Show. "Our initial sales target was much higher than where we ended up, at 700,000."
That goal would amount to only about a 3 percent increase after a decade or so of 14 percent annualized growth, Doll said. "We want to make sure that we address those quality issues so that once we get into the next round of growth that's coming, we can adequately handle it and make sure the vehicles are of the highest quality possible."
Despite the short supply, dealers are pretty happy, said Wally Sommer, chairman of the Subaru National Retailer Advisory Board. Last year 266 of them sold more than 1,000 Subarus, up from six who sold more than 1,000 in 2008.
"Our limitation is really our product availability," said the president of Sommer's Subaru in Mequon, Wis., near Milwaukee. "I'm sure that we're losing business in the Ascent."
Supplies are also very tight on the Crosstrek and Forester.
"We don't have enough cars," he said.
Doll gets it. With a twist on the adage about the benefits of undersupply, he said: "It's always best to have one less than one more — but sometimes, you'd like to have a few more."
Supply could also be constrained by tariffs or negotiated limits on vehicle imports. The Trump administration is weighing whether to declare imported autos — like imported steel and aluminum — a national security threat, leading to possible tariffs. Also this year, the U.S. and Japan are poised to begin bilateral trade talks.
But Doll said there is little he can do to prepare for the possible outcomes.
"It's out of our control," he said. "Once we know about it, then we can start planning for it."
While admitting he may be unusually optimistic, Doll said he's hopeful the relationships between the two countries and their leaders are strong enough that "cooler heads will prevail, and we'll be OK. I hope, anyway."
