Trump Tariff Tax Affects Subaru Outback Production

Thanks to a myriad of tariff taxes hanging over America these days, Subaru has elected to shift some of its production in order to insulate itself from the onerous fees.

According to a report from  Automotive News, the Subaru crew is choosing to provide Canadian customers with some models assembled in Japan instead of ones popping out of the brand’s Lafayette facility. That could apparently account for over 17,000 cars, with AN suggesting just greater than one-quarter of the 68,043 Subaru models sold in Canada last year were imported from the Indiana plant.

Does this mean a loss of production and cutting of shifts at Lafayette? Doesn’t seem like it. Subaru indicates it will backfill the newfound production space with the Forester later this year, a plan which seems to have been in the works prior to the word ‘tariff’ being one of the most searched terms in North America.

Canada’s free-trade deal with Japan (and other countries) will permit the entry of Outback wagons from Asia without penalty, giving Subaru the ability to continue selling the things at a relatively sane sticker price instead of having to slap a 25 percent tax on the Monroney. Subaru is said to have a target of just 10 percent for American imports into Canada. This suggests a goodly number of Forester crossovers will come to Canada from Japan in the future, as well.

Still, no one expects to get off scot-free. Tomohiro Kubota, who holds the CEO role at Subaru, told AN that pricing changes are still likely, underscoring the complexity of modern automobile assembly. Amid an ever-changing narrative and whiplash inducing decision making in Washington, tariff taxes of 25 percent are presently applied to global vehicle imports entering the States; Canada responded with their own 25 percent missive on cars imported from America (unless the brand has a presence in Canada) a couple of days later.

[Images: Subaru]

Become a TTAC insider. Get the latest news, features, TTAC takes, and everything else that gets to the truth about cars first by    subscribing to our newsletter.