The Subaru Forester is the brand’s most popular vehicle in the Philippines as well as in the ASEAN region. Until now, Motor Image, the official distributor of Subaru in 10 markets across the Asia Pacific region, has been sourcing its vehicles from Japan or Malaysia. The Japanese plant, which produces vehicles for markets around the world, has been pressured to increase its output beyond what it is capable of producing in order to answer increased demand worldwide. The newly-opened Thailand plant, also known as Tan Chong Subaru Automotive (Thailand) Limited (TCSAT), is the brand’s fourth plant in the world. TCSAT’s opening will help alleviate pressure from its plants across the world.
Subaru’s growing sales success has also led to numerous challenges in its production system. These issues have led to numerous vehicle recalls over the past few months, ranging from valve springs, power steering, and data falsification, among others. Mr. Tomohiro Ishitobi, Senior General Manager for Sales and Marketing of Subaru Corporation, admits that its aging facilities, as well as continuous record-breaking sales, have put pressure on the brand, leading to shortcuts in its final vehicle inspection line, which led to the falsification of data in order to shorten inspection times. However, it must be noted that the falsification of data did not violate any government regulations in Japan, but it was a violation of its internal standards.
Since the string of recalls, Ishitobi-san says that since the incident, numerous improvements have been made in its Japanese plant as well as its management as it renews its focus on delivering quality vehicles. The opening of the Subaru plant in Thailand is meant to reduce the pressure in its current manufacturing and assembly plants across the world, especially at its Japanese plant.
In the Philippines, the all-new Subaru Forester has been a runaway hit for the brand. With an affordable price, as well as being packed with features which include the renowned Subaru EyeSight suite of active driver assist systems in most variants, the Subaru Forester has been well received by Filipino consumers. As a matter of fact, Motor Image Pilipinas Marketing Manager Uzzi Asuncion mentions that the initial batch of the Subaru Forester 2.0i-S EyeSight variant has been sold out. Since all our Subarus are coming from Japan, it will be months before the next allocation arrives.
With the opening of its Thailand factory, waiting times for the Subaru Forester in the ASEAN region will be significantly shortened as well as made more affordable. In markets like Vietnam, the Subaru Forester, which is shipped from Japan, costs about twice as much compared to the Honda CR-V, which is assembled in Thailand. Expectedly, the reduced suggested retail price of the Forester in Vietnam, as well as in Thailand, has led to record sales growth.
Mr. Glenn Tan, Deputy Chairman and Managing Director of TCIL, said, “This is truly a milestone for us, to be able to build Subaru cars ourselves in Thailand. From distribution, dealerships and aftersales, we are now also manufacturing Subaru cars. This strategic long- term move will allow us to better manage our supply chain, widen our product line up, localize better and be less dependent on supply from Japan. We will be better able to respond and meet consumer demand for Subaru vehicles in the region, and perhaps even beyond the region in the future.”
TCSAT will mainly produce right-hand drive Subaru Foresters, but it will take time before the Philippines sources its vehicles from TCSAT. This is because according to Mr. Tan, it is too risky to source all of the Philippine-market cars immediately, considering the Philippines is a left-hand drive country. As a matter of fact, the Philippines is Motor Image’s largest market, not counting Taiwan on which it is a 50-50 joint-venture with Subaru Corporation. For now, Vietnam is the only left-hand drive market that TCSAT serves. Once TCSAT becomes accustomed to producing both left-hand drive and right-hand drive cars in large quantities, he may consider the Philippines as a market that Thai plant will soon serve.
TCSAT employs a team of Japanese staff to ensure that production standards and processes meet the same stringent levels as in Japan. In addition, high-performance robotics are used at several stages of the assembly process to ensure superior quality and zero defects. At the painting line, the pre-treatment, electrical deposits, primer, and top coat are applied automatically. The key welding points of the car body and the sealer application for glass components are also automated to achieve total consistency. This is part of the technology and skills knowledge transfer which Subaru Corporation has committed to.
With the ASEAN region being a driver of growth for Subaru, the opening of TCSAT will further bolster its commitment for the ASEAN market, as well as being able to produce vehicles that are catered to satisfy consumer preferences and demand in the region.