Subaru plans to reduce its short-term investment in electric vehicles and allocate more funding toward hybrid models as part of a revised ¥1.5 trillion electrification strategy. While the overall spending will remain the same, the company will reclassify it as ‘growth investment,’ adjusting the timeline and distribution of funds in response to shifting consumer preferences and incentive programs.
The Japanese automaker had initially allocated ¥1.5 trillion for its powertrain transition through 2030. According to Nikkei Asia, the plan has been updated to channel a greater portion of the funds toward hybrid vehicles, with a smaller share going to battery-electric models.
“Given the increasing demand for hybrids and the reappraisal of internal combustion engines, it is appropriate to delay the timing of full-scale EV mass production investment,” said President Atsushi Osaki, according to Nikkei Asia, during an earnings briefing.
Subaru declared the ¥1.5 trillion electrification budget in 2023. Of that total, approximately ¥300 billion has already been spent, while the remaining ¥1.2 trillion is now under review. The company is now placing greater emphasis on hybrid and gasoline models rather than fully electric vehicles, though it doesn’t reveal how the remaining funds will be distributed.
Meanwhile, Subaru is moving forward with its plan to release four electric SUVs in partnership with Toyota by the end of 2026. However, it is now evaluating a delay in launching four more electric models that were originally slated for in-house development by 2028.
Subaru’s approach to electrification has been affected by shifting market dynamics in the United States, one of its major sales regions.
In 2023, the company set a target of selling 400,000 battery-electric vehicles annually in the U.S. by 2028, with a global goal of 600,000 units by 2030. The same year, Subaru also declared plans to begin producing electric vehicles in the U.S. from 2027, though it has not yet confirmed whether that timeline remains unchanged.
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