Although China is Subaru’s fifth largest market after the U.S, Japan, Canada, and Australia, it’s the only Japanese manufacturer without a production facility in that enormous market. Auto manufacturing is strictly regulated in China, and international companies are prohibited from operating alone in the Chinese economy, and must form joint ventures with local companies. Furthermore, while Chinese companies can create as many alliances as they want, foreign companies are restricted to only two. Subaru’s previous attempts to form a partnership with Chery were quashed by the Chinese government since their parent company, Fuji Heavy Industries (now called SBR), already has two ventures in China with Toyota, their largest shareholder. It’s nearly impossible to compete in the Chinese market without domestic manufacturing thanks to its 25 percent import tax—so it’s safe to assume that Subaru hasn’t quite given up on those plans of expanding into China.
Here in Canada, Subaru has set six consecutive annual sales records. In 2017 the booming Canadian automotive market grew by 4.6 percent while Subaru achieved a sales increase of 8.7 percent and set a new all-time record of 54,570 vehicle sales. That’s a mainstream-size sales number for this somewhat niche automaker.