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Fuji Heavy Industries’ flat engine FR cars. Can they answer worldwide expectations?

5, 02. 2008

   Fuji Heavy Industries Ltd. decided to stop developing and producing mini cars this year that marks the 50th anniversary of the sale of "Subaru 360" cars. As a reason for the decision, Kunio Mori, president of the company, told reporters that the company was determined to concentrate all its resources on its core business. What he meant by the core business was the horizontally opposed engines (flat engines) and cars by powered by them. To protect such models of cars as the "Legacy" and "Impressa" that would lose the characteristics as the company's cars unless they are powered by the flat engines, the company seems to have had no choice but give up mini cars.

Rumor has it that "Development of next-phase cars to follow mini cars has come to a halt."

“R2” struggling for stronger appeal with design
“R2” struggling for stronger appeal with design

   The Subaru mini cars are expected to be shifted gradually to OEM (original equipment manufacturer) cars from Daihatsu Motor Co. over three years from 2009. In the meantime, Fuji will develop a small FR sports car powered by a flat engine jointly with Toyota Motor Corp. The two companies will begin selling the new model of cars in late 2011. Has Fuji found way to survive by this latest tie-up?

   Through the latest tie-up strengthening, Toyota has expanded its investment in Fuji to 16.5%. The 31.2 billion yen to be obtained from the investment increase will be spend as part of the expenses for the construction of a plant for manufacturing small FR sports cars.

   The halt of mini car production by Fuji has been rumored since October 2005, when Toyota replaced GM as the biggest shareholder of Fuji. The rumor started as the Toyota group included Daihatsu, which replaced Suzuki Motor Co. as the top mini car producer in fiscal 2006, and the business activities of Fuji and Suzuki overlapped with each other.

   If Fuji was conducting its mini car business smoothly, there was no problem. In reality, however, Fuji's mini car business was not without difficulty. The "R2" and "R1," which Fuji made the last-resort effort to appeal to the market by emphasizing their designed and performance, did not sell well. The Subaru's market share dwindled as Suzuki and Daihatsu competed for the top place, while Nissan Motor Co. entered the mini car market with the OEM cars from Suzuki and Mitsubishi Motors Corp. Rumors spread among dealers that the developing of the next generation cars has come to a halt.

Full model change of Legacy in 2009 is a hurdle

   The research and development works of carmakers are expanding against the background of the business globalization and the advance of the environment and safety technologies. Fuji put on the U.S. market the crossover "Tribeca" cars, and the company will introduce new cars powered by horizontally opposed engines to the domestic mini-van market which the company has hitherto neglected. Moreover, the company is planning to complete the cars powered by flat diesel engines which are absolutely necessary for expanding sales on the European market, while it is also trying to develop the next-generation flat engines and CVT (continuously variable transmission) and auto bodies to suit such engines. There is no guarantee that the company can successfully achieve all of these.

   It is understandable now that it was imperative to do some shake off and concentration for the survival of the Subaru cars. It is meaningless to wish that the "R2" and "R1" had been successful hits.

   The minimum requirement for the company to secure a position in the car industry is that it will be successful with the Subaru cars powered by flat engines starting with the "Legacy" that is due to go through a full model change in 2009 and the small FR sports car to be developed jointly with Toyota. The FR car powered by a flat engine is a unique idea. It might provide a chance to open a new world for small sports cars. It is hoped that the company will live up to the expectation of not only the Subaru fans but car lovers of the world.

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