Subaru has an unexpected secret recipe for success in the US image

Yasuyuki Yoshinaga, the top ranking executive at manufacturer of Subaru vehicles, has many reasons to rejoice – even as dealers in the US might try to assault him to gain prominence when discussing upcoming supply patterns.

That’s because the Japanese automaker has only one problem – produce enough automobiles to meet the increase in demand seen in the United States, the second largest auto market in the world. Subaru’s US deliveries have almost doubled in the span of just four years – driving the demand has been the company’s Forester all wheel drive sport utility vehicle, which has reached almost a cult status among American drivers for performance, price and panache of social responsibility. Subaru’s key pledge of being an automaker with a conscience, through their “Love Promise,” has been making inroads towards delivering “a positive impact in the world,” striking the right cord with loyal motorists in states such as California, New York and Washington.

But the rising profits also paint a hidden picture. Subaru’s Japanese manufacturing hub in the Japanese town of Ota, two hours north of Tokyo is being filled with cheap foreign laborers from Asia and Africa. Using short-term contract workers, these yield around half the expense of their Japanese counterparts and even the carmaker’s suppliers often use them, offering jobs through brokers that can then snatch up to a third of their salaries. Often in very hard working conditions, cheap laborers from places such as Bangladesh, Nepal, Mali and China make up most of the Subaru cars components. These problems are also an extrapolation of Japan’s rather odd labor market, impacted by the nation’s shrinking population and tough immigration barriers.

Via Reuters