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Subaru nixes plans for US-built XV Crosstrek

Subaru is on a sales tear, with numbers up 21 percent through the end of November compared to last year. It's been investing in its Indiana factory, and having ended its contract to build the Toyota Camry there, the 400,000-unit capacity was once seen as more than Subaru needs. At some point Subaru had plans to build the XV Crosstrek here in the US, but Reuters reports that the company has changed its mind and will build the little crossover Scooby in Japan, in the same Gunma Prefecture factory where the Impreza, BRZ and Levorg are built. The report cites "the relatively high sales price," the weakening yen versus the dollar and capacity constraints at the Indiana facility. For a planned production run of 65,000 Crosstrek units annually, the new math – especially the yen valuation, which has declined against the dollar to a rate not seen since 2007 – makes Japanese production a viable option. Subaru isn't the only manufacturer taking its toys back home, either: the Reuters report says Toyota is considering shifting some Camry production back to Nippon, while Nissan plans to do the same with the Rogue. Our guess is that if Subaru sales continue the trend they've been on for years, the assembly decision will give them more local flexibility here for addressing it. Featured Gallery 2014 Subaru XV Crosstrek Hybrid: First Drive View 53 Photos News Source: ReutersImage Credit: Copyright 2014 AOL Plants/Manufacturing Subaru Crossover subaru xv crosstrek

Subaru weighing Outback vs Forester approach for seven-seater

Subaru is gearing up for a return to the seven-seat crossover segment, and it's focusing the new model on the US market, but just which approach it will take has yet to be decided. One possibility, according to Automotive News, would be to position it as a larger counterpart to the Outback wagon, with rugged off-road styling. The other would be to sell it as a big brother to the Forester, with cleaner styling. One thing Subaru most definitely does not want to repeat is the Tribeca fiasco, so we wouldn't expect the new model to carry that same nameplate. Introduced in 2006, the Tribeca's divisive front-end styling kept it from being a serious player, and it underwent a facelift only two years later. It was withdrawn from the market altogether after 2014. The company had targeted moving 36,000 units of the Tribeca each year, but sold fewer than 2,800 in America in 2011, barely over 2,000 in 2012, less than 1,600 in 2013 and just a few hundred in 2014. The new seven-seat crossover will go after the likes of the Toyota Highlander, Nissan Pathfinder and new Honda Pilot among three-row Japanese crossovers. Like those rivals, it will be built in the US for the US market – namely at Subaru's assembly plant in Indiana, the same state where the Highlander is produced. The new crossover's arrival will, according to reports, mean that the Levorg wagon offered in Japan and Europe won't be offered Stateside. Related Video:

Will more efficient tech mean higher prices for Subaru?

If the latest ruling by the California Air Resources Board holds, then Subaru at least must build a plug-in hybrid in the coming years to comply with the Golden State's regulations. Fuel economy looks to improve across the board for the brand, though, thanks to $780 million going into the development of cleaner powertrains for this fiscal year alone. However, buyers might have to pay more for a Subie in the future after this boost in green spending. "Related costs are going up more than expected, bringing the profit margin downward," Fuji Heavy Industries President Yasuyuki Yoshinaga said to the Nihon Keizai newspaper in Japan, according to Automotive News. "We are a small company. We do not benefit as much from economy of scale as bigger companies, so we will have to make up for the increased costs by raising our brand value." At the moment, Subaru's electrified lineup in the US comprises just the XV Crosstrek Hybrid, but the company is reportedly planning to add more. Plus, Subie also wants to make its internal combustion engines more efficient. According to Automotive News, all of the brand's mills are getting direct injection by 2016, and cylinder deactivation and lean combustion cycles are on track for 2020. Earlier rumors also suggested that the automaker might bring the turbocharged four-cylinder boxer to more products, as well. While these more efficient models might cost more, Subaru must carefully maintain the balancing act of introducing the technology and keeping sales growing. As of May 2015, the brand had 42 straight months of year-over-year growth in the US and had record sales in the country last year. The company has already decided to significantly boost production capacity at its Indiana factory in hopes of keeping the good times rolling.