May 2004

Challenge to the FDR-1

Fuji Heavy Industries, Ltd. (FHI) is pursuing its new mid-term management plan covering the fiscal years ending March 31, 2003 through 2007, entitled the "Fuji Dynamic Revolution-1" (FDR-1). In May 2004, FHI announced its new forecast for the coming three years, from FY2005 to FY2007, in consequence of reviewing the past two years results and variable factors.

Under the FDR-1, FHI sets the vision of becoming "a global player with a premium brand," retains the direction of becoming an attractive company with strong market presence, and then aims to boost its profitability by strengthen the Subaru brand with accelerating a total brand strategy. Over the next three years, FHI will concretely work out challenges to "create new value," to convert price competition into value competition, to offer excitement beyond customers' expectation, and to be the category leader.

Fuji Dynamic RevolutionPDF/2.3MB


Consolidated target figures (FY 2007) (in 100 million Yen)
Sales 17,200
Operating income 910
Ordinary income 850
Net income 480
Interest bearing debt 4,200
Estimated exchange ¥/$ rate ¥105/$
Non-consolidated Sales volume target in FY 2007 (in thousand units)
Japan 324
N. America 268
Europe 61
Other 62
Overseas 391
TOTAL: 715


1. Launch New Category Models

  • North America: New XUV (New X-over Utility Vehicle)
  • Japan: New model launch

2. Reinforce sales network

(1) Establish the 320,000-unit sales network in Japan
  • Expand Subaru outlets (FY 2004: 544FY 2007: 600)
  • Leverage sub dealerships, "Subaru Shop" program (FY 2004: 209FY 2007: 250)
  • Strengthen sales force (FY 2004: 4,300 personsFY 2007: 5,000 persons)
  • Improve sales quality (utilize sales training program at renewed facility)
(2) Establish the 250,000-unit sales network in U.S.
  • Increase the ratio of exclusive dealerships and standardized showrooms with Subaru brand identification ("Signature Facility") (exclusive + separate showroom dealership CY 2003: 360/585 62%CY 2006: 450/600 75%)
  • Marketing strategy by regions (develop Subaru dealerships at 14 key target cities in the sunbelt and promote high performance line-up)
(3) Other regions
  • Europe (Improve functions of Subaru Europe N.V./S.A., and develop sales network in Eastern Europe and Russia)
  • Australia (Utilize the mega-dealer for strengthening the brand and sales)
  • China (Enter into Chinese market and establish the Subaru brand with products built in Japan)

3. Overall cost structure revolution

  • Establish Cost Planning and Management Division (production model: previous plan 12% in 3 years16.7% in 3 years, newly developed model: 35% reduction, and investment efficiency: improve 30% over original plan)
  • Innovate production control system (improve the lead time: 41.5 days20.5 days)
  • Promote SIA plant efficiency (improve productivity of the new Legacy, introduce the new XUV, and closer connection with SOA sales)

4. Strategies of three in-house companies

Aerospace company
Raise profitability in the early stage for the new project (B7E7, Eclipse 500, CX/PX etc.)
Industrial products company
Expand the line-up of high-value added products, develop a strategic production scheme in Japan, US, and China.
Eco technologies company
Joint development of next generation sanitation truck with ShinMaywa Ind. Ltd., expand sales of wind turbine generator systems and intelligent robot technologies