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July 10, 2024

Subaru Distributor In Dire Straits As Parent Company Issues Profit Warning


Tan Chong International (TCIL), the parent company of Motor Image, the distributor of Subaru in various ASEAN countries, including the Philippines has issued a profit warning to investors. The publicly listed company says profits have dropped 86.6 percent due to “problems with its automotive business.”

In a statement addressed to the Hong Kong stock exchange, where the company is listed, TCIL says its profits after tax fell to HK$25 million compared to HK$187 million in the same period last year—an 86.6 percent drop. This has been attributed to a “severe drop in sales,” with significant losses in its CKD markets Malaysia and Thailand and CBU markets Taiwan, Singapore, and the Philippines.

The severe shortfall in sales have played a part in Subaru’s decision to halt CKD assembly in Thailand. The markets served by the CKD plant will transition to a completely built up (CBU) model starting next with cars being imported from Subaru’s factories in Japan.

Despite the “very challenging circumstances,” TCIL maintains that its overall financial health and operational readiness remain “stable and robust.” It also expects to bounce back in the second half of the year, judging from the “relatively strong” number of bookings in its automotive division.

Details of TCIL’s financial performance will be published in greater detail before the end of August 2024.

Read the official announcement here.

34 comments:

  1. I guess its Toyota's mistake to control Subaru than if the latter were part of Nissan even after merging with Renault in 1999, so far as only few people know knew about Subaru's rivalry with fellow compatriot and Nissan associate Mitsubishi - with the Impreza WRX/STI and Lancer Evolution, then it would be interesting to believe that Toyota selling off Subaru (also Mazda, Suzuki and Isuzu) to Nissan may expect that Nissan would also bring Subaru, Suzuki, Isuzu and not Mazda out of business - probably Nissan may use Suzuki, Isuzu and Subaru's assets not only to revive Mitsubishi since it is was lucky for the latter not to leave the US and Canadian markets... (But also in turn Nissan would use those aforementioned brands' assets to revive and protect Nissan itself as to no avail there would be no problem if there were no Imprezas, no Foresters, no Jimnys, no D-Maxes, and more X-Trails and even Outlanders to say.)

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    1. Well, I honestly don't think Nissan would revive its relationships with Subaru, Mazda, Suzuki and Isuzu, but to Toyota, I think it would be sincerely better for them (Toyota) to take over Ford in both ways - financially and technologically - just as Toyota uses Ford as the alternative to Subaru. (Unless if Toyota would also recommend itself to supply Suzuki's cars to Ford so that people could own an Ertiga/XL7 with a Ford badge and drive it like a FWD-only Crosstrek/Forester...)

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  2. Severe drop in sales is good news for car buyers as it could force them to lower the price

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  3. I mean, their vehicles aren’t exactly cheap to sell a lot.

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  4. Subaru's have gotten prohibitively more expensive these past few years. They priced themselves out of the market.

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  5. Probably explains the recent massive discounts on the Crosstrek and Forester?

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    1. Including BRZ and WRX as low as Php1.9M - Php2M

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    2. RG, what's your source? And don't tell me that "go to casa to ask" BS

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    3. No one believes a word you say here anymore. I mean, you claim to have owned a Ford but can't even mention the model.

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    4. And I still enjoy how it consumes you even up to this day ๐Ÿ˜‚

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  6. Subaru aside from the price being expensive it is very impractical in the long term usage as it is very expensive to maintain. For example there is nothing special in buying a forester if you can buy a fortuner 2.8 Q 4x2AT in around 2.1M which is packs a lot of power aside from being a true SUV.

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    1. There's nothing special nor prestigious in buying a made in Indonesia Toyota Fortuner which still suffers from mediocre ride quality aside from having bad and unsafe handling
      Subaru Forester made in Japan is a much better SUV

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    2. 6th generation Subaru Forester is being sourced in Thailand, being manufactured at Tan Chong’s assembly plant. If forester is better than fortuner, why it is not well accepted in the market? Nothing special with the forester and better forget it, Subaru is a dying brand accept the fact and move on.

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    3. What are you talking about? Forester for PH market is being sourced from Japan. With the closure of the TCIL plant in Thailand, the all-new Forester (rumored to enter the market late this year) will also be sourced from Japan now.

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    4. "For example there is nothing special in buying a forester if you can buy a fortuner 2.8 Q 4x2AT in around 2.1M which is packs a lot of power aside from being a true SUV"

      LMAO this guy just really said that ๐Ÿ˜‚๐Ÿ˜‚. The Fortuner/Montero/whatever PPV sell because they were built with cheapness in mind, which is why they sell well in ASEAN markets. They are basically glorified AUVs that aren't even offered in first world markets due to their poor driving dynamics, poor performance and safety, poor comfort, and horrid interior quality.

      The Forester competes with the RAV4 and CR-V. The Forester doesn't sell well for the same reason the RAV4 doesn't sell well as the Fortuner here in PH. Ask also yourself: why doesn't the RAV4 sell as well as the Fortuner? You've also got your answer why the Forester doesn't sell well compared to the Fortuner/Montero/PPV.

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    5. PPVs the like of Fortuner and Montero are well accepted in our market because those are mostly suited in the desire to have a SUV (which both mentioned are in PPV) at 2.1M price in the country. The point there is within the price range, the Forester is quite expensive so what is special with it para bilhin mo witn 2.1M? How may units they sold last year comparing with the 570+ Rav4 and 1100+ CRV units sold? You can barely see new gen Forester on the road hahaha mabuti pa nga ang Jimny kahit mahal mabenta kasi special hehe gets mo ang point?

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  7. The cars a no longer vibrant unlike before like forester sg units, 225 hp with pro drive transmission which were tunable to 300 hp!

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  8. Not knowing your customers will be the downfall of every business. People buy subarus because its made in japan, not because its a subaru. The moment they offered thailand made units priced like it was still made in japan, thats when buyers turn to other brands. Even a sales agent of subaru told me that the previous gen xv is way better than the current crosstrek.

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    1. Subaru in the Philippines mostly sell made in Japan vehicles except for the slow seller Evoltis which is made in America

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  9. Maybe the release of the fastest quickest subaru wrx project midnight might save them..

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  10. well, subaru (and mazda) prices are a premium (muy expensive) compared to other japanese makes. aside from the fact, these 2 have fewer dealerships. subaru and mazda are way down in the totem pole for vehicles sold. but at least subaru and mazda (especially the former) are quite popular in north america

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  11. 5 yrs ago u can buy the cheapest Subaru at 1.3M now the cheapest is almost 2M

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  12. Subaru has to play catch up with hybrids and needs some smart strategy moving towards the electrification era.

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  13. Subaru dumbed down a lot since Toyota meddled with the management of Subaru
    Subaru focused too much on pleasing the American market,producing vehicles with terrible interior and exterior designs, reliability barely improved and pretending to be the Asian version of Volvo
    Subaru is left behind by more advanced and progressive Chinese car manufacturers

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    1. I think it would be honestly better off for Toyota to acquire Ford than to have the former do business with Subaru - and as well the rest to say, especially while Subaru's logo is similar to that of Ford, then Ford and Subaru in the 1990s used to share automatic transmissions with Nissan - as Nissan used to own Subaru just as Nissan used to supply half of its automatic gearboxes to Subaru, Mazda, Ford, Suzuki and Isuzu during that period. Also I even find Ford as a bigger and better alternative for Subaru as a Toyota partner since both carmakers are were World Rally Championship participants, with Subaru no longer in the series while Ford and Toyota currently competes there... (So I hope this these helps too.)

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  14. Subaru cars are just plain expensive. I don't think buyers ask where it is made. Pricing is the main problem. And BTW Subaru buyers doesn't cross shop for a Chinese car. Not everybody is swayed by many features and technology. Tbh a Huawei and flagship OPPO or vivo has more features than an iPhone but most still prefer iPhone.

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    1. Phones are different from cars.

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  15. Mental fortitude of a 5 year old visual shapes only.

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  16. Subaru's are simply not ASEAN focused. ASEAN consumers have different needs and preferences. Mostly, consumers want affordable and practical vehicles, never mind refinement, driving dynamics, comfort, etc. As long as it is spacious with good after sales support, it will sell.

    Cleary Subaru hasn't paid attention to this, likely because these ASEAN markets are small fish compared to America or Europe. They will lose just a little by letting go of these small markets (basically the writing is in the wall when they halted assembly in Thailand) and gain more by focusing on the bigger deceloped markets. Funny enough, their position is the exact opposite as where Mitsubishi is right now. Mitsu will likely be letting go of the developed markets soon (gone from China, Europe, and I'm pretty sure USA next) but still doing well in ASEAN.

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    1. Mitsubishi Motors already said that they will continue their business operations in the American market and Europe
      Subaru is mainly focused in the American and Japanese markets

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    2. Similarly, even Hyundai/Kia from South Korea and Stellantis (Peugeot) couldn't try to manage themselves by increasing their presences in the Southeast Asian markets, nevermind about Hyundai/Kia, so even if Stellantis were already owning Mercedes-Benz since the two European carmakers are deeply relevant in both ways than Subaru and Hyundai/Kia - most likely a merger of Mercedes-Benz with Stellantis would only have the Europeans focus more on its home market because most of Stellantis' brands (except Jeep) are based in Europe and I also think that Peugeot for example has models acting similarly with Subarus except that the French Peugeot does not use 4WD as the German Benz products are. (Not to mention Stellantis' takeover of Mercedes-Benz would only lead to Fiat/Maserati/Lancia/Alfa Romeo and Chrysler/Dodge/Ram/Jeep to go out of business as Mercedes-Benz already has more sales than them, Opel/Vauxhall and so far Peugeot/Citroen...)

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    3. A year before Mitsubishi Motors ceased operations in China, they also said that they will continue their bussiness there... well look at them now. Based on their North American lineup, it's not a matter of if but when they leave the North American market.

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