Subaru Shakes Up Top Execs after Inspection Scandal--Report

After it was caught cheating on safety inspections in 2017, Japanese car maker Subaru is now shaking up its leadership ranks in an attempt to build trust and confidence, according to a report.

Subaru said that it wants to build trust and confidence. 

The report said that Tomomi Nakamura, who has been the chairman and CEO of Subaru America since 2014 and a corporate vice president, will be Subaru’s president after the shareholders meeting in June. President Yasuyuki Yoshinaga will leave his post to take the helm as chairman.

Among the six internal board members, three will step down. The three will include incumbent Chairman Jun Kondo.

Subaru’s original plan was to appoint a new set of executives in 2019. This was changed in October when the automaker admitted that it had hired unqualified workers to do the final vehicle inspections. Thus, they have violated government regulations.

The final inspections were said to occur at the company’s main Gunma manufacturing complex in the northern part of Tokyo. This eventually led to the recall of 395, 000 vehicles. Yoshinaga also decided to give up a portion of his salary.

Afterwards, Subaru announced in December that it was conducting a probe into suspected employee falsification of fuel consumption data among vehicles awaiting shipment. Shares slipped to their lowest level during this period.

According to the report, Yoshinaga said that the scandals arose on internal oversight that was slacking during a time when earnings were bullish. As an incoming chairman, he would continue to spearhead efforts that will prevent the same mistakes and build the public’s trust, the report said.

Yoshinaga will remain the representative chief executive officer. The 63-year-old Yoshinaga has been credited for lifting the global vehicle unit sales 70 percent over seven years. He is also credited for doubling the sales value during that period. He supervised the group’s back steps from the minicar and industrial machinery business.

Meanwhile, Nakamura is responsible for the supervision of overseas sales. He also serves as the chairman of Subaru’s American arm.

The US car market accounts for around 60 percent of the car company’s global unit sales. Subaru had planned to announce its medium-term business plan through 2025 in the coming spring. However, the release is likely to be held up until summer as the specifications will be adjusted to reflect Nakamura’s leadership, the report said.

Subaru executives are expected to make informal, unconfirmed decisions on the reshuffle on Friday.

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