Subaru's FY2025 Profit Plummets 90% Amid $380M EV Transition Impairment Charge

Subaru released its financial results for fiscal year 2025, reporting revenue of JPY 4.785 trillion, up 2.1% year-over-year; operating profit of JPY 40.1 billion, down 90% year-over-year; and net profit of JPY 90.8 billion, a 73% decline from the previous year. The sharp drop in profits was primarily driven by higher costs resulting from U.S. tariff hikes, increased R&D spending on new models, and losses associated with its electrification transition. During the fiscal year, Subaru recorded JPY 57.8 billion in asset impairment losses related to battery electric vehicles (BEVs). Due to shifts in U.S. EV policies and slower-than-expected market growth, the company failed to meet its BEV sales targets, has postponed its in-house BEV development project, and is reallocating resources toward expanding its internal combustion engine vehicle lineup. In the same period, Subaru’s global consolidated production totaled 880,000 units, down 7.0% year-over-year, while global sales reached 896,000 units, a 4.3% decrease. Domestic production in Japan declined due to temporary plant shutdowns for electrification-related upgrades, while overseas sales were affected by disrupted maritime logistics caused by heightened tensions in the Middle East. Separately, Honda also announced in 2025 that it would record over JPY 1.5 trillion in losses tied to its EV business and revise its strategy—abandoning its goal of achieving full electrification by 2040 and instead focusing on hybrid-electric technology.