Subaru Delays EV Development Due to Low Demand

Subaru has a solid EV lineup. It's arguably got one of the more fleshed-out offerings among smaller brands, courtesy of the automaker's investment in a partnership with Toyota. The plan, at least originally, was to use this portfolio of Toyota-co-developed EVs to hold the brand over until its own bespoke EVs could stand on their own two feet. Now, facing an electric vehicle desert in the US, Subaru has decided its current crop of EVs will do just fine, suspending development of its own EVs.

Subaru didn't have a hard timeline on this crop of next-generation, bespoke EVs, but the end result is the same: the plans have been postponed. Per Automotive News, CEO Atsushi Osaki said that a lack of demand in the US is the reason for the shift. It's not the first time an automaker has said this. Plenty have since September 2025, when President Trump upended the EV market by suspending tax subsidies and infrastructure investments under his One Big Beautiful Bill Act. Subaru is the latest among scores to pull EV plans from the US, where gas-powered cars still dominate sales.

"Given this, the timing of our BEV market introduction will be pushed back. We want to begin a comprehensive re-evaluation of the entire strategy, including which models to bring to market," said Osaki. Subaru has said it will still develop "core" components for eVs, but will "significantly reduce the resources allocated to this effort." The maneuver comes at a cost to Subaru, leading to a $363.9 million write-down. It's not quite as big as those from major domestic automakers, but for a smaller brand, the sum will feel larger. Without incentivising consumers to consider the benefit of EVs over their gas cars, federal policy has, in part, contributed to the decline in EV adoption in the US. However, even with subsidies, margins on EVs were thin.

This story was originally published by Men's Journal on May 20, 2026, where it first appeared in the News section. Add Men's Journal as a Preferred Source by clicking here.

2026 The Arena Group Holdings, Inc. All rights reserved.

This story was originally published May 20, 2026 at 8:53 AM.