Subaru Made in Japan Defies Trend as Fuji Lifts Output

Fuji Heavy Industries Ltd. is making a contrarian bet: The maker of Subaru cars is cranking up domestic manufacturing at a time other Japanese automakers are expanding overseas to escape the strong yen.

The carmaker said this month it plans to increase Japanese production to account for 78 percent of output during the fiscal year ending March 2013, compared with 73 percent the previous year. Fuji Heavy said that expanding capacity in Japan --instead of the U.S., its biggest market -- is cheaper.