What Does Subaru Know That Others Don't?

nippononly

One thing I forgot to mention before is that it's clear a good part of their success in the U.S. can be traced directly back to their efforts to involve the U.S. dealers in North American product decisions. A very smart move.

I don't think there's one bizarrely-styled vehicle in the entire Subaru lineup for 2010. How long has it been since the last time we could honestly say that??!!

oregonboy

umm, like... forever, man!

Mr_Shiftright

AWD *does* hurt MPG. It's not only a perception, but a reality. :P

ateixeira

This was the surprise to me:

About 90 percent of the brand's dealers are profitable. And those prosperous dealers gave Subaru the second-highest brand rating in the last two dealer attitude surveys, conducted in the past year by NADA. Only Lexus did better

Any dealer making a profit in this economy has gotta be excited for the recovery.

oregonboy

I recall a time in the distant past, when Audi was pioneering full-time AWD. They tried to sell the idea that AWD could actually improve fuel economy because, at steady-state speads, a driven (powered) wheel has less rolling resistance than an undriven one.

Either that turned out to not be true or the gains were insufficient to offset the losses due to increased weight and mechanical inefficiencies. In any case, their "AWD can save fuel" argument quickly disappeared.

ateixeira

We have to look no further than dyno tests for drivetrain losses.

Mr_Shiftright

No matter how efficient, tricky and high-tech cars become, the basic laws of physics do not get repealed.

If you build an AWD box with high ground clearance and good storage capacity, you have to pay for that in energy.

Which is why, to me, diesels in AWD vehicles is attractive (but apparently not for automakers marketing in the USA).

ateixeira

Subaru showed Edmunds a diesel Forester, I think Erin drove it IIRC?

6 speed manual, even.

rsholland

Yeah, and she wasn't that wild about it.

http://blogs.insideline.com/straightline/2008/09/edmunds-drives-forester-diesel.- html

Bob

Mr_Shiftright

It sounds like it was engineered for the European market. It has things that Americans can't cope with, like a manual transmission and looking at a tachometer. :P

Gee, who cares if it's a little slow? 38 mpg and a 4,4000 lb towing capacity? That's pretty impressive.

anythngbutgm

I've drove a loaded 2.5X with a stick when they first came out and the acceleration on that thing was painfully slow off the line. Once the tach pulled past 1500 RPM though the engine had acceptable grunt. Not quick, but acceptable.

Point is, I think the instantaneous torque alone would be a step up from the base engine.

I still wish for an X/T with a stick even more though

nippononly

I would take one in a heartbeat! When I did my first survey after I bought the new OBS, I told them the next one had better have an optional diesel, because I wouldn't be a repeat customer if it didn't use AT LEAST 30% less fuel than my current car does. I just don't understand why Subaru doesn't get this.

Mr_Shiftright

Well you could buy a TDI Sportwagon, which is a nice car, but no AWD and also you might end up in VW hell.

nippononly

Yeah, forget that.

I want to go Japanese again, because the only domestic choices with AWD are crossovers and have fairly lousy mileage anyway.

But all the Japanese hybrids drive like a wet noodle, and the only one with seriously good fuel economy is the Prius. FWD, cheap interior.

Mr_Shiftright

Problem is that the diesel car market has never been very strong in the USA--in its heyday, only 6% of the market---and that would have to be split by anyone offering a diesel option. So it's pretty slim pickins', given that one would have to design an engine to meet US emissions specs. New engine development is horrifically expensive.

nippononly

And yet there isn't a company we have mentioned that doesn't offer diesels in the exact same models in other countries.

We have never really tested just how much penetration diesel could make if there were multiple automakers with several diesel offerings here.

But either way, that's fine - Subaru should bring on a hybrid with really good mileage then. And they need it YESTERDAY.

Mr_Shiftright

Americans hate diesel cars, generally speaking I mean. They are associated (quite wrongly of course) with smoke-puking buses, or with weirdos who also drive recumbent bicycles or pour peanut oil into their gas tanks. :P

It's going to take quite an ad campaign to bust through 30 years of misconception. Also, I don't wish to beat a dead horse, but GM certainly helped to sour Americans on the diesel passenger car.

british_rover

When I started at this autogroup almost five years ago only one store was consistently profitable across all four areas parts, Used sales, new sales(profitable for a new side operation is breaking even as you almost never make money on the new side) and service. That store was the Subaru one. They would cut it close on used car sales sometimes because they just focused to heavily on new but they always ended up profitable in the end.

Our Rover store made money on the new side literally hand over fist but lost all that and more in used car and wholesale losses. Service of course made up for that so that the store itself was profitable but the sales side usually wasn't.

ateixeira

Subaru is the anti-bling. Bling was hot a while ago, but now it's ... tacky. Inappropriate.

When was the last time you saw a Hummer with chrome wheels? That wasn't vandalized, I mean.

The downturn actually helped Subaru. They've had 2 consecutive years of growth.

w8ifi

I'd like to see a good survey of Subaru vehicle owners to indicate how many people would like a diesel Subaru. Maybe even have a general survey of car owners. Make sure they understand the mileage advantage. I think there is a heck of a lot more demand than they realize. If I have the money when they offer one I sure would buy one.

Jim

ateixeira

The problem with that is that people will say they'll buy it, then they won't.

That's how the Pontiac Aztek made it to production. Seriously. The tent seems cool. Sure, I'll buy it. Then noone did. Well, that plus the concept was actually cool, and not nearly as ugly as the final product.

I'd say yes to a survey like that, as in yes I'd be interested to test drive one.

Would I buy it?

Dunno. Regular gas is $2.649. Diesel is an absurd $3.149. This is one of the few stations in zip 20854 with diesel. 20% more nearly negates the 20-40% efficiency gains.

So I would have to go out of my way to find affordable diesel. Ain't happening in real life.

Mr_Shiftright

I agree. I think any automaker who trusts an American carowner consumer survey and puts out a diesel is going to be left hanging out to dry in the marketplace.

morin2

Yes, its easier to say we'd buy something when its a concept, but when it comes right down to opening the wallet, it can be a different story. I've responded to a couple of SOA surveys and given the highest interest in a diesel subaru. But then again, I'll openly admit that I told VW in a survey that I'd be interested in the New Beetle - when it was still a concept (and I did not buy one).

I think there's more to the diesel factor than comparing the cost of diesel to gas and calculating the fuel cost/mile. In my case, I could replace 2 gas vehicles with 1 diesel - provided the diesel could realistically tow my boat, as I now keep a pickup mostly for local boat towing duty - so there would be a savings going from 2 to 1. It would be hard to part with my Outback, but if the EPA allows for the further adulteration of our gas with ethanol, and there's a diesel Subaru available, that would be very tempting - although the boat may also be sacrificed if I can't find acceptable fuel for it either.

Subaru is making the correct business decision for Subaru by not bringing the diesel until it can be sold in every state.

Mr_Shiftright

When gas goes back up to $4 / $5 a gallon it would be a whole new ballgame perhaps, but for right now, I agree, it would not be wise for Subaru to develop a diesel engine for the USA/50 states. We already have at least 2 players splitting a very small pie.

morin2

To me, there's more to it than the cost of the fuels. If the EPA allows 15% ethanol in our gasoline, its an experiment with engine longevity and performance - at our expense. I would be willing to pay more per mile with diesel fuel in the short term if the trade-off is better engine longevity and performance for the long term. I think most people don't care about what is in their gas until they have a problem. Boaters are better informed on this issue.

nippononly

ateixeira

I can think of a couple - range and towing.

I hate having to go get gas every 5 days. The Miata has a small tank, so if I drive around a lot, it seems like I'm always running on empty. A 500+ mile range would be nice.

I *HATE* when a hybrid has a small gas tank. Totally defeats the purpose. :sick:

Nearl 17 gallons in a Forester, at 40mpg, would give you 680 miles or so. Do NOT make the tank smaller, like VW did for the Passat TDI, and like Toyota does for some of its hybrids.

Towing is another benefit, but I wonder if the 6 speed manual would be well suited?

Diesel just crept up to $3.199. :mad:

morin2

Exactly. I'd be skeptical about towing with a MT - especially for pulling a boat off a ramp. Flatland towing might be ok, and the MT would allow you to optimize shifts for the load. I'd want an AT to have a tow/haul mode like trucks do now, or at the very least, an OD turnoff button.

stever

I think any automaker who trusts an American carowner consumer survey and puts out a diesel is going to be left hanging out to dry in the marketplace.

Or someone like my wife could be on the focus group. She has mild asthma and diesel fumes get her. Gasoline isn't so bad, but she doesn't want anything to do with diesel. Now a hybrid - that she'd like.

There's a long discussion about diesel in the States over in Diesels in the News.

Mr_Shiftright

Well sure if I ever start having trouble with gasoline blends, I'd consider a diesel Subaru. But I never have had any trouble, even in Calif.

Boat people have trouble with everything. :P Even if they gave me unlimited free aviation fuel I could barely keep up with the cost of maintenance and the mechanical issues with a boat. I once thought of changing my boat's name to "Feed Me".

In this age of treacherous waters in the automotive seas (nice but corny segue), an automaker has to be very careful about any costly innovation or marketing change. Look at poor Saab, now a dead duck and once the same quirky, beloved niche vehicle as the Subie.

Visiting Host

ateixeira

BOAT = Bring On Another Thousand

If you find keeping a car running expensive...imagine a marine version of the same.

The diesel Subaru sells now in Europe does not meet CARB standards, so they'd have to add urea injection (and a grand to the price) to sell it here.

Tough sell, at least for now.

Mr_Shiftright

Rule of Thumb for American Market:

Never sell a product here where the owner has to add a critical fluid periodically, and if there is a critical warning light or chime, make it as loud as a railroad crossing alarm. :P

nippononly

Subaru's 33 percent gain last month pushed its industry-leading advance for the year to 15 percent.

http://www.autonews.com/apps/pbcs.dll/article?AID=/20100105/RETAIL01/100109984/1- 400#

The only company doing better year over year was one with 1/5 the sales: Jaguar Land Rover.

And how about that 33% single-month gain at Soob, eh? ;-)

Mr_Shiftright

What's interesting is that Subaru survived some very bad PR (bad head gaskets) and struggled with (some might say still struggling with) styling---or lack thereof.

You'd think they would have ended up like Saab----an obscure also-ran. But somehow they have maintained the ability to LOOK DISTINCTIVE in the marketplace----and a very cluttered marketplace at that.

stever

The B9 was certainly distinctive. My wife spotted one of the early ones in a rental lot back in their first year out, and asked me if the Edsel had been reintroduced.

I sort of like the Baja, and you have to admit it certainly looks distinctive too.

Subies are good weather boxes to own without having to drive a big honking SUV or pickup around. And the WRX and all the rally events gave Subaru tons of good press. Dunno, something about them engenders lots of loyalty with owners. High perceived bang for buck?

ateixeira

Tribeca was a major part of their upscale push, which failed.

SoA executives fought parent Fuji hard to stop that push. That's when things turned around.

The 2008 Impreza, then 2009 Forester and 2010 Legacy/Outback were the results of that new value-based strategy. The price of the base Forester dropped by some $1200, and they were able to do away with rebates.

The 08 WRX stumbled out of the blocks, but in 09 they added power and some content and since then they can do no wrong.

Mr_Shiftright

Well Subarus aren't CHEAP per se but I guess they ARE cheap for an AWD, high-clearance wagon with most creature comforts.

I'd say the perception of reliability (which Subie advertising exploits) is also a driver in sales.

I say "perception" because the 2.5L engines did hand-grenade for a while (all betta now).

stever

I say "perception" because the 2.5L engines did hand-grenade for a while (all betta now).

I do worry about my '97 Outback a bit.

nippononly

to how much you can charge for what are essentially quirky, different vehicles. The death of Saab proves that the limit is below $30K (!!), so I'm really glad Subaru abandoned the idiotic "upscale push". I want this company to be around for many years yet.

While Subarus have historically been very durable and pretty reliable (with the major hiccup of the 2.5L head gasket problems and the wheel bearings on some Legacys, all around a decade ago), it has certainly helped their rep for reliability and value that they are Japanese. They get some help up from Toyota and Honda, as many people lump them all together.

nippononly

I didn't realize it but Subaru is about to pass VW in sales in the U.S.!!

Thanks to torque_r posting in the GM thread, we have the numbers for calendar 2009:

VW:---------------- 223,128 down 4.3
Subaru:------------ 216,652 up 15%

Go Scooby! :-)

rsholland

According to AutoBlog, Subaru did pass VW (216,652 vs. 213,454).

http://www.autoblog.com/2010/01/05/by-the-numbers-2009-up-and-down-year-ends-dow- n-for-most-editi/

Bob

Mr_Shiftright

As it should be. VW corporate should be mortified at its reliability ratings.

ateixeira

You hit the nail on the head - once you equip the competition the same way, then you see the value.

A Camry or Accord may seem cheaper than a Legacy, but compare a Crosstour or Venza. I compared loaded six-cylidners with AWD and the Subie has a $2-3000 price advantage.

No wonder they can't make enough Outbacks. That plus the Crosstour is painful to look at.

Mr_Shiftright

A failing car company has wishes, a successful one has purposes.

nippononly

Subaru's next strategy involves stealing Accord customers, as that automaker has "lost its focus":

How will Subaru build on its new record sales? Look out Honda and other big-volume players.

Doll points to the Honda Accord's dominating 8- or 9-to-1 sales rate over the Legacy as a ratio ripe for picking. He said as industry sales volumes begin to return in coming years, Subaru will have the opportunity to leverage its strong brand attributes to conquest buyers from bigger brands that may have less focus.

http://www.autoobserver.com/2010/01/subaru-plots-follow-up-of-2009-success.html#- more

Now that Legacy actually has better fuel economy than Accord despite the AWD, they might be able to get something going there. But corporate will need to put out a memo to the dealer body: STOCK SOME LEGACY SEDANS!

My dealer never has ANY in stock. He is the WRX/Forester/Outback dealer. The lesser Imprezas, the Legacys, the Tribeca, might as well not exist at all. This is true for all but the very biggest dealers here in the Bay Area.

Interestingly, the article mentions that they expect to sell a hybrid in the 2012 MY, and that it will NOT be the HSD system from Toyota, as that won't work with a boxer engine.

And of course, they won't quote their new sales targets, thank goodness; when have they ever hit them after announcing them in the past?? Better not to jinx things... :-)

backy

Yes, that makes sense, and explains why the new Legacy looks so similar to the Accord.

ateixeira

I just hope they don't get complacent, and keep improving the products.

Let's see a CVT in the Forester, and maybe a 6 speed manual as well (in the turbo, too, by the way).

Next? DI for the engines.

nippononly

Next? DI for the engines.

Yes, that's going to be overdue if it doesn't arrive very soon.

ateixeira

GM and Ford have started, at this point everyone who hasn't is falling behind.

backy

Uh.. don't forget Hyundai. You don't see DI engines in GM's and Ford's bread-and-butter sedans as you do on the new Sonata.