Subaru's fortunes sinking - can they turn it around?

ateixeira

Yeah, GM really wanted them for the Duramax diesel.

And think about what it did for GM - they have a fine diesel in their big trucks, plus they even supplied diesels to Honda in exchange for Honda V6s that you will find in the Vue Redline.

Now Honda is making their own diesels, and who knows how much longer GM will keep Isuzu around. They basically milked them for all they were worth and starved them of any R&D funds.

That has not happened with Subaru, thankfully. I honestly hope GM sells their share of FHI because Subaru has not benefitted one iota from this synergy.

-juice

varmint

... go back and read Nippon's opening for the thread. I think that post sums up the "tone" of the discussion, as well as define the scope of the question (US vs global). I, for one, did not think this discussion was focused on the sky falling around Subaru's ears. It is simply focused on them not meeting their goals.

varmint

Thanks for the link, Bob. That actually sites US sales of ~201K units rather than the 204K from the May 18th article Nippon posted.

It appears to me that Subaru expects the Tribeca to be the primary mover in these revised sales goals. 204K minus 17K equals the usual 187K they've been getting with their current product line.

I think 17K is doable for the Tribeca. In fact, they may do more. I'm not so sure it won't put the hurt on Legacy and Outback wagon sales, though. Not in a big way. But I think it will make it harder for dealers to sell the high-end wagons. Overall sales of the wagons may be off by something like 2-3%.

In the end, it's a gain. No question. But managing four models to generate 200K in sales is a tough row to hoe.

varmint

Good point regarding the factory use. Of course, I'm sure Subaru wasn't building those Isuzu's for free, but the profit margins must have been paper thin.

ateixeira

Aren't they always optimistic?

I think the Tribeca forecasts are, for once, low. 17k for the first year, and they already have 600 pre-orders.

Fact is, if Baja had been a success, we wouldn't even have this thread. Baja was the only new product to pick up the slack left by the Rodeo and Axiom. The Legacy and Outback were just updates of existing products.

I believe Baja was forecast to sell 20k, but it's more like a pace of 7-8,000. That's basically the shortfall from the forecasts.

Now, with the Tribeca, they can hope to have the volume to keep the assembly lines busy.

You have to spend money to make money, they're just starting to see income from the Tribeca investment now (this week).

-juice

varmint

"Aren't they always optimistic?"

Dunno. I think it depends on the company.

I think Honda forecast 80K units for the 1999 Odyssey. They forecast only 15K for the TSX and 40K for the Element. I don't know what the goal was for the first CR-V, but they had trouble meeting orders and had to shuffle factory usage. It looks like they'll miss the 20K expectation for the RL by a few grand, but that's the first time I can recall where they've missed.

I haven't followed Subaru close enough to know how conservative or loose they are with their numbers, but they are the first I've seen with three revisions. 285K down to 250K down to 201K. Perhaps the notion of a 5-year projection is simply not realistic. Now that I think about, the very first projection was made before 911.

As an aside, the Baja's performance could not possibly explain how they missed the first two goals. I do think the last is doable once the Tribeca is added.

rwoods

As much as it hurts to say it, I expect the end game for Subaru is to be taken over just like Saab and Volvo. And would this really be death?

varmint

The more closely I read these forecasts, the more I'm confused.

The AutoWeek article states...

"Subaru also has missed sales goals in North America. In June 2001, the company had set a North American goal of 285,000 sales in the fiscal year that ends March 31, 2006. That was later reset to 250,000. Now the carmaker predicts its North American sales that year will be 201,900."

Note they are quoting 201,900K North American sales.

The Auto Channel article Bob provided states...

The automaker is aiming for sales of 204,500 vehicles in the U.S. this year and is pinning its hopes on the new Forester and Legacy. CEO of Subaru of America Kunio Ishigami says in order for Subaru to reach its 2005 sales goal, it will need to sell at least 17,000 units of the new seven-seat B9 Tribeca sport wagon, which goes on sale next month.

This one is forecasting 204,500 units for the US only.

xwesx

The margins may have been thin, but there's a lot of fixed overhead just sitting there being subsidized by other products. Even if they had been producing them at a loss, if the loss was less than leaving it idle, the preferred choice would be to produce the vehicles. *shrugs*

xwesx

It could be..... it would all depend on the parent company. If it was GM the way GM currently operates, it would be the end.

lmacmil

Unless you live in the snow belt, most don't need AWD so why pay the $1800 or so premium? Performance is great on the turbo but gas mileage sucks. The Legacy is a tad smaller than the Accord/Camry, especially the trunk and rear leg room. The Legacy GT Limited too pricey for what you get, in my opinion. I think their management was wildly optimistic with their sales projections.

nippononly

"Problems I see?

* they need a cheaper version of stability control, and yesterday
* they can be nimble, but they really haven't, so it's time to start
* fix the marketing
* stop withholding the best technology (JDM market only)"

Boy, did you ever hit it on the head. It is unbelievable that in a market with stability control popping up everywhere, you have to give Subaru $30K to get VDC. Ridiculous.

"Live, drive, feel" or whatever their totally forgettable marketing slogan is, needs to go last week. Bring back Croc Dundee if you can't think of anything better than this. And as for nimbleness, they have demonstrated absolutely none, beyond responding to the SUV craze in the mid 90s with the original Outbacking of their Legacy wagon.

I question whether super-racy niche models with 14-word names ending in Spec B will do anything for them - they will have to compete with everyone and their mother for those sales, and they don't have the name for it.

Thank you to varmint for pointing out that I posted nothing about Subaru's being at death's door, just that SoA was splashing around in red ink that looks to be getting deeper this year, not shallower. Subaru could soldier on as it is for some years I think, but it needs to take a more realistic direction and follow it. It is trying to move WAY too quickly upscale - the market just doesn't buy it (literally!). I don't think the R2 is the car for the U.S. (no way!), but SoA could sure use something significantly under $20K.

And a shortfall of 12K Bajas obviously does not account for a 50K shortfall in sales projections. As varmint pointed out, four model lines is a lot of balls to juggle for a mere 200K sales per year. How did anyone at FHI in 2001 think that Subaru could grab 285K sales in North America in fiscal 2005? Do you know what kind of sales increases that would have meant? It would have blown Hyundai/Kia's phenomenal gains out of the water, I can tell you that. EVERYONE would have been talking about Subaru. I think they must have been knowingly faulty forecasts designed to mask the fact that they knew they were going to go into the red trying to launch a new model.

Anyway, if North American woes stem largely from losing Isuzu at the plant in Indiana last year, then this year should be the last when they run a large deficit. If Tribeca can sell 40K per year, things should look a lot rosier in April 2007. Obviously, a great deal depends on Tribeca. I saw one on the road in rush hour traffic this morning, with Mulroney sticker and dealer plates firmly affixed. It has a pleasing shape, despite the rather ugly nose. I truly truly hope GM doesn't buy these to sell as Saab 9-6s. That is a blow Subaru can very ill afford. The Autoweek piece sounded so definite, even naming a number - 15K per year.

ateixeira

Too bad about the RL, it's a fantastic product, the problem is its competitors (GS300, M35) improved tremendously right after Acura launched it!

I expect the end game for Subaru is to be taken over just like Saab and Volvo. And would this really be death?

AAAARGH! This is not a matter of life and death, it's MUCH more important than that! :surprise:

But seriously, I've vowed I will resign as Subaru Crew Chief if that happens and they become just another division of GM selling GM clones. There are too many divisions already. That would just be a travesty.

GM is at least giving Subaru a shot, unlike Saab. Plus ownership is just 22%, not nearly a majority. They had a majority of both Isuzu and Suzuki and do what they want with those brands (Suzuki selling Daewoos?).

if the loss was less than leaving it idle, the preferred choice would be to produce the vehicles

Absolutely, you have to try to employ those people that work at SIA.

Baja sales projections were for 20k per year initially, but I think they had that model's sales forecast growing too. Way too optimistic. Still, I'd never heard the 285k number, but you know how it is, different execs will throw out different forecasts, these aren't exactly official. Just like we see both 15k and 17k numbers for the 2005 for the Tribeca.

-juice

ateixeira

By the way, just because it comes out in a press release doesn't mean it's true.

If it were, this car would be named B9X. They actually went as far as announcing that would be the name.

But it's B9 Tribeca instead.

-juice

varmint

We're no where near that point. Subaru has plenty of chances to work their way back to profitability. I mean, look at how far Mitsubishi has fallen, yet they still have a great deal of control over their product line.

Besides, I'm not so sure that GM taking over Subaru would be in their best interests.

Back when Ford and GM started buying everybody up, people expected that the mega-merger companies would dominate. What happened? The independents like Honda and Toyota gained ground, while the big boys stumbled. In fact, now the solution everyone agrees on for GM and Ford is to down-size. (How to accomplish that is something no one agrees on, but that's another story.)

Lately, GM has been trying to get out of these arrangements. They just paid off FIAT so they could break their contractual obligation to buy them up.

Also, I think it's more likely that GM would leave Subaru's North American operations alone. They would get more mileage from Subaru using their experience in small cars to go after the market in China.

ateixeira

Paying off Fiat was smart, I think GM made a good deal even paying to get out of that mess.

I don't get why they bought Daewoo, to be honest, they have ton of excess capacity right here at home.

The Chevy Borrego concept never became a reality, remember that 2 seat pickup based on the WRX? The 9-2x is selling poorly compared to the V50 even if you exclude S40 sales. 9-6x might not even happen.

Neither side has benefitted. I say it's time to part ways.

-juice

varmint

"And as for nimbleness, they have demonstrated absolutely none, beyond responding to the SUV craze in the mid 90s with the original Outbacking of their Legacy wagon." - Nippon

Not sure I agree with that. The RAV4 hit the market in 1996. The CR-V followed in 1997. Subaru was next with the Forester. That's a pretty quick move into a segment. Take a look at how long it took the others to get there.

If you consider the Baja a legitimate stab at the personal use truck market, they were very quick to get in there. They just did it badly.

"Still, I'd never heard the 285k number, but you know how it is, different execs will throw out different forecasts, these aren't exactly official." - Juice

I think they may have been riding high on the economic forecasts of the day. That 285K units estimate was made before the US bubble burst. It was before the September 11th attack and before we really got hit by the recession. Actually, the downward economic slide started before Subaru made that announcement, but I don't think anyone would have projected it would slide so far.

"As varmint pointed out, four model lines is a lot of balls to juggle for a mere 200K sales per year." - Nippon

Yeah, it seems that every vehicle Subaru brings to market is a niche vehicle. The WRX is nothing short of incredible, but it's a low volume seller. As popular as cross-overs are, wagons are still not selling huge volumes. And, for whatever reason, Subaru's family sedans have never made an impact on the market. The closest thing they have to a successful mainstream vehicle is the Forester. But it still doesn't sell in the same volume as the others.

I really think Subaru needs to focus on mainstream models... soon. They need to get a high volume single nameplate vehicle to attract attention. Something like a Civic, Camry, Explorer, or Caravan. I'm not suggesting they target those markets, but they need a vehicle that is competitive with the entire industry. Something to say, "we're not just looking for table scraps".

The Tribeca could be the first vehicle to do so, but I have doubts. Their forecasts are low, their pricing/content strategy is too much like a "tweener", and (have to say it) the nose isn't going to win unanimous approval.

rsholland

if the GM partnership doesn't work out for Subaru, they would still need to partner with some other car company, as I think Subaru is just too small to go it alone.

The question is who?

I've always favored Porsche, as there are certainly many engineering similarities, and they are both specialized car companies. I know Porsche has no intentions of merging with another carmaker, and there's the issue that if Porsche "officially" partnered with a brand that is so much lower on the status ladder, that it could hurt Porsche in the long term. I'm not so sure I agree with that, but it is a valid argument.

Bob

ateixeira

Porsche tunes several models for Subaru already, and the boxer engine is something they have in common and virtually noone else does. Porsche even uses Viscous Coupling AWD systems.

But - I dunno, the hard part would be to get the German and Japanese leaders to work together, their management styles are very different.

Porsche is actually getting help from Toyota for its HSD technology.

And I could see FHI helping Toyota out to meet demand for Li-Ion batteries, though.

-juice

rsholland

More mainstream models? Subaru got their tails whipped when they tried to go head-to-head with Toyota and Honda back in the '80s and '90s.

I think they need to remain niche-oriented, but they need to find more niches that are more profitable. I would love to see a true AWD Subie minivan, sort of a long-wheelbase Tribeca that would comfortably seat 7 or 8 "adults." I still think a proper Ridgeline-like pickup would be a good move. I'm convinced the midsized pickup/SUV thingy (Ridgeline, SportTrac, etc.) area is ripe for exploration.

I don't see them offering cars to compete (head-on) with the Civic or Accord. Nibble at the edges, yes; head-on, no.

Bob

andre1969

that Subaru could design something like the Tribeca, and and only expect to sell 17,000 units in the first year. Seems to me something like that would have a much higher breakeven point.

nippononly

a better Jeep Wrangler? I could see Subaru doing that, and doing it well. That and a van (maybe) and a larger sedan, all using existing engines and platforms, should see them selling 300K+ per year before the decade's end. As much as I liked that little concept roadster last year (or year before?), Miata pretty much owns this segment, now Sky and Solstice are going to get here and eat up any leftovers Miata doesn't get - how many could Subaru sell?

varmint: yeah, I was in a bad mood when I wrote that! :mad:

Forester was a quick response to a market direction that showed promise, and the promise has paid off. Of course, the Forester makes the RAV4 look big, a rare feat to accomplish! It will be good, and not a moment too soon, when they give the Impreza platform a bit of a stretch.

rsholland

A better Jeep Wrangler? How many times have I asked for that over the past few years? Yep, I'd love to see Subaru do that too. Nissan (with the Xterra) has proven that there is a market for a good relatively inexpensive off-roader. Not everyone wants a crossover.

There are any number of niches to be further explored, or even discovered, that Subaru could/should investigate.

Bob

andre1969

as a station wagon with a raised roof, and as a result never really thought of it as competition to the CR-V or the RAV-4. To me it was more like a modern take on those old Nissan Stanza wagon/minivan hybrid-looking things from the 80's. If I were out shopping for a CR-V or RAV-4 or something similar, a Forrrester simply would not cross my mind.

davem2001

I agree about the Forrester - I think of it as a station wagon, not a "cute-ute" mini SUV like the CR-V or RAV4.

I like the idea above of building a Ridgeline competitor off the Tribeca - I think that maybe would work - the same basic idea as the Baja only better executed, bigger.

Basically, IMO, Subie already has a good niche carved out... they would be making a mistake trying to go too far "upscale"....and I still say the new corporate "face" is a disaster....hopefully they won't ruin the Outback/Legacy and the Forrester with it anytime soon.

kyfdx

I feel the same way about the Forester, but I think you and I are in the minority.. Most people consider them comparable, and consider the Forester and Outback to be SUVs...

I always think of them as wagons... not that there is anything wrong with that..

andre1969

I think I'm going to ask my buddy with the '98 Tracker what he thinks of the Forrester, to get his opinion. He likes the RAV-4 and the Xterra, two vehicles he'd consider when it comes time for a new ride. I'm gonna suggest he look at a Forrester and see what happens! :shades:

ateixeira

nippononly: OH NO, don't get Bob started on his Subaru off roader rant! :P

Subaru says most Forester buyers cross shop the CR-V, with RAV4 mentioned 2nd most often. So it has worked for them.

The 2006 got a slight lift (ground clearance is now 8.1" and the hood is taller) and the next generation will inevitably grow bigger. I think that segment is covered.

They'll do an Impreza based people mover, like the Mazda5 probably, but they should build a Tribeca based one, call it a minivan or Crossover Adventure Family Truckster.

Roadster? Dunno. AWD carries a weight and cost penalty, so with small cars like that it's tough to compete. As much as I love the B9SC concept (2.0T plus hybrid - drool!) I don't think it could be priced for commercial success.

Large sedan? For sure. There are a lot of people that have outgrown a Legacy and they don't want an SUV.

SUT? Dunno if they'll risk another, Baja has surely made them gun shy.

Other variations on the Tribeca? Keep in mind they patterned the Tribeca off the Legacy, not the Outback. So they could build an outdoorsy model with Outback-like features and spend very little on it. Maybe give it a raised roof and fender flares like the 1996 Outback got to differentiate it from the Legacy back then. Give it skid plates and lower gearing with bigger tires. Image sells.

Smaller cars? I think a 3 door Impreza would be small enough given the upscale image they want to project. Small cars have hurt Mercedes' image, for instance, and they've lost money.

-juice

andre1969

seems to be pretty dead at this point. Or, at least by compact I mean something sized in between a Neon, Focus, Civic, Corolla, Cobalt, etc (even though some of these probably ARE classed as compacts these days), but still not as big as some of the smaller midsizers like the Chevy Malibu, Dodge Stratus, etc. Cars that used to be in this field have either fallen to the wayside (Ford Contour, Saturn L-series, etc) or grown much larger (Accord, Camry, Altima). Unless I'm forgetting something, it seems like the Mazda6 and the Subaru Legacy are the only cars left in this in-between size. And neither one seems to be setting the world on fire when it comes to sales.

I think the main problem is that these "fringe" cars really don't offer any real benefit over the larger midsized cars they have to compete with. They give up interior room and comfort, but really don't give you any improvement in fuel economy. They're not much, if any, lighter. This used to be a pretty popular class of car, but in recent times most of them have gone midsized. I'm guessing the Legacy will too, eventually?

davem2001

future products -

Yep, they could easily do an "Outback" version of the Tribeca - that's almost a no-brainer - cheap, simple, easy to do.

Large sedan? I sort of have mixed feelings on that - I'm not a huge proponent of moving far "upmarket"... If it's in the Avalon price/size range Ok, but no bigger or more expensive. I don't think Sube needs to make the same mistakes VW is making and come out with some $60K "flagship".

Roadster? I'd nix that - I don't think it fits the Subie image, overall

Pure off roader? I dunno - I think I would leave that to Jeep and Hummer

davem2001

I think the Ford Fusion/Mercury Milan/Lincoln Cimmaron are about that size, but I'm not positive.... Also, the new Jetta...but yeah, most (Camry, Accord, Altima, etc...) have grown over the years....

rsholland

I think future B9 spin-offs are a given; a larger sedan at the very least, probably others too.

Bob

nippononly

"Smaller cars? I think a 3 door Impreza would be small enough given the upscale image they want to project. Small cars have hurt Mercedes' image, for instance, and they've lost money."

The difference, of course, being that Mercedes was at the top headed down with the C-coupe, while Subaru would be at the bottom already and headed up - a smaller model could anchor that. Subaru will not be a luxury marque tomorrow, no matter what it wishes. Even VW, which I think more people buy as a quasi-premium brand with its current move upmarket, has the New Beetle to anchor the line. And that little car will become twice as important to VW now that they have overpriced the new Jetta.

davem: "Large sedan? I sort of have mixed feelings on that - I'm not a huge proponent of moving far "upmarket"... If it's in the Avalon price/size range Ok, but no bigger or more expensive."

Goodness no! If Sube even develops a new car the size of Camry, it will be a big step up in size from Legacy. Forget Avalon or anything larger. As mentioned above, Legacy and Mazda6 are at that half step below all the other midsizers and a little above the majority of the compacts. If they used the Tribeca platform to produce a model 1/2-3/4 step bigger than Legacy, that would be just about right. More families could consider a car that size. Especially if there were a wagon to go with it (hint hint).

davem2001

I'm going under the assumption that the next gen Legacy/Outback will be a little bigger than today's, closer to Camry/Accord size, so the potential "range topper" sedan would be closer to an Avalon. Just IMO

nippononly

I'm going under the assumption that the brand new Legacy/Outback that were just revised for MY2005 won't see any more major changes like that until at least 2009 for the 2010 MY! :-P

So if they were to bring out a bigger sedan next year, it would have plenty of time to be king of its roost before Legacy got bigger again.

davem2001

Yeah, the next gen Legacy/Outback probably won't be out until 2010 or so....

ateixeira

andre: that's just it, the AWD adds weight and cost, so a slightly smaller AWD Subaru will cost about the same as competitors. Otherwise they'd have to cost about $1500 more or they'd lose money like crazy.

Also, Legacy is still the same in Japan and the US, while others make two seperate cars. Subaru is too small to build 2 mid-size cars, so that won't happen, i.e. it won't grow much bigger.

That's why the Legacy, Mazda6, and TSX (euro Accord) are all about the same size. Toss in Jetta and Fusion.

If Subaru builds a bigger sedan, very likely it would be US only.

-juice

davem2001

Good points, too.....seems likely that the Legacy will stay as a "tweener" size...so there is definitely room for an Accord/Camry/Altima sized car for the US at least.... Is the Tribeca a worldwide offering or USA only?

Also, in terms of smaller cars, I agree - especially as you get down to the Aveo, Rio, Accent size/price, but even at the Civic/Corolla size/price, the $1500 or so premium for AWD becomes a harder sell. If you can afford an extra $1500, you'd likely be buying a nicer car in the first place...

ateixeira

Could use the same Tribeca wheelbase and wider chassis. Even the same powertrain. Just add a bigger body around it.

-juice

davem2001

Yeah, I could see that - sort of how the Ford Freestyle and 500 are basically the same.

varmint

"More mainstream models? Subaru got their tails whipped when they tried to go head-to-head with Toyota and Honda back in the '80s and '90s." - Bob

Ha! I got the same response from Nippon earlier. All I can say is... that was then, this is now.

Since the 1980's Honda, Toyota, and also VW have more or less moved out of the el-cheapo family transportation business. Their cars are now costlier than the average car in the class (though typically worth it). Nissan, Mazda, and others are moving in this direction, as well. The domestics more of less gave up on the car market (focused on trucks). Until recently, they've been selling nothing but junk for the buyer who wants inexpensive transportation.

The players left to exploit the opening are Hyundai, Kia, Mitsubishi, and Suzuki. Subaru is in much better shape here than either Mitsu or Suzuki. That means Hyundai/Kia represents the only serious players standing in the way. Look at how well Hyundai has been doing with this approach.

Correct me if I'm wrong, but last I heard, Subaru's upscale models were not selling well. And the ones they are selling have generous ($3-4K) discounts. That approach shows no signs of taking root.

That's why I say Subaru needs to get in on the ground level with an Elantra-like offering. A decent car with a low price tag. It will give them exposure to younger buyers and a larger audience. I think once buyers give a Subaru a chance, they'll come back for more. For what they are, Subaru's products are very good. All they need to do is get more people behind the wheel. Niche products that appeal to small numbers will not get that job done.

davem2001

I would stick with synthetic, especially if you're intending to keep the car as long as possible.... if you're leasing or planning to trade it in 4 years, why bother?

atlgaxt

I think one niche might be a small car with wild styling (think Mini). I think higher gas prices are a permanent reality, and subcompacts will start coming back in fashion. People want a small car, but they don't want to look poor.

I also think a real off roader would be good for the brand image, keeping Subaru in touch with their outdoorsy roots. Not a Jeep Wrangler, mind you. But an SUV, built with a durable platform (perhaps a modified Tribeca platform), increased ground clearance and better approach and departure angles and a low range but still using a unibody and 4 wheel independent suspension. All the capabilities of an SUV without the drawbacks. They can then use this platform to build a proper Ridgeline competitor.

A slightly modified "Outback" version of the existing Tribeca is a no brainer also.

rsholland

Oh, I agree. Subaru needs a good entry-level car. What I don't agree is that it should be an Elantra-like car. Whatever they come up with it should be uniquely Subaru. Otherwise, why bother?

I'm sure you know Subaru sells some micro cars in Japan, the latest being the R1 and R2 models, which debuted last year. They're tiny, and only have a 660cc engine. However, they are sold in both FWD and AWD.

They also sell in Europe a 1300cc and 1500cc Justy, again in FWD and AWD. The problem with the Justy is that it's essentially a re-badged Suzuki Swift; not exactly a great car. What Subaru needs is an all-new (and GREAT!) Justy replacement. That they could sell over here as their entry car.

So, it's not that Subaru doesn't have entry-level cars; they just don't sell them over here, at least not yet. At some point I do expect to see Subaru sell a car here that is positioned below the Impreza. I just don't know when, or what it will be. Again, I don't see it as an Elantra type of car, but more of a sporty Mini Cooper type of car.

Bob

varmint

Personal-Use Pickup I think Subaru could do a good version of the Ridgeline or SportTrak. But I don't think it would solve their problems. How many do you think they could sell? 20K? 30K? Now they're offering 5 models (or 6 depending on how you count them) to sell a total of 230K units?

Off-roader - Another niche? No one will ever take Subaru seriously. The secret to building a good off-roader is make it primitive and cheap. Build something that an owner can modify and fix with a hammer. It can't have complicated systems or lots of electronics.

I believe Subaru *could* do this. But there's nothing in their portfolio which suggests they would be good at it. Now... before you point out Subaru's expertise with AWD, just go read any 4x4 forum and see what they have to say about AWD. I'm not saying they're right. But it doesn't really matter, does it? Perception is probably more important than reality on these issues. Subaru isn't going to change the minds of Bubba and Skeeter.

Roadster - :confuse: Not just another low volume niche car, but one that would likely require a completely different platform than anything they currently offer. (A Jeeparu would have this same problem.) Roadster live and die on three things: performance, styling, and snob appeal. Subaru might be able to score points on performance.

Large Sedan - This one has potential. How about a Subaru limo? Based on the Tribeca platform with a lower starting price tag, such a vehicle might be good for 40K units. Not great, but not bad, either. Large sedans are not a big market, but it's not small enough to be a niche either. Plus it gives some place for current Subie owners to go when they outgrow the Legacy.

Minivan - Another one with potential. Again, using the Tribeca platform. I like this even more than the large sedan. Minivan owners aren't quite as sensitive about engine performance as SUV buyers, so the (relative) lack of torque from the 3.0L shouldn't be a big issue. It probably wouldn't earn them more than 40-50K units, but it would significantly raise the visibility of the brand.

varmint

"Subaru needs a good entry-level car. What I don't agree is that it should be an Elantra-like car. Whatever they come up with it should be uniquely Subaru. Otherwise, why bother?"

Because they need cash.

Did VW succeed with the Passat by doing something completely different than the Accord/Camry? Nissan do anything different with the Altima? Did Honda win over buyers with the 1999 Odyssey by doing something different? Nope.

In most every case, models which become competitive in the mainstream do it by copying the competition and adding one or two things that trump the others. The Passat added style. The Altima added power. The Ody added the magic seat.

(BTW, the magic seat was available in the original (small) Odyssey. It wasn't until Honda caved in and made an "American-style" van with that seat that people took notice.)

If you do something different, like Honda did with the Ridgeline, you'll create a niche. The style of vehicle may start to erode away at the market and gradually become a volume seller. (You an I have talked about that in other threads.) I don't think Subaru can afford to wait that long. They have years, but they don't have complete model cycles.

Essentially, Subaru needs to take off the nose ring, put on a tie, and get a real job. :shades:

rsholland

It's no secret that Hummer is looking at small a Wrangler-like vehicle. There's no reason why Subaru couldn't supply the drivetrain. Remember Subaru sells AWD with dual-range trannys overseas. This vehicle could be sold both at Hummer and Subaru stores; the Hummer with an enclosed hard top, and the Subie as a folding soft top model. Partnering with Hummer would give it plenty of off-road "cred."

I don't expect it to attract a lot of "Bubbas," but like Honda, Nissan and Toyota, with their pickups, I expect it to target their current owners who may also have a Wrangler in their garage.

As to large sedan, I'm thinking of something in the 108 – 110" wheelbase range. The Tribeca has a 108.1" wb.

Bob

rsholland

Essentially, Subaru needs to take off the nose ring, put on a tie, and get a real job.

Do you really believe that? That is sooooo much BS... If they do, they've lost me...

Subaru will do just fine varmint. Just let them do what they do best. They don't want to be another Honda—and thank god for that!

Bob

nippononly

doesn't need to go down into the basement for its entry-level model either. But a real car with A/C and a CD player that stickers at $15K would be the ticket. If it doesn't have AWD, so be it. They need to grab buyers! How are they ever going to expand their dealer network (another desperately needed move IMO) with such a trickle of sales?

Heck, they could do a FWD Impreza with A/C and a CD for $15K now, probably. Impreza is nicely loaded for the base price, now that the TS is gone. Maybe more loaded than it needs to be for an entry-level compact. They just have to pick a better mix of things to "strip away" for the base model. The TS had smaller rims - why is that necessary? Keep them the same size as the RS, make them steel with covers. The base model doesn't need cruise. Maybe power mirrors are optional. I think they could do it without bringing over a smaller model, but either way they need a less expensive model.

rsholland

Nip, Subaru's "signature" here and around the world is AWD. That's what they are known for. Nowhere outside of a few bottom-feeders in Japan do they sell FWD. AWD is a HUGE part of the heart and soul of what a Subaru is.

Start offering Subaru with FWD here, and you can kiss the brand goodby. GOODBY! It will turn into another Saab, a brand that once stood for something, but is now just a ghost of its former self, and doomed from what I can see.

No, Subaru must stick to their guns. I'm sure they have a better grasp on who they are and what they need to do than all the armchair quarterbacks here do.

Bob