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

rsholland

Subaru will have a "world debut" at the Chicago car show. My guess is either the Euro-beca or the '07 Legacy, but those are just guesses.

Bob

nippononly

microcar (R1e?) dead, or is there still a chance that will come to America? I want that or a microvan, not the next better Legacy or a Euro-beca.

They are really beating the Legacy line to death trying to come up with ways to find more buyers, even as they cancel the manual transmission in the GT wagon - what was the thinking there? :confuse:

How about something to supplement the line, not just more variations on the Legacy?

ateixeira

it's really no better than most small SUVs

Early report of real-world mileage have been promising. I think they went a little conservative on the EPA mileage estimates.

If Subaru could get it to 20/25 or better they'd be OK, and I think they can.

-juice

ateixeira

Most Outbacks are wagons, but most Legacys are sedans. They offer an OB XT with the manual, but didn't see enough volume in the Leg GT wagon to offer it.

Even here on Edmunds, most of the GT wagon owners opted for the automatic, and we're the enthusiasts.

-juice

robr2

Early report of real-world mileage have been promising. I think they went a little conservative on the EPA mileage estimates.

Juice - no such thing as being conservative on EPA mileage estimates. They are what they are based on scientific testing. Well, as scientific as the EPA gets.

ateixeira

They do the tests in-house, though the EPA is supposed to be able to replicate them.

-juice

robr2

They do the tests in-house, though the EPA is supposed to be able to replicate them.

That is sometimes the case and I think the EPA would frown upon a company reporting false results - even if they were more conservative.

kyfdx

"we folks in marketing typically try to sell what people are willing to buy."

I thought marketing was stuck selling whatever management made? Anybody can market what people are willing to buy.. A real marketer can sell Frigidaires to Eskimos...

subearu

I still can't see why they'd debut something for a non-US market when it's a US market show...

-Brian

varmint

Actually, I think Subaru could do better. Something like 21-26 should be within their reach.

Even so... Compare that with an Outback which is a 5 seater with an epa rating of 22-28 mpg. Even a full-size 7 seater minivan like the Odyssey will get 19-25 mpg (or 20-28 w/VCM). And now the RAV4 offers a 3rd row. Granted these vehicles would be more expensive than something like the vanlet and would be a compromise in many ways, but they also have a lot going for them in other areas.

I think if Mazda saddled the 5 with AWD, and it's mpg penalty, we wouldn't be seeing such strong sales. And that's exactly what Subaru would do if they built something like it.

ateixeira

Mileage is more important to me and you than it is to most folks. A lot of people don't care all that much.

VCM is nifty but isn't that for Ody EX-L and above? We're talking a price segment $10 grand or so higher at least.

The Mazda5 starts at around $18k, I'd hope Subaru could add AWD and start at around $20.

Basically I'd like to see a value-priced people mover with AWD. The Mazda5 is very, very close to what I want. It's actually fun to drive, too.

-juice

erics6

Not sure I agree with you on the mileage. I think a lot more people are starting to care.

Frankly, I find the 5's mileage a little dissappointing. I think your going to see a lot more Variable Cylinder Management in the near future, in a lower price point. It certainly makes sense to me. You can offer a bigger engine that gets up and moves, but offers good highway MPG. I'd certainly prefer that to the Hybrid technology.

The 5 doesn't seem to be selling very well around here. Haven't seen one one the road yet, and dealerships are already discounting way below invoice. They are fun to drive. I'd like Subaru to do one too... I'm just not sure there's a market. How about a 5 sized Subaru van with AWD, enlarged displacement 3.5 6 cyl., and VCM. Now that would be nice! Okay, and it has to stay in the $20k price point. :-)

varmint

I like the idea, too. And I think a Subaru version of such a vehicle would also be a hoot to drive. I just think the Mazda5 really isn't all that fuel efficient.

I mean, 22-27 mpg is what an AWD CR-V gets. A 2wd RAV4 will get net you 30mpg on the highway.

If Mazda added AWD to the 5, mileage would drop even further. I suspect Subaru could do better (their 2.5L engines generate more torque to handle the weight), but the limitations of AWD will bring that figure back down.

ateixeira

eric: all that for $20k? :surprise:

How much money would they lose on each unit sold?

RAV4 would also be on my short list right now. I want to see what the EPA ratings will be when they revise the test, though, and how it will compare to other models.

Mazda5 has relatively short gearing, I guess for good get-up-and-go. I drove one at the Zoom Zoom Live event and it was fun, tossable, more so than heavier vehicles like the ML430, just as an example. I guess I'm biased towards light cars.

-juice

ateixeira

Found this ironic - in a survey by Reuters, iPod owners mentioned Subaru 3rd most often among all brands. Pretty amazing considering how small Subaru is.

Any how, the irony is in that no Subarus have an aux jack for iPods, so we're stuck with FM modulation or a do-it-yourself fix. Pretty lame.

Only the Tribeca has an aux input, and even then only certain loaded up models.

-juice

oregonboy

Aux input is the wave of the future... the mnfgs just haven't caught on yet... they are too busy restlying altezza-tail lights :P

Five years from now it will be SOP in all but the most backward of offerings.

james

robr2

Found this ironic - in a survey by Reuters, iPod owners mentioned Subaru 3rd most often among all brands. Pretty amazing considering how small Subaru is.

IIRC, that same poll put VW in the top 2. I guess it points toward a younger demographic.

ateixeira

My dealer buddy said that it's way down on the list for most buyers. In fact, the fact that they fell behind and still offered cassette decks until recently may explain why iPods are popular. They could not play MP3s until recently as well, so owners with older radios probably bought iPods with cassette adaptors. :sick:

A different dealer told me they'll add one in the center console, so that iPods can draw power and connect directly without any cables in sight. :shades:

I say, hurry up!

Mazda went to CDs very early on, about a decade ago, and also was early with MP3 players.

-juice

jeffmc

A bit more on possible Camry production at SIA:

http://www.indystar.com/apps/pbcs.dll/article?AID=/20060131/BUSINESS/601310395

nippononly

get going already, so they can finally put the Baja out of its misery. :-P

PF_Flyer

Be sure to join the Eagle One team in a live chat event tonight to find out how nanotechnology is changing the future in car appearance products.

The chat gets underway at 9PM ET/6PM PT.

There's also going to be a special offer available only to those attending the chat, so don't miss this one.

Eagle One Team Chat

varmint

Even though it's still in the rumor stages, I see this as very positive news. 1,000 jobs would be 30% more than the current staffing and would go a long way to eliminating the losses SIA has reported in recent years.

ateixeira

Don't make me break out the sales book for the Outback sedan again.

But dealers will probably have enough Bajas in stock to still have them available for a year or so after production stops. Maybe 6 months.

-juice

PF_Flyer

I guess this will be the pre-Philly chat :P

PF Flyer
Host
News & Views, Wagons, & Hybrid Vehicles

The Subaru Crew Chat is on tonight. The chat room opens at 8:45PM ET Hope to see YOU there! Check out the schedule

nippononly

LOL! Next year we might still be seeing screamer ads: "$5000 off MSRP, all '05 Bajas in stock! PLUS, a free watch!"

ateixeira

HURRY WHILE SUPPLIES LAST!

WE ALSO HAVE THE INCREDIBLY RARE OUTBACK SEDAN!!!!!!!



-juice

jeffmc

Well, Subaru beat last January's numbers, but only by 44 vehicles.

Jan. '06 numbers from cars101.com:
total 12,384. Tribeca 1,421, Legacy 1,594, Outback 3,202, Impreza 2,550 up 17%, Forester 3,331, Baja 286.

For comparison, Jan. '05 numbers from SOA:
total 12,340. Legacy 1,630, Outback 4,024, Impreza 2,177, Forester 4,155, Baja 354.

Every model but Impreza is down (except Tribeca, which wasn't sold last Jan.), but most disturbing is that their bread-and-butter Outback and Forester models make up nearly all of that loss, with each down 20% over last year - and Forester has had a "freshening" since then, too.

Tribeca only sold at about half the pace of December; hopefully the upcoming '07 tweaks will be enough to encourage folks who avoided version 1.0. It's unfortunate there was as much negative press as there was about the vehicle's nose. It put the Tribeca name out there, which is good, but hopefully too many folks won't have it ingrained from reviewers that it's an ugly snout. (not my opinion, btw)

jeffmc

Combined, Outback and Forester lost 1,646 units over Jan '05, and even after adding Tribeca's sales in, there's still a net loss of 255. Add in Legacy and Baja's minor drop of 277 units combined and the brand would be down 532 units despite adding a flagship crossover to the lineup. Thank goodness Impreza had a good month.

Subaru needs some new products to liven up sales, I think! (Or a TT H6 to debut in Chicago in a couple days, to create a stir.)

This has been a warm winter so far. Maybe Subaru just needs a snowy February. :sick:

jeffmc

Planned sales volumes in Mexico would only amount to 2% of the SIA plant's current production, but every little bit helps.

http://www.indystar.com/apps/pbcs.dll/article?AID=/20060125/NEWS01/601250475

ateixeira

They had a great December, so maybe that pulled a few sales forward.

Forester was being cleared out last year, so prices were a lot lower, so that drop doesn't surprise me. I've been looking, and prices are about a grand higher than they were a year ago now.

It only proves how consumers have come to expect incentives. That plus the RAV4 is out and that's gonna put pressure on every SUV in the segment. Even the improved Grand Vitara's sales were up something like 496%, adding more pressure. Toss in the Tucson and Sportage.

I wonder how the CR-V sold in January? Was it affected as well?

The '08 update of the Forester will be critical. It's had the same wheelbase since 1998, meanwhile competitors keep growing.

IMO back in '98 Forester was the clear segment leader, buying it to me was a no-brainer. Among the asian compact SUVs it had the most horsepower, the most torque, and the most comprehensive safety equipment and standard content. Only the 4th item is still true today (content).

While it has received evolutionary updates, competitors like the RAV4 have received revolutionary updates.

Subaru cannot rest on its laurels. I honestly think the '08 Forester will be critical to their survival.

-juice

ateixeira

Just checked, Forester dropped 824 units, CR-V was down 835 units from last January, though in terms of actual % that's a smaller loss than the Forester suffered.

CR-V is closer to its redesign, though.

January basically stunk for Subaru. It was as bad as December was good.

-juice

prosa

It is unwise to project trends from just one month's results. I agree with a prior poster, that January's unusually warm weather in much of the United States depressed Subaru sales.

atlgaxt

IMHOP, the "freshening" of the Forester was not successful. While they did not do a Tribeca on it, I think the '06 is less attractive then the 03 - 05.

ateixeira

Good point, it is just one single month (after a great December), but I guess I'd been predicting the RAV4 would have an impact on the segment and perhaps we are beginning to see that.

-juice

nippononly

Of the Big 6, the only one that lost sales was apparently Nissan, so Subaru being down is not good. I wonder how February is going.

HOW long until that next Outback revamp?! ;-)

ateixeira

They really should have come out with this in the first place, I've been calling out for a blacked out grille for a while now, finally here it is:



That's a custom done by Bosal, but that grille should appear on the 07s. A chrome mesh grille and chrome wheels will be optional (thankfully) for the Bling-Bling crowd.

Anyone else think this looks 10 times better than the old chrome grille?

-juice

kyfdx

...but, as mentioned before... I think the biggest problem with the look is the headlights above the grill.. The same thing that makes the Cayenne not look so good..

ateixeira

Yeah, but Cayenne is the best-selling Porsche, so successful that Porsche was able to buy a share of VW!

-juice

robr2

Anyone else think this looks 10 times better than the old chrome grille?

Nope - I prefer the chrome. I think the black will look out of place on other colors.

nippononly

body color on cars that aren't black. In that case, I would prefer it to the chrome, yes. The Tribeca does look bug-eyed as kyfdx says. This whole grille needs a rework - make it a larger version of the Impreza's new grille - narrow, not huge, and with the headlights on the same plane as the grille.

erics6

Much better. Headlight position is still odd, but this should help sales a bit.

kyfdx

Cayenne is also the cheapest Porsche... I don't think the frequency of sales has anything to do with how good it looks.. The Touareg is much nicer looking, and is basically the same shape... I think the headlights/grill/front end is what makes the difference...

varmint

Ditto. The body-colored treatment would be a small improvement, but a whole new nose is in order. While it still isn't pretty, the job they did with the Impreza is much better.

rsholland

Not quite: Pixs of the new "Beca are now on the Net. There is still a chrome edge around the grille. Still, it looks better than the original.

Bob

ateixeira

Bob's right, the headlights are also not smoked.

Clearly Bosal's custom was intended for black paint, but I think it would have looked good in any dark color.

The cheapest Cayenne (the V6 model) didn't come out until long after the V8 and V8+turbo models had already boosted Porsche's sales substantially. And that V8 costs more than a Boxster.

-juice

kyfdx

2003 for the V-8 and Turbo.... V-6 came in 2004...

I don't think it is selling because of the good looks of the front end..

ateixeira

True but it hasn't held back sales, either.

-juice

kyfdx

You are correct there.... but, Porsche started from zero SUV sales... If you want a Porsche SUV, the Cayenne is your only choice.. They probably don't have any real competition, except for Land Rover..

But, if you want a Subaru SUV, you have many choices, all better looking than the Tribeca (though admittedly dated looking).. and, many, many more competitors from other makes... in the $30K-$40K range, the number of choices in SUVs is staggering.. Unattractiveness can be a killer in this segment, because there are so many other choices...

regards,
kyfdx

erics6

Beauty is in the eye of the beholder. There are competitors that are better looking then the Beca, some that are worse.

varmint

Then why is Subaru changing it?