DETROIT – Subaru of America Inc. says it expects sales this year to surpass the 200,000-unit mark after declining in 2007.
“When we were putting our business plan together last year, we were forecasting sales to be a little bit less in 2007 vs. 2006,” Tom Doll, executive vice president and chief operating officer, tells Ward’s in an interview here. “The reason for that was because 2007 was a transition year for us.”
Despite last year’s launch of a refreshed Tribeca cross/utility vehicle and all-new Impreza, Subaru sales declined 6.7% to 187,206 units from 200,703 in 2006, Ward’s data shows.
But now, with a full year of Tribeca and Impreza deliveries, as well as an all-new Forrester CUV debuting in the spring, Doll says 2008 volume should eclipse last year’s and total more than 200,000 units again.
“That’s our plan,” Doll says, noting later in the year the auto maker will be winding down sales of the current Legacy and Outback as it prepares to launch next-generation models.
Despite the Tribeca refresh, in which the original polarizing, Italian-inspired grille was exchanged for something a bit more innocuous, deliveries last year slipped 9.8% to 16,790 units.
“We’re going to try and find the appropriate level of sales in the market for the Tribeca,” Doll says, insisting Subaru will not “incentivize” the vehicle as it did in previous years to spur sales.
“What supported the (previous-generation Tribeca) was a lot of potential export sales that might have occurred,” Doll says. “We’re not having (that) anymore, so consequently the quality of the sales we’re enjoying now are better for our dealers because those cars will stay in (the domestic) market.”
Subaru’s modest goal for the Tribeca in 2008 is to “sell one more unit than we sold last year,” Doll jests. The auto maker previously said it aimed to sell 15,000 Tribecas this year.
Unlike the Tribeca, the Impreza compact car, which launched late last summer, saw sales climb 12.6% in 2007 to 46,332 units.
The Impreza still has a long way to go to topple the segment-leading Honda Civic and Toyota Corolla, but Doll is hopeful about its potential.
“We just came off our best Impreza month ever,” he says. “We sold over 5,000 (5,376 in December), so we set a record for us. It’s building momentum, and we think we’re going to be OK with it.”
The turbocharged performance Impreza WRX still lacks full availability, he says, and the model’s STi trim is “basically sold out.” The two vehicles accounted for about 20%-25% of total Impreza deliveries in the U.S. last year, a percentage that historically has been higher.
Subaru has made a point of trying to raise both the profile and sales of the naturally aspirated Impreza, and a company spokesman says this is starting to happen, although demographic data still is scant.
“It is attracting a new set of customers,” he says. “Younger, obviously, compared to the other products we sell.”
To Subaru’s surprise, the hatchback has been outselling the sedan, a situation the auto maker expected to be reversed, the spokesman says. However, the trend is in keeping with the recent revival of the hatchback in the U.S.
Doll says Subaru’s strategy of pricing the Impreza starting at $16,995 is paying off.
“It allows us to have a price point, or a lease payment, that draws people in,” he says. “Once you get them in, the dealers do a good job of moving them up into the next level of trims.”
Subaru has set a 230,000-unit U.S. sales goal by 2010. To do so, it is putting a fair amount of effort in trying to capture the attention of buyers who dismiss it as “a cold-weather brand” due to its widespread adoption of all-wheel-drive technology.
Last year, Subaru opened regional marketing offices in the Los Angeles and Dallas areas to devote more resources to the Sunbelt states. The auto maker also switched advertising agencies, as well as its marketing to a less-technical and deal-centric message, Doll says.
“I think we should be there today, when you look at the brand assets that we’ve got,” he says of the 230,000-sales mark, citing awards and achievements from the Insurance Institute for Highway Safety and Consumer Reports magazine. Only Subaru and Honda Motor Co. Ltd.’s product lineups are recommended across the board by the publication.
Without any new vehicles, including a subcompact, on the horizon, Subaru will be growing sales with its existing lineup.
“We could sell more than (50,000 Foresters and Tribecas annually),” the spokesman says. “The Honda CR-V is selling (about) 200,000. Forester is as good a product. It’s an awareness challenge.”
