Subaru Bubble Burst?....Problems Looming for Subaru?

[hmmrdwn]

Anyone out there see the Subaru bubble bursting? They've alienated quite a few loyal customers through oil consumption problems, boring cvt's, raising prices, greedy dealers/service writers and bland styling (The Crosstrek looks like a outdated Dodge Caliber). Compound those things with a bunch of first time Subaru owners who don't understand "inexpensive and built to stay that way" product development. First time owners will miss the refinement and quality of other brands. Put on top of that....every other manufacturer is shooting at Subaru's piece of the pie.

 

Don't take this wrong, Subaru is great and has a fantastic niche, I just see the sales bubble bursting. There's a saying in business..."The good times bring on the bad times and the bad times bring on the good times".

 

http://www.cheatsheet.com/automobiles/is-there-a-downside-to-subarus-u-s-sales-explosion.html/?a=viewall

[dgoodhue]

It is unrealistic for Subaru continue 20% year over year growth rate. Eventually it will subside. Could the bubble bust? perhaps. The sales could also grow until it comes to natural equilibrium and go up and down with auto industry. It could do something in between or something completely different. Here is my 0.02

 

 

Currently Subaru has more demand than production. So even if they demand was reduced by a little, the sales number probably would not suffer. I read that healthy amount of time for car to stay on dealer lots is 60-90 day. Most of Subaru's models are on the lot less than 30 days. One members on NASIOC who works for dealer mention they at one point and time in June where they had only 5 unsold cars on the lot. By not have cars in dealer inventory, they are losing sales.

 

 

Subaru has the industry's lowest incentives. This mean at this point and time they need less incentives to sell their car than any dealer despite the high growth. This also mean the high growth is not being propped up by incentives. This mean that it is lees likely that Subaru's for sales to swing the other negatives. The more aggressive sales is in discounting, the more likely they will see the negative downward swing. If Subaru sales start to falter, they can add incentives to boost sales.

 

 

The oil burning issue. From the dealer reports its seem like its only about 1% FB25 production problem, it is probably worse than that because some owners either got of their car already or haven't complained to the dealer. It seems like the new cars have resolved the issue. Subaru has been fixing engines and are taken caring of the worst offenders. Any misstep like this will lose a few potential future owners. I don't think it will doom the brand. Other manufactures have had burning oil issue low tension oil rings and it didn't sink them, some of them never even addressed the issue.

 

 

I agree that the new influx owners are less likely to brand loyal than the existing base of loyal owners. If they made the jump to a new brand once, it could happen again. I think most automatic transmission buyers are not going to turned off by a CVT. The manual transmission diehards (myself included in this group), don't have much choice since the entire industry is going this way. I don't know about other MT owners, but if push comes to shove, I can deal with an automatic transmission if it is behind an exciting to drive engine. Bland Styling, Subaru hasn't carved it niche in the market because of styling. The Legacy wagon? In the sub $35K category, the auto industry has no awd wagon without the additional ground clearance. If you can deal without AWD, the Volkswagen Sportwagen isn't flying out of the dealers either. Their is little demand at this point for a true wagon in the non luxury market. Ad for the Legacy GT, Outback XT, and MT Forester XT owners that were abandoned, Subaru has pushed them toward WRX sales. I personally think that performance market share is less brand loyal and it also isn't a big market share. What else are you going to buy without spending lot of money on a luxury alternative?

 

 

One issue that I do see coming up for Subaru. Is how much growth can they really attain? Subaru does really well in its key markets. Northwest, Colorado, Northeast and other parts of the snow belt. Subaru sales numbers in some markets are comparable to the other Japanese giants like Toyota and Honda. What if they are reaching saturation point in the key 'Subaru country' markets? Subaru with their current focus on AWD is never going to achieve Toyota sales production. I question how many sales Subaru can attain in the rest of the country. If I lived in the south I likely would own something else other than a Subaru. I see in the areas where AWD is more of luxury, that those sales with come and go with ebbs and flows of market popularity.

 

 

I personally in 2-3 year I think Subaru will continue to grow as production capacity is increased. I would not be surprise to see smaller year over sales growth though. At the very worst I would expect to see even sales. Beyond that I would not even make a prediction, who knows if a new generation of model completely missed the mark, their is a market shift, or if the economy falters, etc.

[FLlegacy]

Personally I don't see much of what you are talking about, those who have been around the brand a while know all to well that subaru has always had its quirk issues and styling was never a strong sales point. Personally, the brand is doing everything it has always done in a more attractive package with safety as the main selling point. That is the reason we keep coming back. I don't care where you live awd is a very nice feature when the weather turns nasty, and with near or above record rainfall around here lately I wouldn't do without it.

 

I believe subarus goal is around 1 million car sales world wide for growth and that is where they were going to cap out. I don't see them building more capacity or trying to compete with any other auto makers, they are a niche brand and they aren't trying to be anything else.

[MJ in PA]

Would I buy another Subaru? If it were 2007 again, sure, even knowing I'd have to drop a couple grand replacing prematurely worn head gaskets and wheel bearings. Oh, and paintless dent repair after a minor hail storm thanks to Subaru's ultra-thin easily dented sheetmetal. Today, no way. Fewer variants, worse looking cars, CVT only....clearly not the same company that delivered the 4th gen Legacy.

 

I'd almost certainly get a Ford Fusion today.

[Silinc3r]

I agree on some things. 2005 was a great year for Subaru, the STi, Legacy GT, Forester XT.

I do like the Crosstrek though. Very cool. Also the BRZ is something different and as you can see the young guys are buying them to build.

Subaru did mess up by getting rid of the GT in opinion. There is a reason why I prefer the GT over the WRX and STi.

And the southeast is doing very well because there are a lot of military and they have the money and credit unions to afford them.

[hmmrdwn]

I think Subaru is going to continue to grow, just not the same pace. Between rushed production, lack of testing and lower quality components, new Subaru owners will be scared away. Trendy cash cow now and boring tomorrow. Will reach it's saturation point.

[CAT793]

I find Subaru compared to Market often get criticised. But driven and owned in isolation are very much loved by loyal owners.

 

A 3.6R with out Direct Injection (heavy on fuel) and with a CVT (far from perfect) is never going to be a media darling. But if that's the only car you drive I am way confident you will love it.

[Silinc3r]

I wish I could sit down with them and have a talk, they should almost split up like Scion and Toyota.

One side would have all the boring cars, Outback, Forester, Legacy non turbo stuff

The other side would have the turbo goodies and then they would bring back the SVX and we would all be happy!

[icen]

coming to Subaru from Honda. Think i'm going to stay with Subaru for my next car.

Subaru is so much more logically designed. everything is intuitive and convenient. Love it !!

[GTEASER]

I bought my first Subaru, a GT, new in 2012 because it met my needs and wants. Nothing else on the market south of $40k did. I came from Toyota and Honda vehicles, and Acura was a possibility, but not high enough performance and FWD. The Subaru is quirky, and unique and that's what I like, being a little different. It's been 3 years now and the wife's BMW 328 went away in favor of a BRZ 6MT a few weeks ago. My wife loves that car so much more than the Bimmer, which she did love quite a bit. A year ago we bought her daughter's first car, a 2003 Forester and 9 months ago I bought a 1992 Legacy SS as a daily commuter which now has 170k miles on it and I wouldn't be afraid to drive it anywhere. We are now a completely Subaru family and when my son starts driving in 4 years, he wants a 2006 Impreza RS wagon.

[FLlegacy]

I don't see subaru pushing growth for the sake of growth. They have a plan and are executing it perfectly and sales prove it. And with all that they probably have the smallest advertising budget of all automakers in the USA and continue to grow. There is a lot more than just their cars to consider to global initiatives, environmental stewardship, and loyalty to their community programs.

 

If you are just buying a car then any car will do. But if you are buying into a company then what they do besides building cars matters too. Subaru is catching up in styling while others are trying to catch up to subaru in safety. Which one is more important?

 

Sent from my SAMSUNG-SGH-I337 using Tapatalk

[hmmrdwn]

I bought my first Subaru, a GT, new in 2012 because it met my needs and wants. Nothing else on the market south of $40k did. I came from Toyota and Honda vehicles, and Acura was a possibility, but not high enough performance and FWD. The Subaru is quirky, and unique and that's what I like, being a little different. It's been 3 years now and the wife's BMW 328 went away in favor of a BRZ 6MT a few weeks ago. My wife loves that car so much more than the Bimmer, which she did love quite a bit. A year ago we bought her daughter's first car, a 2003 Forester and 9 months ago I bought a 1992 Legacy SS as a daily commuter which now has 170k miles on it and I wouldn't be afraid to drive it anywhere. We are now a completely Subaru family and when my son starts driving in 4 years, he wants a 2006 Impreza RS wagon.

You were one of the smart ones that bought an LGT. Subaru, in it's marketing wisdom killed that model. The brz is another model that will disappear. You just made my point...

[hmmrdwn]

coming to Subaru from Honda. Think i'm going to stay with Subaru for my next car.

Subaru is so much more logically designed. everything is intuitive and convenient. Love it !!

I just don't see Subarus as intuitive, from the wiper stalk to parking brake and switch cluster. They just seem industrial and unrefined.

[Silinc3r]

We are talking about a company that really is a jack of all trades and on a "budget". I think we have to remember that. Subarus are AWD, disc brakes, have boxer motors designed for a purpose, have stuck with turbos since the 80s, have motorsports background and again all on a "budget". To me Subaru is intuitive in that sense. Subaru is only going to get better, I just hope they don't lose sight of who they are. Again, if they want to make a luxury sister company than by all means.

Is a BMW nicer, probably but even at its base model, it is only RWD, non turbo, most folks can't work on them and they're not on the cheap side.

[dgoodhue]

I bought my first Subaru, a GT, new in 2012 because it met my needs and wants. Nothing else on the market south of $40k did. I came from Toyota and Honda vehicles, and Acura was a possibility, but not high enough performance and FWD. The Subaru is quirky, and unique and that's what I like, being a little different. It's been 3 years now and the wife's BMW 328 went away in favor of a BRZ 6MT a few weeks ago. My wife loves that car so much more than the Bimmer, which she did love quite a bit. A year ago we bought her daughter's first car, a 2003 Forester and 9 months ago I bought a 1992 Legacy SS as a daily commuter which now has 170k miles on it and I wouldn't be afraid to drive it anywhere. We are now a completely Subaru family and when my son starts driving in 4 years, he wants a 2006 Impreza RS wagon.

 

Wow, you went all in with the Subaru family. I tried to steer my wife towards a Subaru when she bought a new car last fall. Partially that was because her first choice in paper was a Prius V and I end up driving her car on all long trips. She fortunately hated the way it fit and drove. She ended up with a TDI Sportwagen but I am little worried about the long term reliability of a VW since we truly to keep our cars long term. She already has had one electrical problem repaired under warranty. I still sort of wished she had bought an Outback or Forester, not because I wanted a Subaru family of cars but because I think they are more reliable and cheaper to repair than a VW.

[dgoodhue]

I just don't see Subarus as intuitive, from the wiper stalk to parking brake and switch cluster. They just seem industrial and unrefined.

 

Some of that probably depends on what kind of cars you came from. I didn't have any issue with adapting to Subaru's layout. My truck has a mechanical e-brake in the same place. The lights/wipers are similar to my past toyotas. I struggled a little with my wife's VW layout.

[TwoTone]

Wow, you went all in with the Subaru family. I tried to steer my wife towards a Subaru when she bought a new car last fall. Partially that was because her first choice in paper was a Prius V and I end up driving her car on all long trips. She fortunately hated the way it fit and drove. She ended up with a TDI Sportwagen but I am little worried about the long term reliability of a VW since we truly to keep our cars long term. She already has had one electrical problem repaired under warranty. I still sort of wished she had bought an Outback or Forester, not because I wanted a Subaru family of cars but because I think they are more reliable and cheaper to repair than a VW.

 

TDIclub is a good place for VW TDI owners.

 

I haven't been following it lately since I gave up on TDIs with the new CR engine and costly failures, so I'd recommend a read throw it and for now, save every fill up receipt in case you need it later.

[dgoodhue]

TDIclub is a good place for VW TDI owners.

 

I haven't been following it lately since I gave up on TDIs with the new CR engine and costly failures, so I'd recommend a read throw it and for now, save every fill up receipt in case you need it later.

 

I had found forum already. I joined about 5 months before she actually bought her car to research the known issues. I have tracked our fuel purchases since new to track the possibility of tainted diesel; we pretty much buy our fuel at one station and if she has to fill up elsewhere she is under strict order to go a busy top tier gas station. I steered her away buying the sunroof, because the sportwagen forum section is littered with jammed sunroofs.

[TwoTone]

I had found forum already. I joined about 5 months before she actually bought her car to research the known issues. I have tracked our fuel purchases since new to track the possibility of tainted diesel; we pretty much buy our fuel at one station and if she has to fill up elsewhere she is under strict order to go a busy top tier gas station. I steered her away buying the sunroof, because the sportwagen forum section is littered with jammed sunroofs.

 

Just wanted you to be aware of the HPFP failures and VW's propensity to blame anything other then themselves and try to deny warranty.

 

We had a 2005.5 Jetta TDI and were looking at a Sportswagon when the issue first came up. Originally VW was charging people close to 9k out of pocket, that's what steered us back to take a second look at Subaru. We originally shopped the Legacy against the Jetta.

[hmmrdwn]

Some of that probably depends on what kind of cars you came from. I didn't have any issue with adapting to Subaru's layout. My truck has a mechanical e-brake in the same place. The lights/wipers are similar to my past toyotas. I struggled a little with my wife's VW layout.

True. I came from a couple euro sedans. They were more ergodynamic and intuitive.

[YeuEmMaiMai]

Subaru's problems are insignificant compared to other automakers like GM, Chrysler, Honda (Automatics since 1998) and Toyota....

 

Do you ever wonder why Subaru hold their value better than German cars? Once German cars are out of warranty, their value drops faster than Greece's GDP did...

 

here is a prime example of Ford Taurus SHO 40K new, after 2 years 26K with 30K on the odo

 

right now you can get one for 36K after 6K incentives, what do you think will happen to the price of the used ones? Forced down.

[hmmrdwn]

Subaru's problems are insignificant compared to other automakers like GM, Chrysler, Honda (Automatics since 1998) and Toyota....

 

Do you ever wonder why Subaru hold their value better than German cars? Once German cars are out of warranty, their value drops faster than Greece's GDP did...

 

here is a prime example of Ford Taurus SHO 40K new, after 2 years 26K with 30K on the odo

 

right now you can get one for 36K after 6K incentives, what do you think will happen to the price of the used ones? Forced down.

 

That really has nothing to do with subarus bubble bursting. Subarus bubble will burst because of lack of demand. European cars drop in valueAND still have demand. American auto makers use a different marketing scheme. They jack msrp up and let dealers negotiate big profit margins. Subaru works on smaller margins. Subarus sales will drop and they will need to reorganize in five to ten years. Other manufacturers are cutting into the Subaru niche. Other companies will make better cuv, SUVs. subarus are cheap because of materials, not economies of scale. Consumers won't like lesser quality coming from luxury brands.

[The B4]

That really has nothing to do with subarus bubble bursting. Subarus bubble will burst because of lack of demand. European cars drop in valueAND still have demand. American auto makers use a different marketing scheme. They jack msrp up and let dealers negotiate big profit margins. Subaru works on smaller margins. Subarus sales will drop and they will need to reorganize in five to ten years. Other manufacturers are cutting into the Subaru niche. Other companies will make better cuv, SUVs. subarus are cheap because of materials, not economies of scale. Consumers won't like lesser quality coming from luxury brands.

 

You're so silly. It's like you are trying to use the force to will Subaru's demise upon them. Subaru went from #20 something to #9 in volume... and they did it with one of the smallest marketing budgets and the least amount of incentive spending of any brand. They are at record market share and didn't do it by hiding behind fleet sales. Other manufacturers are offering AWD, but no one is doing it with the same value and safety. Honda and Toyota took direct aim at the Outback with the Venza and Crosstour. Neither put a dent in Outback sales and the Outback beat both of them into submission. Both have been discontinued.

 

Subaru's cap will be its production. Things won't always be perfect for any brand, but I don't see Subaru taking a dive anytime soon.

 

(note on American automakers... they aren't negotiating big profit because of high MSRPs. They have some of the lowest profit per vehicle as they routinely sell below cost plus they spend a fortune on incentives on top of that. Trucks keep them afloat)

[hmmrdwn]

You're so silly. It's like you are trying to use the force to will Subaru's demise upon them. Subaru went from #20 something to #9 in volume... and they did it with one of the smallest marketing budgets and the least amount of incentive spending of any brand. They are at record market share and didn't do it by hiding behind fleet sales. Other manufacturers are offering AWD, but no one is doing it with the same value and safety. Honda and Toyota took direct aim at the Outback with the Venza and Crosstour. Neither put a dent in Outback sales and the Outback beat both of them into submission. Both have been discontinued.

 

Subaru's cap will be its production. Things won't always be perfect for any brand, but I don't see Subaru taking a dive anytime soon.

 

(note on American automakers... they aren't negotiating big profit because of high MSRPs. They have some of the lowest profit per vehicle as they routinely sell below cost plus they spend a fortune on incentives on top of that. Trucks keep them afloat)

 

Who's trying to "force to will Subaru's demise"? I'm just asking if and when will Subaru's bubble burst.

[YeuEmMaiMai]

That really has nothing to do with subarus bubble bursting. Subarus bubble will burst because of lack of demand. European cars drop in valueAND still have demand. American auto makers use a different marketing scheme. They jack msrp up and let dealers negotiate big profit margins. Subaru works on smaller margins. Subarus sales will drop and they will need to reorganize in five to ten years. Other manufacturers are cutting into the Subaru niche. Other companies will make better cuv, SUVs. subarus are cheap because of materials, not economies of scale. Consumers won't like lesser quality coming from luxury brands.

 

I just illustrated why their bubble isn't going to burst and you unfortunately missed it.