Subaru of America has just had a record sales year and introduced its first SUV, the B9 Tribeca.
The SUV is helping drive Subaru dealer profitability and is bringing new and young customers to the brand.
To bolster its image, Subaru has begun a national ad campaign and is changing the way it funds regional dealer advertising. Fred Adcock, executive vice president of Subaru of America, talked with Staff Reporter Diana T. Kurylko at the NADA convention.
Subaru had record sales in 2005. Can you top that in 2006, and what will be the driving force?
We plan for 211,000 cars, up from 196,000 in 2005. The two principal drivers will be a full year for the B9 Tribeca SUV and growth of Impreza sales.
Last year, we sold 15,000 Tribecas, and in 2006 we are forecasting sales of 28,000.
The other growth will be in Impreza, and we are looking for about 38,000 cars, up from 34,000.
The Impreza is doing extremely well because we repositioned it last year. Legacy and Forester sales will be about the same as in 2005.
How profitable are dealers now with new vehicles such as the B9 Tribeca?
The Tribeca is the most profitable model dealers have in their lineup.
Dealer profitability is at the top of our minds. A healthy dealer organization is what you need to be successful.
We are working very closely with our national dealer advisory board to look at ways that we together can improve profitability.
Any specific new programs to achieve this?
We set up the Subaru advertising fund. Our independent distributors are not participating at this time.
We have put more money into Tier 3 (local) advertising - $500 per car is available in co-op support for the dealers.
When did this start? Are you diverting money from national advertising?
It started in February. We aren't taking anything away.
What other measures are you taking?
We changed our advertising focus. We are trying to be more effective in delivering what distinguishes Subaru from the other manufacturers. We are going to leverage our individual models with superiority claims - whether they be safety, performance, reliability or durability - and deliver it with the consistent envelope of, "That's what makes a Subaru a Subaru."
You may e-mail Diana T. Kurylko at [email protected]