Subaru and the Bochs: Always in concert

This story will be part of a special section marking the 50^th anniversary of Subaru in America, to be published in the Feb. 12 issue of Automotive News.

With his disheveled long hair, gray beard, rock band T-shirts and sneakers, Ernie Boch Jr. looks more like an aging rock star than the billionaire businessman whose company sold about 10 percent of all Subarus retailed in the U.S. last year.

Boch, who turns 60 this week, does in fact play in a rock band. But he is also CEO of Boch Enterprises, an independent distributor for 64 Subaru dealerships in the six New England states — Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. Last year, Boch Enterprises sold close to 65,000 vehicles of the brand's U.S. total of 647,956.

The hypercompetitive Boch says he has visited Subaru distributors in several foreign markets to "take ideas back as inspiration" and then tries to outsell them.

He has benefited handsomely from the brand's expanding popularity. He is the 30th richest person in Massachusetts with a net worth of $1.1 billion, according to AffluenceIQ in Winchester, Mass.

Indeed, Subaru's long run of success has been very good to him. Boch lives large in Norwood, Mass., having renovated an aging mansion, doubling the size to 16,000 square feet and buying adjoining properties so that his home sits on six acres.

But it's not just a matter of being with the right brand at the right time. The distributorship has made a huge contribution to Subaru's great leap forward during the past decade — and long before that.

Boch took over the family business after the death of his father, Ernie Boch Sr., in 2003. His grandfather, Andy Boch, began things in 1938, opening a repair shop. The next year, Andy Boch opened his first store, Boch Rambler. He added a Nash dealership in 1945, and Ernie Sr. joined the business three years later.

Ernie Sr. took over in the 1960s and at one point a Massachusetts banker named Dominic Sansone gave him a $10,000 loan to keep the business going. Boch Sr. acquired additional franchises, and in 1970, Sansone asked him to consult on New England's ailing Subaru distributorship, which Boch Jr. says "wasn't exploiting the opportunities."

The distributorship had been awarded to Massachusetts businessman Harper Clifford in 1969 by Harvey Lamm, one of the founders of Subaru of America.

More than a dozen franchises had been awarded — mostly to Saab dealers.

"Clifford had the distributorship, but he was going out of business," Boch Jr. says.

Clifford took Boch Sr. on a tour of his dealerships, where Subarus were put in the back of the stores and were ignored by the salespeople. Boch Jr. says his father's idea was to have exclusive, stand-alone stores.

Boch Sr. bought out Clifford in 1971 and turned the business around. For the next few years, the distributorship sold about 10,000 vehicles annually.

"He had a knack of knowing what would be popular," Boch Jr. says of his father.

He frequently made suggestions to Subaru of America's parent, then known as Fuji Heavy Industries. He pushed for the shift to exclusively all-wheel-drive vehicles and "suggested the raised roof on the Outback," Boch Jr. says.

"In the late '80s, we stopped bringing in front-wheel drive and took exclusively awd," he says.

Boch Sr. also lobbied Japan to make a Legacy sedan, a car that was similar to today's crossovers. He told Automotive News in 1997 that most U.S. officials were "very, very skeptical," because they feared the car would compete with the Outback wagon.

Fuji Heavy sent Boch Sr. a prototype Legacy. As an experiment, he agreed to take 300 of them for the 1997 model year — and sold them all.

Over the past half-century, most independent new-vehicle distributors in the U.S. have been bought out by the manufacturer. But Subaru never sought to buy out the Bochs.

"I think that the private entrepreneur [as distributor] is an asset in today's market," Boch says. "Communication with the dealers is of the utmost importance and we can turn on a dime. The buck stops with me and processes are adopted, changed and controlled to what we deem best. We are a nimble corporation."

Boch's isn't Subaru's only private distributor in the United States. Subaru Distributors Corp., in upstate New York, distributes vehicles, parts and accessories to dealerships in New York and New Jersey.

Ernie Boch Jr. began working for his father in the early 1980s and in 1986 began traveling with him to Fuji Heavy headquarters in Japan yearly — usually uninvited — to talk to company executives.

At the time, Boch Jr. regarded the vehicles as quirky, but the brand was "invigorated" with the debut of the Forester compact crossover in the late 1990s and later by the Outback midsize crossover, he says.

Boch says his "heroes" from that era were a pair of Fuji Heavy CEOs, Isamu Kawai and Ikuo Mori. Kawai, CEO from 1990 to 1996, approved building the Outback in the early 1990s and made the move to all-awd vehicles.

"Mr. Kawai saved Subaru," says Boch.

The only variation from the all-awd policy has been the low-volume rear-wheel-drive BRZ coupe that went on sale in the U.S. in 2012 and was designed in partnership with Toyota. Boch says he loudly opposed the BRZ because it wasn't awd.

"I was against it and I was proven wrong," Boch says. "I have told them that."

Mori, CEO from 2006 to 2011, made the decision to design and equip Subaru vehicles primarily for the U.S.

Tom Doll, president of Subaru of America, is another executive Boch admires.

"Doll made Subaru cool," he says. "It was always a great engineered car. But he helped to get the coolness and safety across — he massaged the image."

Doll also persuaded Boch nearly a decade ago to give up some of his new-vehicle allocation so Subaru could grow in the Sun Belt.

"Subaru knew — and I credit Tom Doll — if they were to survive they had to turn the Sun Belt on," Boch says. "We sacrificed a bit. I agreed and the rest of the country woke up to Subaru."

Boch's sales as a distributor have fallen as a percentage of Subaru's total in the U.S., but he says, "I am selling more cars than I ever have."

Boch says Doll also improved communication with dealers, giving out his cellphone number several years ago at an NADA make meeting and telling his retailers to call anytime. Boch says he talks to Doll frequently: "It is a direct line, almost like a red phone, and we throw around our ideas."

Boch concedes that not every Subaru was a hit.

The Brat, a small pickup sold in the U.S. from 1978 to 1987, didn't do well but was highly popular with owners, he says.

The wedgy XT coupe that went on sale in 1985 wasn't popular either but "was a fashion statement," he says.

The Tribeca crossover that debuted in 2005 was derided by dealers and reviewers. For that one, Boch says, "Subaru did not get the input from the dealer council that they did with the Ascent," referring to the large crossover that goes on sale this year.

"We have been going to Japan for three years giving our opinion on the Ascent and they have been sensitive and taken some of the ideas."

Dealers argued early on that the Ascent had to be considerably bigger than Japan had planned, he says.

Indeed, Boch has operated dealerships for other Japanese brands, but he says none ever permitted dealers so much access as Subaru.

Meanwhile, he says it's OK that Subaru isn't a full-range manufacturer.

"Subaru is still a boutique-y type vehicle," Boch says. "It is a great alternative vehicle — Subaru is better because of the engineering, styling and support the factory gives to the dealers. I think that Subaru is still just blossoming in the United States."