View Full Version : REPORT: Subaru says it can't Justy-fy selling a subcompact in the U.S.

12-23-2009, 02:07 PM
Filed under: Budget (http://www.autoblog.com/category/economy/), Subaru (http://www.autoblog.com/category/subaru/)

http://www.blogcdn.com/www.autoblog.com/media/2009/12/subaru-justy.jpg (http://wardsauto.com/ar/subaru_not_subcompacts_091222/)

What do Toyota (http://autoblog.com/make/toyota), Nissan (http://autoblog.com/make/nissan) and Honda (http://autoblog.com/make/honda) all have in common? (Besides the fact that they are all Japanese automakers, that is?) They all re-entered the subcompact market in 2006 after abandoning it years ago. What's more, Mazda (http://autoblog.com/make/mazda) is planning to bring its subcompact Mazda2 to U.S. shores next year, Suzuki (http://autoblog.com/make/suzuki) has signaled its intent to enter the B-segment with its popular Swift hatchback (http://www.autoblog.com/2009/08/26/report-u-s-market-suzuki-swift-still-on-track-for-2011-next-g/), and the domestics are in the game with the Chevrolet Aveo (http://www.autoblog.com/model/Aveo) and forthcoming Ford Fiesta (http://www.autoblog.com/model/fiesta).

So, where does that leave Subaru (http://autoblog.com/make/subaru)? After all, the company has roots in small cars, starting with its first automobile, the downright minuscule 360, all the way up to the off-the-wall, four-wheel drive, three-cylinder Justy and its unconventional CVT.

Subaru spokesman Michael McHale tells Wards Auto, "The thing with the B-sector is you have to ask how you make money at the lower levels. You look at the pricing on the B segment - it's a tough segment to make money." Indeed it is - with base models of some competitors starting just under $10,000, profits are in very short supply.

For an automaker as small as Subaru, taking a risk on what is likely to be an unprofitable model generally isn't a smart idea. In other words, don't hold your breath for another subcompact Subaru any time soon.

[Source: Wards Auto (http://wardsauto.com/ar/subaru_not_subcompacts_091222/)]REPORT: Subaru says it can't Justy-fy selling a subcompact in the U.S. (http://www.autoblog.com/2009/12/23/report-subaru-says-it-cant-justy-fy-selling-a-subcompact-in-th/) originally appeared on Autoblog (http://www.autoblog.com) on Wed, 23 Dec 2009 13:58:00 EST. Please see our terms for use of feeds (http://www.weblogsinc.com/feed-terms/).

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