A wonderful Friday to you all and welcome back to another round of The Autopian’s daily news rodeo. Today we’re talking about Subaru, Tesla (again, sorry), Ford’s surprising AI plans, and the ways car dealers are fighting back against irrelevance in the digital era. It’s all going to be very exciting, of that I can assure you!
Subaru Gets A New Boss As The World Changes
Let’s get this out of the way first: Subaru is hardly a brand in need of rescue. It’s been shockingly successful for such a tiny company over the past decade and change, offering reasonably priced, weather-capable options (and the occasional BRZ) that have resonated with countless families everywhere. In Brooklyn where I live, if you have kids, you are basically issued an Outback or a Crosstrek upon arrival. The only thing that’s really dampened Subaru’s momentum in the past few years has been the pandemic-related supply crunch.
But from a car reviewer’s perspective, doesn’t Subaru feel a bit… stagnant, in some ways? The last fully new-new car it came out with was the Ascent SUV and that was in 2018. The electric Solterra is… well, it could’ve been a lot better. The styling, tech experience and even performance of the rest of the lineup is just fine. Successful as it is, it feels like Subaru’s been resting on its laurels for more than a minute. [Editor’s Note: There are the “Wilderness” cars with tweaked exterior styling and increased ride height. Those were a smart move for Subaru, I think. -DT].
And then there’s the challenge of What’s Next—navigating the world of electric, connected and potentially autonomous vehicles. In many ways, Subaru’s trajectory mirrors that of its close partner and investor Toyota, as well as much of the rest of the Japanese auto industry. It hasn’t really taken the lead on the tech front, although you can kind of forgive Subaru for that because it’s so tiny. (Then again, by contrast, Mazda is also small and look what it’s up to these days.)
Anyway, like Toyota, Subaru’s about to get a new, slightly younger CEO and he–Atsushi Osaki—will be tasked with navigating the future challenges for the brand. Here’s Automotive News on what he wants to do next:
His tasks include future-of-cars stuff, improving quality, seeing what growth can still be squeezed out of Subaru’s giant U.S. market (especially with the Inflation Reduction Act incentivizing local EV development) and more. His predecessor Tomomi Nakamura was pretty aligned with Akio Toyoda on the EV front, but they’re all realizing that has to change:
Hopefully, Osaki can navigate all of this and inject a little freshness into Subaru as a brand in the U.S. Also, I sincerely hope cars like the WRX aren’t left to die on the vine in the EV era, but again, Subaru’s small and it can only do so much.
Tesla’s Investor Day Was Boring And Maybe That’s Fine?
I actually missed Tesla’s Investor Day presentation on Wednesday because I was flying back to New York from the Lexus RZ launch in San Diego (review coming soon!) The thing is, I didn’t actually miss anything at all. The big news was… a diner? Heat pumps? Probably the Mexico plan, that’s a major deal.
But what we didn’t get was news on major Autopilot updates, or the long-rumored new EV platform, or a plan for new model rollouts. As I’ve said countless times before, Tesla’s EV lineup is good—in many ways, still the best overall EVs you can buy right now—but it’s getting old and the competition is heating up quickly. Unveiling plans for a couple of brand-new crossovers, maybe one or two sedans, and something totally unexpected would’ve been a huge mic drop. No wonder investors didn’t really give a shit afterward.
But over at The Verge (which, full disclosure, is a publication I contribute to pretty regularly these days, although I was not involved with this one at all) Transpo Editor Andy Hawkins argues that the boringness actually wasn’t a big deal at all.
Why? Because it represented some degree of focus, which is notably absent from Elon Musk’s repertoire. And the eco-friendly message of it all represents Musk’s apparent thesis for the company’s future:
Look, saving the Earth rarely makes an exciting tech presentation. But Musk’s savior complex has taken a beating over the years. His bungled acquisition of Twitter has exposed his more reactionary tendencies, which has been a huge turnoff for some of his progressive-minded customers. The failed promises (“1 million robotaxis”) and delayed products (Cybertruck when?) have taken a toll on his reputation as an entrepreneurial visionary and all-around business genius. A 760mph hyperloop became a 50mph “Tesla in a tunnel.”
Maybe dialing back on the unfulfilled promises and focusing on the things you still need to accomplish is a good thing. Tesla’s previous Master Plans have been largely hit-or-miss. Part Deux, especially, remains broadly unfulfilled. And specifics of the third part of the plan still need to be fleshed out; Musk has promised a detailed white paper is forthcoming — but it seems to wisely steer clear of any benchmarks and deadlines that could be used to undermine Tesla’s credibility in the future.
Ford Isn’t Done With Self-Driving Cars
Speaking of false promises, 2022 was a crushing reality check of a year for autonomous cars. Arguably the highest-profile example was the death of Argo AI, which had investments from Ford and Volkswagen and seemed to be more legit than most of those startups. And on the consumer side, automated driving assistance programs continue to be plagued with problems and user mistrust.
The Dearborn, Michigan-based automaker added it hired about 550 employees who previously worked at Argo AI for its new subsidiary.
Ford, which jointly ran Argo with Volkswagen AG, booked a $2.7 billion non-cash pre-tax impairment on its investment in the unit and laid off some employees.
Latitude, which will be led by Ford’s executive director of ADAS Technologies, Sammy Omari, is headquartered in Pittsburgh with additional engineering hubs in Dearborn, Michigan and Palo Alto, California.
Dealer Fight
Finally, do not expect the car dealers to go gently into that good night. While there’s a version of the future where cars are bought online, need less maintenance thanks to OTA software updates, and can be repaired by remote mobile technicians, that’s not the most realistic approach—and the dealers are still deeply entrenched in the industry thanks to strong franchise laws.
Automotive News has a good overview of the state-by-state fight that’s brewing right now as traditional car dealers seek to protect themselves from a raft of changes.
The Mississippi Senate gave final approval Thursday to a bill to restrict electric car manufacturers from opening new brick-and-mortar dealerships in the state unless they comply with the same laws traditional carmakers follow.
[…] The bill does not restrict the direct sale of electric cars, as people can buy them online. But if they want to buy an electric car in person, they would have to drive to the state’s only Tesla store in Pearl, which would be allowed to remain open under the proposed new law. Tesla or any other electric car company could not open a new brick-and-mortar location to sell cars unless they enter a franchise agreement.
Back To You
Congratulations! You have actually defeated new Subaru chief executive Atsushi Osaki in an exhibition race at the All Japan Rally Championship. He was more than a worthy opponent, but at the end of the day, you just out-drove him. And according to the company’s peculiar bylaws, that means you are the new CEO of the Subaru Corporation.
It’s a weird rule, I know, but it keeps everybody honest.
Now that you’re in charge, what do you do with Subaru? Good luck! You got this. Probably.
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When I broke into the car biz in 1977 the talk was already about moving away from the salesman experience when buying a new car. Things like furniture and appliances were showing up in department stores with price comparison shopping and the resulting competition becoming a thing. Folks were asking the question “why can’t I buy cars like that, too?”
Did we protect the Pony Express workers when the telegraph came along? Are we making sure newspaper employees keep their jobs since the Internet arrived?
Point being, things change. Progress moves along. We can now know every new car model’s options and pricing before stepping foot in a dealership but we still have to endure the salesman’s four-square payment pressure and F & I shenanigans when every credit union in the world can have that all worked out before buying.
I’ve worked for a lot of dealers. There are a lot of those folks who would lose their jobs with direct factory sales. And there needs to be a dependable repair network for warranty issues.
Aside from the warranty repair issue, I don’t see how this new car version of the Pony Express can be propped up much longer without major bribes and lobbying.
But mechanic certifications exist. Separate repair facilities have been proposed for decades. Parts department inventories have shrunk for years due to quick deliveries. I just can’t see the justification for having ten Chevrolet dealers in every city over 200K population any more. Ten warranty service centers, yes. But dealers? Dinosaurs. The Internet was their asteroid.
I can’t think of too many industries where retailers have a strong enough lobby to force manufacturers to sell through them instead of directly to consumers.
It seems awfully…un-free-market.
In fact, I’d go so far as to say that maybe no retailers should have that strong a lobby.
Musk said last year that the Optimus robot will be more than half of Tesla’s future income and he said it again yet almost no one even mentions this.
EV BRZ, EV WRX. Like everyone else says for the ICE stuff get rid of the boxer and cvt. I’d love to see their take on a hybrid high performance EV as someone else said. But the way they introduced the Solterra… is not a great start. Give the hippies their EV versions of your best sellers and they’ll be happy. So EV Foresters by the thousands I guess.
My makeover for Subaru:
1. More Manuals. Your cars are ugly and pretty much always have been. You need to accept that you’re the ‘weird’ brand and offer some weird things like third pedals. This may also help the brand in the off-roading world.
2. Drop the Boxer. What’s the point? Other manufacturers are getting more power and MPG from I4’s of similar displacement. There is no ‘center of gravity’ reason to keep the boxer. Only two models are performance-oriented (WRX, BRZ) and those both would be better with more power than a COG benefit that can be completely undone by an average American setting their seat 1/2″ higher in the cabin. Build it yourself or buy it in from Toyota.
3. More Ugly. Become more weird. Make an off road version of something that isn’t a styling package. Make a dune buggy. Make a 3-row SUV with a full-length folding canvas top. All the money spent being weird under the hood with the stupid boxer engine could be spent making any of these things, which would promote the brand more effectively.
4. Hybrids. You’re selling adventure, and your BEV offering doesn’t seem to have much range. Make a hybrid. Have a special ‘charge for camping mode’ that charges the battery to max in the last half hour of driving to the camp site. Include an adapter that lets campers plug in their 120VAC devices while camping.
The only things that can be fixed with OTA updates are software bugs and calibration mistakes. Admittedly, in today’s car designs there are a lot of bugs and bad calibration assumptions, but OTA won’t fix worn out parts, bad sensors, failed cameras, glitchy screens, zapped power supplies, or just bad mechanical designs. And there are even more of those.
Actually “dealeships=bad” is the correct take, and I’m gonna give you the ultimate argument: does the direct-sales model pour money into politicians pockets to outlaw dealerships? no? is the dealership lobby doing it? yes? then there you have it.
If you need political bribes and laws to prop up your anti-consumer business model by shielding you from a competing model, then not only is your models shit, but YOU KNOW IT, which is why you spend the millions lobbying for it.
Oh, and for the “jerbs!” crowd, should we start making laws about protecting whips & buggies manufacturers? how about subsidizing coal-mining? (West Virginia excluded form my rhetorical question, they’re already doing it).
The times are-a-changing and the world changes with them, just as it always has. Clinging to the “old ways” is not the way.
Throw some performance EVs in the mix, Subaru. Right now, it’s “‘splodin’ in spectacular and/or catastrophic fasion” that makes a Subaru a Subaru, regardless of what the propaganda tries to push about love or whatever.
Subarus that don’t ‘splode as much as the current crop of ICE-powered Subarus are a legit threat, and honestly fit pretty well with both the performance side and the overall appealing crunchy vibe of the company.
Even I would be tempted by that, provided y’all quit putting hideous plastic cladding all over everything in a manner that even the Pontiac Aztek blushes at.
Bonus: Nitro Rallycross cars are already electric, and Vermont SportsCar already runs one. I’M JUST SAYING.
Also, we’re bringing back the STi and the Brat, nerds.
I feel like Subaru has lost the thing that used to make it stand out from other brands. Their whole thing used to be that all of their cars come with AWD as standard. They also had some great early crossovers in the form of the Outback and Forester. The problem is, that is now what literally every manufacturer is doing, and Subaru isn’t even necessarily doing it better than the competition.
What else have they got? Styling? Um, no. Interior quality? Well, it’s fine but it’s nothing special. Driving dynamics? Their performance offerings are decidedly half-assed, and none of their other models even pretend to be fun drivers. Reliability? Middle of the road, as far as I can tell. Value? Their pricing is fine, but hardly spectacular. Technology? They’re keeping up I guess, but that’s it. Brand loyalty? Maybe a little bit in New England, but even that’s a stretch. A commitment to the boxer engine layout? Nobody cares. Fuel efficiency? Don’t make me laugh.
Why would anyone pick Subaru over the competition? What’ve they got? Seriously, what?
Subaru has brand loyalty and cult followings not only in New England, but also in Colorado, and in the PNW region.
That said, they used to have the simplest, most engaging AWD system in the business, and the option of both MTM and conventional automatic on most models, even while other brands mainly offered FWD-based-and-biased AWD systems and increasing numbers of CVTs. Now Subaru is trending the same direction for the usual fuel efficiency reasons and their models are less interesting with each passing year.
Exactly this. I had owned 9 Subarus, all manuals, all wagons. With snow tires they were perfect for Maine, dogs, and practical. I’d pass people who went off the road in big trucks, SUVs and stuff all the time. It was like a family vehicle that had a little rally car secret mode you could unlock in winter. From 2012 I stopped caring about Subaru since they went CVT and chased mainstream growth.
There is definitely a cult following in NE and a few other pockets in the US. About once a month in my town I notice that the car in front of me and behind me in traffic are both Foresters of the same generation in the same color as mine. Not long ago, I would have counted myself among the faithful. I’ve been putting off a new car purchase and Subaru’s lineup has become even less interesting to me over that time.
We have an Outback (5MT) and a Forester (6MT). We’ll probably be replacing one of them with a Prius Prime. They’re both fine for a few more years so I can wait out markups.
Your new overlord says every Subaru is going 100% Plug-in Hybrid EV (PHEV) or manual.
Going PHEV will get electrification without using all the available battery cells on just a few cars. About 20-30 miles winter range is enough for each Subaru. That’ll go about 40-50 miles in the summer. Going PHEV will also get rid of the stupid, high maintenance, unreliable, and expensive to fix CVTs in favor of rock-solid, low maintenance ECVTs.
Everything that’s not a plug-in hybrid gets a 6-speed manual transmission. Every single model gets this option. Everything manual gets a turbocharged performance version, which means every model gets this option, too.
And we’re bringing back the Brat.
Ta-da! Subaru fixed for at least the next 10 years.
Subaru needs to go hard on EV’s. Especially ones that can handle a bit of a rougher road without costing Rivian money. There’s a niche there that they’re primed to fill. People already think Subaru for outdoorsy vehicles. They don’t need a ton of range but do need fast charge speeds. Like 120 miles in 20 minutes kind of speed.
To fund that, WRX the Crosstrek to fill in the WRX hatch role. Make the more butch Ascent. Make hotter versions of everything with a WRX-Line or something hotter than the turbo XT’s without diluting the WRX brand.
I was with you all the way until you said “They don’t need a ton of range but do need fast charge speeds. Like 120 miles in 20 minutes kind of speed.”
All electric vehicles that aren’t secondary transportation or hybrids need either a ton of range, or 120 miles in five minutes kind of speed.
Regarding Subaru… one way they can inject some freshness is if they make a new all-electric WRX… or at least make a hybrid WRX.
Regarding the dealer fight:
“Several state dealer associations are BRIBING POLITICIANS TO back SHADY ANTI-CONSUMER legislation to amend franchise laws that govern the relationship between dealerships and the automakers whose brands they sell. ”
There… fixed it for accuracy.
And if I was in charge of Subaru, the next Subaru STI models would be high performance BEVs on a dedicated BEV platform that may or may not be a derivative of the platform used by the Solterra.
And I would start with STI versions of the Forester and the Impreza.
And that in turn would enable Subaru to start selling high performance vehicles in Europe again.
I could never own a Subaru. I have eyes. Most hideous stupid looking car brand by far.
But if you were in charge, you could change that!
“While there’s a version of the future where cars are bought online, need less maintenance thanks to OTA software updates, and can be repaired by remote mobile technicians, that’s not the most realistic approach”
Congratulations on understatement of the year.
I’ve beaten the fact that ‘OTA will totally scale and solve all problems’ is nothing but a lie into the ground enough times. Because it is. (Reminder: you want to argue about this with me, you need a minimum 20 years of hands-off firmware and software upgrades including minimum fleet sizes of 50k+.)
But riddle me this. Who among you wants to have a ‘mobile technician’ repainting your car on the street under a pine tree? Uh-huh. How about swapping the 3000lbs battery with some Harbor Freight jackstands, a low-lift jack, a furniture dolly, and ratchet straps? Mmhmm.
Cars are large, complex machines which have more failure modes than you can count. Not even factoring in collision. No, you cannot count them. Ask any competent, experienced mechanic. Removing the idle air control doesn’t eliminate the window regulators.
“Sure, there’s a “middle man” feeling to it all, but is it better for the world if the car company just pockets all the profit versus dealerships getting in on it?”
Finally, somebody who gets it. And along come the fools screaming “NO NO NO STEALERSHIPS ARE POCKETING ALL THAT SERVICE CASH!!” Yeah, go ask your local service writer about warranty book rates and how much ‘profit’ they get off that. Or off oil changes.
The answer is that they might make a few pennies off them, and most likely the second is a ‘loss-leader’ where they need the tire rotation to make a few bucks off it. If it’s ‘complimentary’ oil changes, they’re definitely losing money. They basically live and die by post-warranty and high-margin maintenance service, even when they’ve got nothing but Grand Poobahs who can beat any warranty book job by 25%.
Doesn’t make the ADM bullshit they’ve been pulling ethical in the least, but that’s why they all glommed onto it at light speed. They’re being told to invest hundreds of thousands or even millions of dollars into EV equipment or lose their business, and the manufacturer isn’t providing ANY help or match. That money has to come from SOMEWHERE. And if they’ve been investing in the business responsibly, guess what? They don’t have that kind of lump sum. They shouldn’t! All that money was already put into replacing racks, upgrading alignment machines, redecorating the showroom, sending people to training, and so on.
The answer has NEVER been “dealerships bad.” Not once.
Yes. Some dealerships are absolutely fucking awful and deserve to go out of business. And that’s what the answer actually is. Manufacturers need to be able to hold dealerships responsible for being crap in a meaningful way. At the same time, dealerships need to be able to hold manufacturers responsible for their bullshit. Like demanding they bear all the costs to support a manufacturer that just reported yet another record profit of over $10B.
And customers need to be able to hold BOTH accountable. Which is why this will never, ever happen in the US. Not ever.
“Congratulations! You have actually defeated new Subaru chief executive Atsushi Osaki in an exhibition race at the All Japan Rally Championship.”
Truly a foregone conclusion. CEO RootWyrm is here to clean this… dear GODS.
Is it a Forrester? Is it a WRX? Is it a BRZ? No? Then axe it. Yesterday. Yes I expect you to invent time travel too, if you want to save the company.
Does it have a CVT? Axe it. Manual and traditional automatic. Have you SEEN our warranty claims and customer satisfaction numbers?! Just call ZF.
Does it have an engine warranty rate above 1%? Kill it, everyone who knew about the warranty claims and approved it anyways is fired, and don’t come back till you have something reliable.
NEW BENCHMARK: 1 windshield complaint per 50,000 cars per 36,000 warranty miles. I don’t care if you don’t like it. I am not going up on stage and being asked why a brand new car’s windshield turned concave. Also it’s a goddamn safety issue!
… yeaaaaaah, you know what, I quit.
TLDR
OTA’s are not a silver bullet. Agreed. Though, EV’s are mechanically much simpler. So there is some reduced need for service in the future. Overall, yeah, full- featured service centers should stick around.
*The answer has NEVER been “dealerships bad.” Not once.
Yes. Some dealerships are absolutely fucking awful.*
A vast, *vast*, majority of my experiences with car dealership sales staff has been negative. There is a single dealer that has earned my business by being honest, fair, and transparent (Granger in Iowa, 6hrs away). Every other one that I’ve dealt with can have the sales dept amputated as far as I’m concerned.
Me as the CEO of Subaru?
In order:
1.) Push an update to all current production CVT having Subarus to get rid of the fake shifts. It doesn’t help efficiency, reliability, or durability of the units.
2.) Tell the dealerships there will be NO markups on our cars or we’ll send you back to the stone age you greedy neanderthals.
3.) Get into immediate talks with Toyota to hybridize all the current Subaru models that are available with a CVT and in doing so replace them all with planetary e-CVTs like those found in almost all of Toyota’s hybrids.
4.) Fix the silicone sealant in the coolant issue
5.) Subaru Brat/Baja development
6.) Make all Wilderness models available with a manual
7.) State every future ICE Subaru will be available with a manual transmission under my reign.
8.) Convertible BRZ development
9.) Work with US legislators to get rid of the footprint rule.
10.) Work with US legislators to get rid of the Chicken tax
11.) BEV Subarus, not BEVs with Subaru badges slapped on them.
12.) Work with US legislators to exempt all pre 2008 vehicles from the 25 year importation rule with the only requirement being they must meet DOT lighting standards.
13.) Keep on fighting for Automotive enthusiasts, Subaru, and sensible transportation as long as I’m able to.
BRING BACK THE STI!
please….
5 door too
The only way the STI can come back is if it’s a hybrid or a BEV.
The last STI became unsellable in a lot of big markets like the EU because the fuel economy and emissions sucked.
*slow clap*
BRILLIANT!!
I agree with just about everything you said… especially #3 and #7. Just go all-hybrid or manual at this point and ditch the regular CVT as soon as possible. And implement a long term plan where they they have their own great BEV platform that they can build WRXes and STIs off of (referencing #11).
For #5… and make the Brat/Baha price-competitive with the Ford Maverick (at least in AWD trim).
And I strongly support #9, #10 and #12… but I won’t get my hopes up as you can expect Stellantis, Ford and GM to lobby to keep these stupid rules in place.
YES. Death to fake shifts forever. I don’t mind it if someone chooses paddles-mode, but otherwise, it’s 2023, people know what a CVT is, and a CVT should be allowed to operate like a CVT.
You’re hired!
Regarding legislation to protect dealers, I think TheAutopian lobbying arm needs to get some provisions added to such bills requiring dealers taking advantage of protections to donate a particular % of their revenue to an automotive journalism fund to ensure the long-term survival of TheAutopian and other lesser websites. A further rider on such bills should also prevent said dealers from having any editorial influence on these sites.
They can look to their past for inspiration. I love my 2020 STi, but I’d trade it in a heartbeat if I could get a 2023 STi wagon. Less than a heartbeat if I could get a bugeye 2023 STi wagon.
Bring back the SVX as a fast-as-shit AWD electric… could parter with Lucid motors on it. It’d sell in the tens (as a 2 door).
I would find a way to be one of those tens of buyers.
Me in charge of Subaru? As was already pointed out, there are some styling issues in the lineup. Not sure how the money situation is there, but the challenge I think is to grow the brand without driving away its existing loyal following. I’d want to explore having something in the low end of the market, true basic transportation and recycle the Baja name on a more direct (i.e. hybrid and also EV) competitor to the Maverick.
Wilderness WRX. Its Subaru’s answer to the Raptor, TRX, etc.
That’s a winner, seriously. Especially if offered with decent manual and auto (non CVT) transmissions.
…and a hatchback.