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  #31  
Old 07-19-2005, 07:47 PM
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EddieSVX EddieSVX is offline
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Quote:
Originally Posted by Tofu
Re: Timing, marketing, and foisting our own hopes and dreams onto the shoulders of reality.

The WRX/STi were not particularly marketed by Subaru at all. If anything, Subaru, Mitsubishi, and to a lesser extent, Nissan, should be cutting checks to Polyphony Digital. Although the internationally savvy car enthusiast was aware of the old GC8 turbo Imprezas and Evo II and III Lancers, the Gran Turismo series did most of the work in exposing these cars to the general consciousness of the North American automotive world. Go find a mainstream car magazine article about an Impreza WRX or Lancer Evolution that predates the release of the first Gran Turismo game. Now compare it to the ramped up frenzy of articles that date from GT2 to when the first US-legal copies of the WRX and Evo hit US shores. GT had everything to do with making these cars an aspirational object, and in the world of car marketing beyond the $25000 family sedan plateau, that is king. All Subaru and Mitsubishi had to do when the WRX and Evo were ready, was to just make people aware that they were for sale now. Everyone who was going to buy one already knew the salient points: the quickness, traction, power, heritage, and pedigree were never needed to make people want one. They already knew about it and already wanted one before the first ad ever appeared in print, or on the airwaves.

So the WRX/STi gets a pass as not being truly representative of Subaru's marketing prowress, or their place in the pantheon of the American consumer's list of desireable automobiles. They don't really count, since Subaru didn't have to exert much effort at all to get people to want one.

It's a tricky business, the idea of becoming an aspirational nameplate. Toyota has neatly pulled it off with Lexus, while Nissan and Honda have been much less successful doing it with Infiniti and Acura, respectively, and Mazda never got the chance after it canned the Amati project at the beginning of the '90s. While you never hear anyone really pine to own an RL or a Q45, Lexus has managed to position itself among the big three German brands in terms of being something that people want - in addition to being objectively very good - simply for the cachet that buying it represents. A Legacy GT is probably 99% of the car a BMW 530 is, and probably a better car then a 3-Series, but most people will disagree. And not for any better reason then they are responding to a shared societal view that because people want BMWs, then they must be better then other cars, so they want one too.

As it is, Subaru is not a particularly aspirational nameplate. Not counting the WRX/STi, which, as niche products, are fantastic to have but won't make or break the company, the Outback is really the only nameplate that represents something that the great unwashed masses view as a car to long for. The Outback has great brand equity, and even though I got sticker shock just looking at a new one the other day, Subaru is on the cusp of that great automotive position of being able to have people pay the sticker because the nameplate, in their mind, is worth it. The Legacy GT, on the other hand, is a fantastic car that is not getting nearly enough of a marketing push from Subaru. This is a car that in every way except perhaps at the ragged edge of cornering limits, can stand in with any $30-$40K sedan in the world, and some that are pricier even then that. It is too good of a car to be relegated to the bottom of people's shopping lists.

Time will tell, but Subaru is making some inroads into the game of being an object of desire, and not simply bought because they are "Inexpensive and built to stay that way". That's the difference between an also-ran and a frontrunner. Mitsubishi says "Buy a Galant because it's as good as a Camry!", while Toyota says "Buy a Camry because it's a Camry!". The Outback is a good start to build on. If they can convince more people to make an emotional connection between an Impreza 2.5 and the STi, so much the better. If they can successfully market the Tribeca then they are marketing gods.

Ultimately though, all of Subaru's products are a reflection of the brand values Subaru stands for in a way that the SVX wasn't. Subarus reflect practicality, ruggedness, the allure of AWD traction, dependability, and some surprisingly quick, athletic versions of such. When people think of Subarus, they don't generally think of large, opulent, expensive grand touring coupes. And there's nothing wrong with that. Success for Subaru will be based on continually playing to their strengths (and convincing people that the new corporate schnozz is great design), and continually improving upon what they do best. Best to stick with what you're good with and not be distracted by shiny objects along the way.

Personally, I'd much rather not see an attempt at another SVX. The SVX is special partially because it didn't fit in at the time. It was wasn't the right car for Subaru to devote resources to, but they did anyhow. No one understood them when they came out, and dealers had struggled to give them away after they did. Only the devoted few saw all the good things hidden under that unconvential skin, and as time passes by they will be more and more rare, more and more special, and hindsight will provide more and more appreciation of what they really were. Think of some other examples of the breed: the split window Corvette, the Shelby Cobra, the Tucker Torpedo, the Chrysler Airflow, the Dodge Charger Daytona. All outrageously styled, all sold like coldcakes, all now highly desireable and loved. That's not bad company to be in.
You bring up some good points, but don't seem to truly understand marketing. Mitsubishi and Subaru both took advantage of the "free advertisement through Gran Turismo", which is, in my book, a great marketing strategy. It's what marketing is all about... However, what Subaru had been lacking throughout the years up until now was a strong following by a broad audience.

Think Toyota in the 70's and early 80's, and where they're at now. Most of their current models have trim levels which can easily surpass $30k MSRP moderately equipped. That includes the Camry, which happens to be the best selling car in the US.

As a company, you look at the bigger picture and find ways to draw consumers into your ideals. Once you got their trust/loyalty, you can get away with releasing, on a limited basis, flagship products that establish a backbone. A way to gain bragging rights for having a vehicle in your line that provides world class luxury and performance all in one.

Subaru definitely gained more ingredients to achieve a successul run of a flagship product since the release of the XT and SVX. From a marketing standpoint, the timing is as close to being just right as it ever was.

And, while we have casually brought up the names of other manufacturers who have struggled hard in the past and made a successful name of themselves, let's not forget Hyundai... You know, I used to always poke fun of the little ugly sons of *****es, but to be quite honest, I'm not so sure they desrve to be made fun of as of late. Their quality and reputation has grown exponentially in the past few years, and if you look at the new Sonata you can see a reflection of the Toyota and Honda success encapsulated into a vehicle manufactured by a company that I quite honestly never thought would make it past the late 90's.
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  #32  
Old 07-19-2005, 11:08 PM
legacy852
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Isn't there an SVX in Gran Turismo 1 or 2? for the playstation I? Anyway I need to buy it if there is. I know 3+4 don't have it.
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  #33  
Old 07-20-2005, 01:21 AM
Tofu
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Let's look at some of the examples you brought up:

Subaru did not "take advantage of free advertising" through the GT series. Don't get the impression that FHI execs were sitting around thinking "Gosh, I wish we could sell our WRXen in the US, if only someone would just advertise it for free! What's this? A video game? By god I think we have it!" Rather, GT was a platform that brought Subaru's attention to the fact that there was a potential market for the WRX in the US. No one at FHI thought that there would be enough sales to justify the expense of re-engineering the WRX for the US market. The GT series, and the subsequent explosion of the tuner aftermarket showed them otherwise. In that sense, the cart really did come before the horse.

The other thing you over simplify is this notion that if Subaru had a "strong following followed by a broad audience" then said audience would eagerly buy whatever Subaru decided to slap it's logo on. Also not even close to the truth. VW has an extremely widespread and loyal market for the Jetta, for instance, and yet the Phaeton, which is a direct result of the kind of hubris you allude to, sells like poison cupcakes, which is to say, hardly any at all. Why? Because the very nature of a broad and strong audience pigeonholes you into the market that you have defined for yourself. To break out of that market requires starting high, and moving downmarket, where the cachet of your name will make sales (like Mercedes with the A and B-Class, and the nasty C-Class hatchback), or attempt to move upmarket. To pull that feat off, which is extremely difficult, you have to convince the public that your brand belongs in the rarified air. It worked for Toyota and Lexus. It barely worked for Nissan and Infiniti, and ironically, unlike Lexus, Infiniti's most successful and desireable offering is it's "entry-level" G35. After the demise of Amati, Mazda tried moving upmarket with the Milennia and the 929, which was met with thundering indifference. VW is finding that there is extreme market resistance above the $40K mark - the Phaeton and the W8 Passat were both resounding failures (the Toureg does well but benefits from the ongoing SUV craze). It took Audi more then 20 years to be seen as an equal player to BMW and Mercedes.

If Subaru strengthens the brand equity that consumers value, then expect to see a kickass Outback or an M5-style Legacy GT sometime down the road, not a luxury GT coupe.

Let's look at another company you cite, Toyota. That Toyota is extremely successful is obvious. Sometime in the next ten years, Toyota will surpass GM as the number one car company in the world. In a time when companies like GM and Ford are losing billions of dollars a year, Toyota usually has between $20-$30 billion in cash reserves. In a business where the average profit margin hovers between 2 and 4%, Toyotas generated an average of 16% profit margin over the last five years. That Toyota has reached this elevated position is the result of fifty years of single minded purpose. Although Lexus is the brand that uses the tag "The relentless pursuit of perfection", that's been the Toyota way since WWII. The Toyota mission statement and production methodology have been covered in dozens of business, manufacturing, and management books as one of the best in the world. Toyota's current position is a result of careful, conservative, and calculating management, slowly and steadily building on the company's strengths. Ever wonder why Toyota does not currently produce any sports cars? They knew there was no money in it. The most exciting two door Toyota is probably the Tacoma X-Runner. No Supra, no Celica, no MR2. Even the passionate cars in Toyota's lineup live and die by Toyota's long term global planning. If a Supra does return to Toyota's lineup, it will be because there was a business case for it, and not simply because it's a cool car, or because they can. The Camry is the number one selling car in America because it does everything competently, has great reliability, and benefits from twenty years of Toyota brand equity emphasizing those values. It is not the number one selling car because it is the fastest, best handling, or best looking. Unlike the VW Phaeton, which was largely a project driven by one man's ego, the Lexus LS430 is a cold, calculating business proposition. That it is so good is more a result of Toyota's passion for fundamental soundness in engineering and design, less a result of hotheaded "wouldn't it be cool if?" thinking.

Incidentally, the Camry outgrew even Toyota's legendary brand equity and marketing abilities. The 1992-1996 model was designed in tandem with the ES300, and content and, by association, cost spiraled out of control. Much like Mercedes did with the S-Class, Toyota engineers had to be restrained for the next generation Camry, with price and cost appropriate content. Prices on that generation Camry was one reason Toyota did not have a stranglehold on the #1 sales slot during those years. The lesson, again, is that brand equity and strong customer loyalty do not equal free pass to make and sell anything for any price, just because a lot of people like your cars.

The success of Hyundai, too, mirrors Toyota's cold-blooded business drive. For twenty years, all Hyundai did was learn to make cars, lessons compressed in two decades that it took American and European carmakes 80 years to learn. The first Hyundais were massive sales successes, due to pricing and marketing. As soon as people figured out that an Excel would fall into pieces within months, people stopped buying them. Hyundai learned that price and marketing were not sufficient and started figuring out quality. Their survival was never in doubt - Hyundai is one of the largest industrial corporations in the world, and the production of cars is a point of national pride in Korea - they just took the fifteen years between the 1991 Sonata and the 2006 Sonata to learn the final lessons of quality and design - lessons I'm not convinced some companies have fully learned in the last century of being in business. And remember that Hyundai's current success comes from three places: Price, as always, Hyundai's offerings are thousands less then competitors, the warranty, which costs Hyundai a ton of money but is calculated as the cost of increasing their brand equity, and last year's surprising JD Powers initial quality survey, which put the Hyundai in the rarified air of Toyota/Lexus, and Honda/Acura. The 2006 Sonata, which is a quantum leap over the previous Sonata, plays to those strengths. But there's a reason that the big Hyundai luxury sedans sold in Korea aren't sold here. They do not reflect the brand values that US consumers identify with Hyundai, and they would not be a sales success, and like Toyota, if it doesn't make business sense, then it's not going to happen, no matter how cool the idea is.

In the car business, ultimately, successful marketing consists of playing to your strengths. It's why GM's divisions always seem to be lost in the wilderness - some of those brands don't know what their strengths are, and it shows in their product and sales numbers. BMW markets to their strengths, and succeed, even with a crop of truly ugly cars. Mercury does not, and may not survive the end of the decade. Porsche can sell a counterintuitive product like the Cayanne because it still plays to Porsche strengths - speed and prestige, while VW cannot sell a counterintuitive product like the Phaeton.

Every car company in the US has the capability to produce an amazing, fast, luxurious flagship vehicle. But the ultimate lesson of Toyota's overwhelming success (they are so far ahead of the competition in terms of market, sales, and overall financial strength it's like comparing Lance Armstrong to a bunch of kids on Big Wheels) is that just because you can do something, doesn't mean you should do something. Subaru is enjoying some successful brand strengthening right now. Subaru had a strong brand back right before the SVX was introduced. The SVX back then had a hand in almost killing Subaru. If you're a real Subaru fan, that's the last thing you'll want to see now, wishful thinking or no.

Last edited by Tofu; 07-20-2005 at 01:27 AM.
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  #34  
Old 07-20-2005, 12:45 PM
Red SVX 92 Red SVX 92 is offline
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Quote:
Originally Posted by SVXtra
The SRT-8 has a 6.1-liter engine with 425 horsepower and 420 lb-ft of torque. That's more power per liter than the Street Hemis that reigned supreme in the mid 1960 to early 1970s. Not to mention numerous upgrades in suspension to include Brembo brakes. And with the addition of cylinder displacement on demand giving you 20 mpg and a very good Mercedes derived 4-wheel drive system arriving sometime next year the Charger SRT-8 will be on a performance level unheard of in any car costing less than 100K. Gentlemen,styling is subjective and always has been. Basically, its beauty in the eye of the beholder. But numbers do not lie. And what is a fully loaded SRT-8 Charger with 4 wheel-drive going to cost? About 48k. I'm impressed.
Part of the problem, though, is that even with that much power, those cars are still not that quick. Weight and suspension and traction prevent any of the new Hemis from being competitive in acceleration when compared to cars with similar power ratings. Sure they're great for their class, say, family sedan for the Charger/300C, or pickup truck, or etc., but they give people the impression that they could keep up with sports cars like Corvettes and purpose-built quarter-milers like Camaros. This is unlike the Ford Lightning SVT, which has the power and the quickness to match and is often underestimated because it's a truck.

As for AWD, it can only do so much. Having AWD doesn't make a heavy Acura MDX a quicker, more responsive car; it simply makes it a heavy slug that's less likely to lose complete control.

I love the styling of the new Charger and especially the new 300C, but when I get that Hemi in a few years, I won't be deluded into thinking I can beat a Corvette off the line, which is the premise of many of the Dodge Hemi truck commercials and which is the belief of much of the general population.
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  #35  
Old 07-20-2005, 01:55 PM
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Quote:
Originally Posted by Tofu
Let's look at some of the examples you brought up:

Subaru did not "take advantage of free advertising" through the GT series. Don't get the impression that FHI execs were sitting around thinking "Gosh, I wish we could sell our WRXen in the US, if only someone would just advertise it for free! What's this? A video game? By god I think we have it!" Rather, GT was a platform that brought Subaru's attention to the fact that there was a potential market for the WRX in the US. No one at FHI thought that there would be enough sales to justify the expense of re-engineering the WRX for the US market. The GT series, and the subsequent explosion of the tuner aftermarket showed them otherwise. In that sense, the cart really did come before the horse.

The other thing you over simplify is this notion that if Subaru had a "strong following followed by a broad audience" then said audience would eagerly buy whatever Subaru decided to slap it's logo on. Also not even close to the truth. VW has an extremely widespread and loyal market for the Jetta, for instance, and yet the Phaeton, which is a direct result of the kind of hubris you allude to, sells like poison cupcakes, which is to say, hardly any at all. Why? Because the very nature of a broad and strong audience pigeonholes you into the market that you have defined for yourself. To break out of that market requires starting high, and moving downmarket, where the cachet of your name will make sales (like Mercedes with the A and B-Class, and the nasty C-Class hatchback), or attempt to move upmarket. To pull that feat off, which is extremely difficult, you have to convince the public that your brand belongs in the rarified air. It worked for Toyota and Lexus. It barely worked for Nissan and Infiniti, and ironically, unlike Lexus, Infiniti's most successful and desireable offering is it's "entry-level" G35. After the demise of Amati, Mazda tried moving upmarket with the Milennia and the 929, which was met with thundering indifference. VW is finding that there is extreme market resistance above the $40K mark - the Phaeton and the W8 Passat were both resounding failures (the Toureg does well but benefits from the ongoing SUV craze). It took Audi more then 20 years to be seen as an equal player to BMW and Mercedes.

If Subaru strengthens the brand equity that consumers value, then expect to see a kickass Outback or an M5-style Legacy GT sometime down the road, not a luxury GT coupe.

Let's look at another company you cite, Toyota. That Toyota is extremely successful is obvious. Sometime in the next ten years, Toyota will surpass GM as the number one car company in the world. In a time when companies like GM and Ford are losing billions of dollars a year, Toyota usually has between $20-$30 billion in cash reserves. In a business where the average profit margin hovers between 2 and 4%, Toyotas generated an average of 16% profit margin over the last five years. That Toyota has reached this elevated position is the result of fifty years of single minded purpose. Although Lexus is the brand that uses the tag "The relentless pursuit of perfection", that's been the Toyota way since WWII. The Toyota mission statement and production methodology have been covered in dozens of business, manufacturing, and management books as one of the best in the world. Toyota's current position is a result of careful, conservative, and calculating management, slowly and steadily building on the company's strengths. Ever wonder why Toyota does not currently produce any sports cars? They knew there was no money in it. The most exciting two door Toyota is probably the Tacoma X-Runner. No Supra, no Celica, no MR2. Even the passionate cars in Toyota's lineup live and die by Toyota's long term global planning. If a Supra does return to Toyota's lineup, it will be because there was a business case for it, and not simply because it's a cool car, or because they can. The Camry is the number one selling car in America because it does everything competently, has great reliability, and benefits from twenty years of Toyota brand equity emphasizing those values. It is not the number one selling car because it is the fastest, best handling, or best looking. Unlike the VW Phaeton, which was largely a project driven by one man's ego, the Lexus LS430 is a cold, calculating business proposition. That it is so good is more a result of Toyota's passion for fundamental soundness in engineering and design, less a result of hotheaded "wouldn't it be cool if?" thinking.

Incidentally, the Camry outgrew even Toyota's legendary brand equity and marketing abilities. The 1992-1996 model was designed in tandem with the ES300, and content and, by association, cost spiraled out of control. Much like Mercedes did with the S-Class, Toyota engineers had to be restrained for the next generation Camry, with price and cost appropriate content. Prices on that generation Camry was one reason Toyota did not have a stranglehold on the #1 sales slot during those years. The lesson, again, is that brand equity and strong customer loyalty do not equal free pass to make and sell anything for any price, just because a lot of people like your cars.

The success of Hyundai, too, mirrors Toyota's cold-blooded business drive. For twenty years, all Hyundai did was learn to make cars, lessons compressed in two decades that it took American and European carmakes 80 years to learn. The first Hyundais were massive sales successes, due to pricing and marketing. As soon as people figured out that an Excel would fall into pieces within months, people stopped buying them. Hyundai learned that price and marketing were not sufficient and started figuring out quality. Their survival was never in doubt - Hyundai is one of the largest industrial corporations in the world, and the production of cars is a point of national pride in Korea - they just took the fifteen years between the 1991 Sonata and the 2006 Sonata to learn the final lessons of quality and design - lessons I'm not convinced some companies have fully learned in the last century of being in business. And remember that Hyundai's current success comes from three places: Price, as always, Hyundai's offerings are thousands less then competitors, the warranty, which costs Hyundai a ton of money but is calculated as the cost of increasing their brand equity, and last year's surprising JD Powers initial quality survey, which put the Hyundai in the rarified air of Toyota/Lexus, and Honda/Acura. The 2006 Sonata, which is a quantum leap over the previous Sonata, plays to those strengths. But there's a reason that the big Hyundai luxury sedans sold in Korea aren't sold here. They do not reflect the brand values that US consumers identify with Hyundai, and they would not be a sales success, and like Toyota, if it doesn't make business sense, then it's not going to happen, no matter how cool the idea is.

In the car business, ultimately, successful marketing consists of playing to your strengths. It's why GM's divisions always seem to be lost in the wilderness - some of those brands don't know what their strengths are, and it shows in their product and sales numbers. BMW markets to their strengths, and succeed, even with a crop of truly ugly cars. Mercury does not, and may not survive the end of the decade. Porsche can sell a counterintuitive product like the Cayanne because it still plays to Porsche strengths - speed and prestige, while VW cannot sell a counterintuitive product like the Phaeton.

Every car company in the US has the capability to produce an amazing, fast, luxurious flagship vehicle. But the ultimate lesson of Toyota's overwhelming success (they are so far ahead of the competition in terms of market, sales, and overall financial strength it's like comparing Lance Armstrong to a bunch of kids on Big Wheels) is that just because you can do something, doesn't mean you should do something. Subaru is enjoying some successful brand strengthening right now. Subaru had a strong brand back right before the SVX was introduced. The SVX back then had a hand in almost killing Subaru. If you're a real Subaru fan, that's the last thing you'll want to see now, wishful thinking or no.

I haven't read that much since i was last in college.... stop writing so much!!!

Tom
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  #36  
Old 07-20-2005, 03:21 PM
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EddieSVX EddieSVX is offline
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Quote:
Originally Posted by Tofu
Let's look at some of the examples you brought up:

Subaru did not "take advantage of free advertising" through the GT series. Don't get the impression that FHI execs were sitting around thinking "Gosh, I wish we could sell our WRXen in the US, if only someone would just advertise it for free! What's this? A video game? By god I think we have it!" Rather, GT was a platform that brought Subaru's attention to the fact that there was a potential market for the WRX in the US. No one at FHI thought that there would be enough sales to justify the expense of re-engineering the WRX for the US market. The GT series, and the subsequent explosion of the tuner aftermarket showed them otherwise. In that sense, the cart really did come before the horse.

The other thing you over simplify is this notion that if Subaru had a "strong following followed by a broad audience" then said audience would eagerly buy whatever Subaru decided to slap it's logo on. Also not even close to the truth. VW has an extremely widespread and loyal market for the Jetta, for instance, and yet the Phaeton, which is a direct result of the kind of hubris you allude to, sells like poison cupcakes, which is to say, hardly any at all. Why? Because the very nature of a broad and strong audience pigeonholes you into the market that you have defined for yourself. To break out of that market requires starting high, and moving downmarket, where the cachet of your name will make sales (like Mercedes with the A and B-Class, and the nasty C-Class hatchback), or attempt to move upmarket. To pull that feat off, which is extremely difficult, you have to convince the public that your brand belongs in the rarified air. It worked for Toyota and Lexus. It barely worked for Nissan and Infiniti, and ironically, unlike Lexus, Infiniti's most successful and desireable offering is it's "entry-level" G35. After the demise of Amati, Mazda tried moving upmarket with the Milennia and the 929, which was met with thundering indifference. VW is finding that there is extreme market resistance above the $40K mark - the Phaeton and the W8 Passat were both resounding failures (the Toureg does well but benefits from the ongoing SUV craze). It took Audi more then 20 years to be seen as an equal player to BMW and Mercedes.

If Subaru strengthens the brand equity that consumers value, then expect to see a kickass Outback or an M5-style Legacy GT sometime down the road, not a luxury GT coupe.

Let's look at another company you cite, Toyota. That Toyota is extremely successful is obvious. Sometime in the next ten years, Toyota will surpass GM as the number one car company in the world. In a time when companies like GM and Ford are losing billions of dollars a year, Toyota usually has between $20-$30 billion in cash reserves. In a business where the average profit margin hovers between 2 and 4%, Toyotas generated an average of 16% profit margin over the last five years. That Toyota has reached this elevated position is the result of fifty years of single minded purpose. Although Lexus is the brand that uses the tag "The relentless pursuit of perfection", that's been the Toyota way since WWII. The Toyota mission statement and production methodology have been covered in dozens of business, manufacturing, and management books as one of the best in the world. Toyota's current position is a result of careful, conservative, and calculating management, slowly and steadily building on the company's strengths. Ever wonder why Toyota does not currently produce any sports cars? They knew there was no money in it. The most exciting two door Toyota is probably the Tacoma X-Runner. No Supra, no Celica, no MR2. Even the passionate cars in Toyota's lineup live and die by Toyota's long term global planning. If a Supra does return to Toyota's lineup, it will be because there was a business case for it, and not simply because it's a cool car, or because they can. The Camry is the number one selling car in America because it does everything competently, has great reliability, and benefits from twenty years of Toyota brand equity emphasizing those values. It is not the number one selling car because it is the fastest, best handling, or best looking. Unlike the VW Phaeton, which was largely a project driven by one man's ego, the Lexus LS430 is a cold, calculating business proposition. That it is so good is more a result of Toyota's passion for fundamental soundness in engineering and design, less a result of hotheaded "wouldn't it be cool if?" thinking.

Incidentally, the Camry outgrew even Toyota's legendary brand equity and marketing abilities. The 1992-1996 model was designed in tandem with the ES300, and content and, by association, cost spiraled out of control. Much like Mercedes did with the S-Class, Toyota engineers had to be restrained for the next generation Camry, with price and cost appropriate content. Prices on that generation Camry was one reason Toyota did not have a stranglehold on the #1 sales slot during those years. The lesson, again, is that brand equity and strong customer loyalty do not equal free pass to make and sell anything for any price, just because a lot of people like your cars.

The success of Hyundai, too, mirrors Toyota's cold-blooded business drive. For twenty years, all Hyundai did was learn to make cars, lessons compressed in two decades that it took American and European carmakes 80 years to learn. The first Hyundais were massive sales successes, due to pricing and marketing. As soon as people figured out that an Excel would fall into pieces within months, people stopped buying them. Hyundai learned that price and marketing were not sufficient and started figuring out quality. Their survival was never in doubt - Hyundai is one of the largest industrial corporations in the world, and the production of cars is a point of national pride in Korea - they just took the fifteen years between the 1991 Sonata and the 2006 Sonata to learn the final lessons of quality and design - lessons I'm not convinced some companies have fully learned in the last century of being in business. And remember that Hyundai's current success comes from three places: Price, as always, Hyundai's offerings are thousands less then competitors, the warranty, which costs Hyundai a ton of money but is calculated as the cost of increasing their brand equity, and last year's surprising JD Powers initial quality survey, which put the Hyundai in the rarified air of Toyota/Lexus, and Honda/Acura. The 2006 Sonata, which is a quantum leap over the previous Sonata, plays to those strengths. But there's a reason that the big Hyundai luxury sedans sold in Korea aren't sold here. They do not reflect the brand values that US consumers identify with Hyundai, and they would not be a sales success, and like Toyota, if it doesn't make business sense, then it's not going to happen, no matter how cool the idea is.

In the car business, ultimately, successful marketing consists of playing to your strengths. It's why GM's divisions always seem to be lost in the wilderness - some of those brands don't know what their strengths are, and it shows in their product and sales numbers. BMW markets to their strengths, and succeed, even with a crop of truly ugly cars. Mercury does not, and may not survive the end of the decade. Porsche can sell a counterintuitive product like the Cayanne because it still plays to Porsche strengths - speed and prestige, while VW cannot sell a counterintuitive product like the Phaeton.

Every car company in the US has the capability to produce an amazing, fast, luxurious flagship vehicle. But the ultimate lesson of Toyota's overwhelming success (they are so far ahead of the competition in terms of market, sales, and overall financial strength it's like comparing Lance Armstrong to a bunch of kids on Big Wheels) is that just because you can do something, doesn't mean you should do something. Subaru is enjoying some successful brand strengthening right now. Subaru had a strong brand back right before the SVX was introduced. The SVX back then had a hand in almost killing Subaru. If you're a real Subaru fan, that's the last thing you'll want to see now, wishful thinking or no.


I couldn't even conceive of the idea of reading so much while at work... I will read and possibly respond when I get home later on...

I did read a little, and I must say I already disagree with you on one thing... The reason for the Phaeton being such a failure, sales-wise, is because for not much more you can get an Audi A8 L. If Toyota sold a Camry for as much as a Lexus ES3xx series, nobody would buy a Camry... It's that simple. Also, VW has not gained the trust and reputation that you may think. The cult-following for the Jetta has remained among lower middle-class people who wish they could afford an Audi A4/S4. I know 5 people with Jettas and they always see Audis as the cars they wish they could've bought.

Your examples diverted from the original idea of having a limited-production flagship product. They are focusing more on everyday, mass production vehicles, some of which are shared platforms between brands (as is this case with the Phaeton and the A8). Subaru does not have the branding issues, even though some of their cars share with SAABs. Their relationship is more along the lines of the GM/Toyota relationship than it is the VW/Audi, or Toyota/Lexus, etc.

I could go on and on, but I don't really want to write as much as you. Not because I'm lazy, but because I just don't see the point. We'll just bounce back and forth all day. Don't mean that in an offensive way, and I have not taken offense to our disagreement either. Hope you feel the same way.
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Old 07-20-2005, 05:12 PM
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Your comments just reinforce the point: The Phaeton doesn't sell, even though it has the same platform, powertrain, and equipment levels of an Audi A8L, and is thousands cheaper to boot. The reason? Audi has the brand equity that VW doesn't. People will pay thousands more for essentially the same car because it says Audi, not VW.

And don't mistake people buying Jettas and wanting A4s as VW not having a strong customer base. That also reinforces the point; people that can't afford an A4 will buy a Jetta, because it's the next best thing to having what they really want. Very few people on this earth have the means to buy exactly what they want; the vast majority buys the closest thing they can afford. Those people are still making the same decisions based on perceived brand value that the people buying Maybachs and Rolls Royces are. VW has squandered some of their reputation among knowledgeable buyers due to some serious quality issues with the first few years of the A4 platform cars, but there are still plenty of blissfully unaware people who perceive the Jetta/Golf/Passat as being worth paying the premium over an Accord or a Camry.

Subaru indeed does not have cross-branding issues - the Saab 9-2X will most likely be a one-shot deal. That much is true. What you seem to be blissfully ignoring is that mainstream models have everything to do with the viability of flagship products. Why do you think Toyota, Nissan, and Honda have luxury channels? Their mainstream products define them in the marketplace, and an upscale badge is necessary to move upmarket. This is true outside of the US as well - Lexus is set to become Toyota's worldwide flagship brand, and in Japan, the SC430 outsells the visually and mechanically identical Soarer based on brand image and equity, as does the LS430 versus the Celsior.
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Old 07-22-2005, 12:10 PM
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Is there like a Coles Study Notes version of this thread? Maybe I'll just wait for the movie.
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Old 07-22-2005, 12:49 PM
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Is there like a Coles Study Notes version of this thread? Maybe I'll just wait for the movie.

I especially enjoy the 3 page posts that are then quoted and responded to with a 3 page post.


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Old 07-22-2005, 08:52 PM
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My $0.02: The resurrection of earlier labels is largely a bastardization of the earlier models with one very clear exception, the Ford Mustang. Look at the lines, the attitude, it's a VERY clear 1969/70 redux! Any future "SVX" would HAVE to be low-slung, 4wd window-within-a-window styling coupled with an uncompromised level of luxury.

http://www.cnn.com/2005/AUTOS/carrev...dup/index.html do the GTO and Charger models condure up their forbearers? No way, Jose!

I'd be insulted if Subaru rolled out a 2006 SVX econo-box that didn't feature the style and attitude that our SVX's personify!
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Old 07-25-2005, 10:25 AM
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The new Charger looks ok, for a new car, it however does no honor to the old charger. I had the honor to get a ride in the old charger and, all I can say is damn. The new Charger does not have the curves or the mean lookingness (ya, created my own word, sorry) of the old. The only new remake worthy of the old name is the Mustang. They did try to go back to the old look, and they look good.
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Old 07-26-2005, 02:24 AM
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Just my2c! I think to date the only car that could be considered as an SVX replacement is the B11s (i love that thing). But as we all know it can't be a real SVX replacement without having the window in window feature .Oh by the way you guys are right the only remake worth any mention right now is the Mustang. Unfortunately I could never and will never own a FORD GM and SUBARU are the only makes for me

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Old 07-26-2005, 02:38 AM
94svxred 94svxred is offline
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For those of you who have not seen the B11S. Here it is ! http://www.seriouswheels.com/top-200...1S-Concept.htm
I just love these two words TWIN TURBO I also will say if they do really make this car ,I'll be one of the first inline

Last edited by 94svxred; 07-26-2005 at 02:55 AM.
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Old 07-26-2005, 08:51 AM
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Quote:
Originally Posted by 94svxred
For those of you who have not seen the B11S. Here it is ! http://www.seriouswheels.com/top-200...1S-Concept.htm
I just love these two words TWIN TURBO I also will say if they do really make this car ,I'll be one of the first inline
thanks for reminding us about that red-headed stepchild. if Subaru does really make that car, i will put my faith in plummeting resale values and aftermarket grilles and bumpers.
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Old 07-26-2005, 04:04 PM
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the new Car and Driver has a rematch sorta of the new
Mustang Vs Charger Bullitt cars, pretty cool article
HA, at least one stayed a 2dr
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