A company that was set up in Japan during the year 1953, Subaru is the automobile division of the automobile conglomerate Subaru Corporation which has operations in areas such as aviation, industrial products etc other than in the automobile sector. Subaru Automobiles are present in almost 80 countries across the world and they manufacture and sell sedans and SUV’s , their popular brands being Impreza, Legacy, Cross back, Forester, Outback, BRZ, WRX etc.
One of the biggest successes of the corporation is the presence of the Subaru Global Platform which integrates the various divisions of the company trying to bring in best practices wherever possible. The company has registered an annual turnover of around ¥3,325.992 and makes around 1,065,000 units of cars as per the year 2017.
Strengths in The SWOT analysis of Subaru
Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. The following are the strengths of Subaru :
- Market Leadership in the US: Most of the carmakers in the world try their best to gain a foothold in the American market and Subaru has been a successful model in the market. The company has registered a higher sales than BMW, Mazda, and Volkswagen.
- Clear segmentation: Subaru has been targeting clear segment and since most of their vehicles cater to longer drives and rougher terrains the typical customer is a lover of outdoor activities and a physically active person. Subaru is also a favorite amongst rally drivers.
- Feature-rich cars: Just like most other Japanese carmakers, Subaru also makes superior vehicles which are feature rich. The cars they make are reliable, durable and high on performance as well as stylish and different.
- Technology savvy brand: Subaru makes technically superior cars with a lot of importance given to driving safety. Some of the technology used here include EyeSight Technology, Adaptive Cruise Control, Pre-Collision Braking and Lane Departure warning etc.
- High resale value: The aftermarket for cars is robust in the USA and the trend has now shifted to other countries as well. This means that the resale value of the vehicle is a critical aspect in a customer deciding to choose one car over another. Subaru has high resale value and also a preferred brand in the used cars market. This increases its preference amongst customers.
- High brand loyalty: The brand loyalty is high for Subaru customers and thus the repeat business is also high for the company. The primary reason for this is the driving comfort of the Subaru vehicles. Their cars are also high on reliability and driving comfort.
Weaknesses in The SWOT analysis of Subaru
Weaknesses are used to refer to areas where the business or the brand needs improvement. Some of the key weaknesses of Subaru are:
- Certification issues: Subaru had to recently pull out around 25000 cars from the market because of certification and testing issues. The reason stated by the company was that they did not have certified professionals for doing the testing.
- Increase in sales volume: Subaru has experienced a sudden surge in the number of customers and with the existing infrastructure and production capabilities it would be a challenge to meet the increased demand. There is also a need for more research to understand the customer needs better.There is also the need for a wider service network.
- Repositioning: The company is attempting to reposition itself and there is feedback that the customers find the seating uncomfortable and the legroom insufficient. The company has improved on these aspects and is trying to improve the acceptance by focusing on these factors in the promotions.
- Dealer relationships: The company is trying hard to keep their dealers in the loop and need to focus on building the relationship with them. They are trying to incentivize the dealers better and relate their incentives to the sales from each dealer which in turn is proving to be expensive for the company.
Opportunities in The SWOT analysis of Subaru
Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. Some of the opportunities include:
- High market potential for small cars: Subaru currently has cars in the SUV and sedan segments but not too much presence in small cars. However, the market for small cars is on an increase as per current research which means that this is an opportunity that the company capitalizes on.
- Changing customer preferences: Customers are now willing to pay more for more features and better services. The carmakers now need to understand the real needs of the customer apart from knowing the product feature expectations and cater to those which can create new opportunities for monetization.
Threats in The SWOT analysis of Subaru
Threats are those factors in the environment which can be detrimental to the growth of the business. Some of the threats include:
- Competition: The main competitors of Subaru are brands like Honda, Toyota, Nissan, Chevrolet,.Renault and Ford. The company also faces some amount of competition from regional players in each of the local markets.