How Subaru Turned from an Ugly Duckling into a Swan

Everyone loves an underdog story, and the story of Subaru in America is a great example. When Subaru first came to America in 1968, it faced an uphill battle. In fact, the operation almost folded before it even got off the ground. But with a little luck and a firm commitment to continuous improvement and understanding its customers, Subaru became the hugely popular brand it is today.

Subaru of America was launched in Philadelphia in February of 1968. It was brought to America by an entrepreneur named Malcolm Bricklin, who lobbied the Japanese company Fuji Heavy Industries to import its small car, the Subaru 360. Bricklin was intrigued by the tiny, fuel-efficient car that was so light (under 1,000 pounds) that it did not have to meet federal safety regulations. He hoped that Americans would embrace the inexpensive practicality of this car, much different from the large, roomy cruisers that dominated the American market. But there were many obstacles and disappointments before the ugly duckling became a success.

When Bricklin and his partner Harvey Lamm began selling the Subaru 360, they advertised it as being cheap and ugly, thinking that it would find a customer base with bargain-seeking consumers. They weren’t wrong in trying to establish a niche market for the Subaru, but they made some miscalculations. The Subaru 360 was the cheapest car on the market, but the Volkswagen Beetle was already more established in America and selling for just a few hundred dollars more. At the time, Americans chose the Beetle. On top of that, the Subaru 360 was featured on the front cover of Consumer Reports magazine paired with a scathing review calling the car “unacceptable” from a safety standpoint. Investors and dealers pulled support for the car, and Bricklin and Lamm found themselves with a large inventory of cars, few sales, and cash flow problems. Fuji Heavy Industries was embarrassed by the failure and tried to pull out of its deal with Bricklin and Lamm. It was not a good start, to say the least.

Subaru of America survived its early failure due to the vision of its founders, who pleaded successfully with Fuji Heavy Industries to allow them to keep selling the Subaru 360 in America. But the transformation of the ugly duckling into swan took more than persistence. Subaru learned from its mistakes and kept improving its vehicles. Rather than compete with the large automakers in making cars that appealed to everyone, Subaru found out who its customers were and focused its efforts on making cars that appealed to them.

Customers love their ugly-duckling-turned-swan because the brand stays true to the values they believe in. Subaru’s customers care about safety, an active lifestyle, community, and value and these are the core characteristics of the brand. Subaru's are consistently named among the safest cars on the road by Consumer Reports. And just as it blazed a trail by making all-wheel-drive a standard feature across most of its models, Subaru keeps coming up with new and better features to enjoy its cars in the great outdoors. Finally, Subaru gives back to the community with charitable causes that help the environment and the community.

Never one to sit back and rest on its laurels, Subaru continues to improve and grow in changing times. Fossil fuels are polluting the environment at ever-growing rates and the need for cars that run greener and cleaner is clear. Subaru is partnering with Toyota to develop the next generation of electric vehicles. Subaru continues to partner with organizations that prioritize recycling and caring for vulnerable members of our society, both locally and globally. Subaru takes its commitment to its customers and the planet seriously and will continue to make cars that are fun, affordable, and socially responsible.

Rafferty Subaru has been selling Subarus for more than 40 of Subaru’s 50+ years in America. At Rafferty, we embrace the core values of the Subaru name and show our appreciation for our customers with unparalleled customer service. Contact us to set up a test drive of a new or used Subaru today!