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Location! Location! Location! How may times have you heard that? Well, for Subaru, location is indeed a big deal, as they are moving uptown into new premium digs. Or so they would like you to believe…

Okay, so what does premium mean? More important, how does it apply to Subaru? And even more important, what does it mean to traditional Subaru customers, who were very comfortable just “slumming it”? Go to any Subaru-related web site, or just about any forum with a discussion about Subaru, and a spirited debate of Subaru going “premium” is easy to find. Frankly, I think there’s been much confusion over the word premium, and exactly what Subaru means by using it. Most people, when they hear the word premium, think of luxury, leather and the like. I’m not so certain, however. I see the Land Rover Defender as being a premium off road vehicle, but it’s certainly not luxurious. My personal definition is that premium means being the best, or among the best, in any given market segment. That may, or may not, include luxury. I see the Honda Accord and Toyota Camry as being premium vehicles within their respective segments, same with the Civic, Corolla and some Subarus; and none of those vehicles is thought of as a luxury car.

I think one thing is for certain: Future (premium) Subarus are likely to lighten your wallet more so than in the past. There’s just something about the word premium that automatically equates to cha-ching!

As Subaru moves up (town), so does everyone else. If Subaru indeed wants to separate itself from Mazda, Honda, et al., it will need to take one and a half or two steps forward for every one step the other carmakers do. And piggybacking on that thought, Subaru has been - and continues to be - rather slow in moving forward; too slow in my opinion. They still appear to be matching - but not really exceeding - the competition each new model year. Yeah, the new Subie models are great, and much better than their predecessors; but the same can be said of Mazda, VW, Honda, and so forth. I really don’t see them moving ahead of those guys; at least not yet, as most of the ’06 models have yet to be introduced. We’ve seen the B9 Tribeca, and on a scale of 1 – 10, I see it as a solid 8.5. I was hoping for a 9.5 or 10, but that’s not the case, at least not yet. The new JDM Forester looks good, but let’s see how the US-spec models fair. Will there be a 5EAT? The JDM models didn’t get that. Will there be any other all-new, never-seen-before technology on our ’06 Forester? Or our ’06 Legacy? Or our ’06 Outback? Or our ’06 Impreza? Rumor has it that there is an updated 2.5 engine, and that the WRX will also get a 2.5 turbo. Will we see 5EATs replacing the 4EATs on all model lines? Will the rumored 6-speed manuals show up? What about the also-rumored Forester STi? Anything else? Will a navigation unit, like that introduced on the Tribeca, find its way into the rest of the lineup for 2006? If any or all of the above questions get answered affirmatively, it will go a long way towards moving Subaru - as a brand - towards “premium” status in my opinion. However, at this point there are just lots of questions, and few answers.

It now appears that Marketing “Plan B” is in place. When it was first announced that Subaru was going to market premium vehicles, there was panic and a tremendous outcry from loyal Subaru customers, fearing that Subaru was abandoning them. Well, the word apparently got through, as Subaru has recently backed off a bit and has re-tuned their marketing message by letting the vehicles speak for themselves, rather than telling people that Subaru is going to become a premium brand. If the customer doesn’t get it by seeing and/or driving the vehicle, well, they most likely will never get it… This is a wise move, I think. Most people are by nature skeptical of such boosting, and as Prez Roosevelt Numero Uno once said: “Walk softly, but carry a big stick.” It appears that Subaru is now applying that concept to their marketing and products. Good idea, and ‘bout time.

So, how’s this all sit with the so-called premium establishment? When the new Legacy debuted last year, folks were comparing it to the BMW 3 Series. Well, at least as far as performance is concerned, and in terms of the premium “perks,” the 3 Series still has the edge. Nowhere on the US-spec ’05 Legacy will you find xenon headlights, navigation system, auto-up/down window switches, 6-speed transmissions and the like. For ’06, some of those items are rumored to arrive, but as of now, they’re MIA.

And… in case you haven’t noticed, there also seems to be product realignment going on within the European premium ranks, the market in which Subaru seems to be targeting. It includes new faces on Audi and VW. BMW has been going through a visual transformation for several years now. Even Mercedes is taking styling very seriously. It’s not just looks, but also new models, such as the new Mercedes CLS, R Class, B Class, and so forth. The all-new BMW E90 3 Series has gotten a bit larger and more expensive too, I’m sure; and to boot, there’s an all-new 1 Series slotted below the vaunted 3 Series, and it’s coming Stateside. To use a transmission-like analogy, think of the outgoing BMW sedan lineup much like a wide-ratio 3-speed transmission (3 Series, 5 Series, 7 Series), and the new expanded BMW sedan lineup as more like a close-ratio 4-speed transmission (1 Series, 3 Series, 5 Series, 7 Series). So does that now mean the current Legacy is going to be pitted against the new entry-level 1 Series BMW, rather than go against the new larger, more expensive, and even more feature-laden 3 Series? With all these changes going on within the ranks, it could be a good opportunity for Subaru, in that many loyal Euro-customers may not like what they see going on with their Euro-rides, and may be more open to consider other brands - such as Subaru.

This all raises some interesting questions: Where does the Impreza fit in here in terms of BMW comparisons, as there is no BMW-Impreza equivalent? With Mercedes, the Impreza could be pitted against the A Class, but that car is not likely to be imported here. So does that mean the Impreza will go up against the new B Class, therefore leaving the Legacy to battle the C Class? And what about Audi - which in many ways is a more direct competitor to Subaru than either BMW or Mercedes? Will the Impreza match up with the new Audi A3? The A4 and the Legacy seem to be a good match, at least in terms of size and performance; but again, the current Legacy comes up a bit short on the features/content list.

Now if we can agree that the Impreza and Legacy can sort of play in the same ballpark with the lower-end Euro sport sedans, what happens when we start comparing 5 Series, E Class and the A6 with Subaru? Do we consider the B9 Tribeca? Not hardly, as that’s a crossover SUV. Subaru doesn’t yet have something in that class. Notice, I said “yet.” How much you want to bet that there will be a B9-based sedan of some sort within a few years, to match those mid-sized Euro sedans?

And it’s not just the Europeans Subaru is going to war with. The Japanese have recently really upped the ante in terms of the premium market. Lexus, Infiniti and Acura have really made some big strides in the last few years - especially Infiniti and Acura. Of those two I think Acura is perhaps the most direct competitor for Subaru.

I really think Subaru had better have a close eye on Acura. The all-new RL has a great new standard SH-AWD system, which in some ways is more advanced that anything Subaru offers. You can bet that system will eventually trickle down to all Acura cars. When that happens Subaru had better be ready to answer the challenge.

So let’s look at Acura vs. Subaru, in terms of their sedans. Again, the match ups are a bit goofy. The Legacy and TSX match up almost inch for inch, and they’re priced within earshot of one another. Right now there’s no Acura sedan equivalent for the Impreza. Also, Acura is pitting the RL against the 5 Series /E Class/A6 cars. Therefore that means Acura TL is above the Legacy, but below the others just mentioned - sort of in its own zip code… Then again, I suppose that you could say the Impreza pairs up to the TSX, and Legacy pairs up to the TL… Believe that? I don’t, perhaps with the next-generation models, but not now.

Confused? I know I am - and this is even without inviting VW, Volvo, Saab, Infiniti or Lexus to Subaru’s new neighborhood block party! I think it’s time to go grab a burger and beer - or perhaps maybe more aptly, sushi and wine, and ponder as to if there is really a God. At least that is easier to contemplate…


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