Subaru USA CEO Tom Doll Gets Specific About COVID and Post-COVID U.S. Sales Goals

Timothy Cain
by Timothy Cain
subaru usa ceo tom doll gets specific about covid and post covid u s sales goals

After a streak of 11 consecutive years of U.S. sales growth for Subaru, a period in which the brand doubled its market share to 4.1 percent, “We’ll start a new streak next year,” the brand’s U.S. CEO Tom Doll says of 2020.

At any other point in history, the declines reported by Subaru over the last few months would be calamitous. Yet Subaru’s year-over-year losses in 2020, a year torn to shreds by COVID-19, have not been as severe as anticipated. Moreover, bright spots have been more numerous than expected.

The company, as a result, is now planning for 2020 to end as the brand’s sixth-best on record.

In an interview with Automotive News, Doll was relatively transparent about Subaru’s current state of affairs and the automaker’s plans for recovery. Doll is in an unusual position in the industry – he began his tenure with Subaru in 1982, helping to craft four decades of history at one brand. Johan de Nysschen he is not. Doll has seen the company falter (fewer than 100,000 Subarus were sold in 1994 and again in 1995), he’s seen the company grow in the midst of turmoil (Subaru sales soared to a then record high in the midst of 2009’s economic collapse), and he’s seen his share of flops (Baja, Tribeca, Legacy SUS) and hits (Outback, Forester, Crosstrek).

That kind of perspective isn’t just useful in terms of Doll’s understanding of Subaru, but of the industry as a whole. It’s the kind of perspective that causes Doll to believe that government intervention would be better employed across the economy at large rather than targeting the auto industry in a Cash For Clunkers repeat.

“I think we’re probably in favor of really helping the overall economy get back,” Doll says, “because that’ll help everything: It’ll help used cars, new cars and other industries besides just autos.”

Economic prudence aside, it’s worth noting that Subaru is hardly in a position to take advantage in a Cash For Clunkers scenario. Inventory is low at Subaru — just 60 days’ supply overall and lower for some models such as the Outback, which is just the way the company likes it in normal circumstances. Given the limited stock, how much market share does Subaru potentially stand to lose if it doesn’t have the vehicles to sell during a period of artificially inflated demand? Doll doesn’t expect to see inventories rise to reasonable levels until mid-August.

Although plant shutdowns quite obviously limit inventory, the main reason Subaru was caught off guard heading into the summer was unexpectedly high demand through the spring. June, says Doll, is “going better than we thought.” That’s after March and April sales slid “just” 47 percent. Doll, who’s been the president and CEO for two years, says Subaru sold 8,000 more vehicles in April than the brand anticipated. Then in May, despite a 19-percent year-over-year decline, Subaru still sold nearly 52,000 vehicles. This comes from a brand that, up until August 2014, had never sold 50,000 vehicles in a single month, a brand that didn’t begin averaging more than 50,000 monthly sales until 2016.

No matter how good 2020 will look by the standards of not-so-ancient history, no brand that’s on an upward trajectory this steep plans for a rapid economic shutdown.

“It just came upon us so quickly that there really wasn’t much time to adjust,” Doll says, while also pointing out that the brand is in a markedly different position now compared to the recession of 11 years ago. “During these very good years we’ve had, particularly in the last five or six years, we were able to fortify our balance sheet in such a way that we can withstand this type of a situation.”

This means that Subaru, which intended to sell 725,000 vehicles in 2020 – a modest 4-percent uptick – is now targeting 575,000 vehicles, an 18-percent year-over-year decline. In the bizarre world in which the auto industry finds itself, an 18-percent downturn is actually representative of cautious optimism.

Doll and Subaru certainly have reason for optimism. The brand’s No.1 best seller, the fifth-generation Forester, generated its highest-volume month in history in May: 17,859 sales. Subaru, a brand steeped in the tradition of limiting incentives, is temporarily hooked on 0-percent financing on 63-month terms in order to curry favor with consumers. It’s an especially tantalizing offer at Subaru precisely because it’s unexpected. According to ALG, the average Subaru was discounted by $1,848 in May 2020, 60 percent less than the industry average but 21 percent higher than Subaru incentives one year earlier.

In the current environment, Subaru can excuse its own out-of-character behavior. There are headwinds the likes of which no industry veteran has ever encountered. Through those headwinds, Doll just wants to maintain a level footing.

“Our goal is to maintain our share of the market, whatever the market is.”

Whatever the market is. Surely a fitting title for 2020.

[Images: Subaru]

Timothy Cain is a contributing analyst at The Truth About Cars and and the founder and former editor of Follow on Twitter @timcaincars and Instagram.

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  • Inside Looking Out Inside Looking Out on Jun 23, 2020

    I hate Subaru. I prefer cats. Communists are dogs, capitalists are cats.

  • Lie2me Lie2me on Jun 23, 2020

    Wow, 18 comments and no mention of Subaru's flannel wearing women who love dogs customer base, now that's progress :)

    • Art Vandelay Art Vandelay on Jun 24, 2020

      Flannel is for great musicans that have all mostly gone to that great gig in the sky as a result of depression and heroin.

  • Nrd515 I bought an '88 S10 Blazer with the 4.3. We had it 4 years and put just about 48K on it with a bunch of trips to Nebraska and S. Dakota to see relatives. It had a couple of minor issues when new, a piece of trim fell off the first day, and it had a seriously big oil leak soon after we got it. The amazinly tiny starter failed at about 40K, it was fixed under some sort of secret warranty and we got a new Silverado as a loaner. Other than that, and a couple of tires that blew when I ran over some junk on the road, it was a rock. I hated the dash instrumentation, and being built like a gorilla, it was about an inch and a half too narrow for my giant shoulders, but it drove fine, and was my second most trouble free vehicle ever, only beaten by my '82 K5 Blazer, which had zero issues for nearly 50K miles. We sold the S10 to a friend, who had it over 20 years and over 400,000 miles on the original short block! It had a couple of transmissions, a couple of valve jobs, a rear end rebuild at 300K, was stolen and vandalized twice, cut open like a tin can when a diabetic truck driver passed out(We were all impressed at the lack of rust inside the rear quarters at almost 10 years old, and it just went on and on. Ziebart did a good job on that Blazer. All three of his sons learned to drive in it, and it was only sent to the boneyard when the area above the windshield had rusted to the point it was like taking a shower when it rained. He now has a Jeep that he's put a ton of money into. He says he misses the S10's reliablity a lot these days, the Jeep is in the shop a lot.
  • Jeff S Most densely populated areas have emission testing and removing catalytic converters and altering pollution devices will cause your vehicle to fail emission testing which could effect renewing license plates. In less populated areas where emission testing is not done there would probably not be any legal consequences and the converter could either be removed or gutted both without having to buy specific parts for bypassing emissions. Tampering with emission systems would make it harder to resell a vehicle but if you plan on keeping the vehicle and literally running it till the wheels fall off there is not much that can be done if there is no emission testing. I did have a cat removed on a car long before mandatory emission testing and it did get better mpgs and it ran better. Also had a cat gutted on my S-10 which was close to 20 years old which increased performance and efficiency but that was in a state that did not require emission testing just that reformulated gas be sold during the Summer months. I would probably not do it again because after market converters are not that expensive on older S-10s compared to many of the newer vehicles. On newer vehicles it can effect other systems that are related to the operating and the running of the vehicle. A little harder to defeat pollution devices on newer vehicles with all the systems run by microprocessors but if someone wants to do it they can. This law could be addressing the modified diesels that are made into coal rollers just as much as the gasoline powered vehicles with cats. You probably will still be able to buy equipment that would modify the performance of a vehicles as long as the emission equipment is not altered.
  • ToolGuy I wonder if Vin Diesel requires DEF.(Does he have issues with Sulfur in concentrations above 15ppm?)
  • ToolGuy Presented for discussion:
  • Kevin Ford can do what it's always done. Offer buyouts to retirement age employees, and transfers to operating facilities to those who aren't retirement age. Plus, the transition to electric isn't going to be a finger snap one time event. It's going to occur over a few model years. What's a more interesting question is: Where will today's youth find jobs in the auto industry given the lower employment levels?