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Subaru's Impreza Geared To Slow Long Sales Slide

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SUBARU, always a minor player among the Japanese giants, is counting on a small car to help it make a big comeback.

But will the Impreza make an impression on jaded American motorists?

For years, Subaru of America was the only United States-owned Japanese import. It had a reputation as a reliable, if quirky, brand. Subaru put an emphasis on four-wheel-drive, which helped it carve out a loyal following in the snowy climes of Colorado and New England.

Back in 1986, Subaru sales hit a record 183,242, not bad when you consider the carmaker was limited to one main offering: the subcompact Loyale.

So, company officials reasoned they were in for a big growth spurt when they added a couple more product lines, first the minicompact Justy and then the compact Legacy. But things didn't work out quite as planned.

After more than a decade of steady growth, sales began to tumble. By last year volume had slipped to 104,800 units. Steady profits turned into wrenching losses. By mid-1990, Subaru of America's US owners were forced to sell to their Japanese supplier, Fuji Heavy Industries.

Industry analysts say several things went wrong. "For Subaru, the problem has been image and awareness," says Chris Cedergren, an auto analyst at the AutoPacific Group. "No one knows just how good their products are."

There were other problems. The weak dollar drove up prices. New competitors introduced their own four-wheel-drive models. But perhaps worst of all, Subaru simply failed to maintain its core products. By the end of 1992, the Loyale had been on the market for more than seven years, an eternity in a product segment where Japanese models are typically updated every three to four years.

So Subaru is counting on the Impreza to halt its fall. "It's the Impreza that will bring us back," says Ken Stanton, the company's marketing manager. "We feel we're at the bottom and with the Impreza, you'll see a significant increase in sales next year."

Initial reviews in the automotive press have been generally favorable. Critics praise the car's styling, especially the Sport Wagon. They note that the Impreza is loaded with a lot of features normally available only as options - if at all - on comparable products. But the biggest selling point may be the Impreza's price. The base model carries a sticker of $10,999. A fully loaded wagon with an automatic transmission tops out at $17,599.

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