Subaru sales slump by 20% due to Japan quake

Subaru sales in the Middle East have declined 20 per cent in the past six months after the earthquake in Japan disrupted production of car parts for the brand, a senior company manager told Gulf News. Exports slowed after the massive earthquake and tsunami in March, but production has picked up in the last quarter of the year, said Yasushi Nagae, general manager of sales marketing, Middle East and Africa, at Fuji Heavy Industries, manufacturer of Subaru automobiles. "After October we began increasing production capacity. Now we are at an average production level. Perhaps next year we will have better figures in terms of sales for the Middle East and Asia." Another challenge for the manufacturer is the current yen to dollar value. "The exchange rate is not very favourable at this stage for any Japanese producer; we have to live with that and look for a way out. The new Subaru XV is very promising for us," said Nayyar Zaidi, general manager of marketing and sales at Al Khoory Automobiles, distributors of Subaru vehicles in Dubai and the northern emirates. Article continues below Al Khoory invested Dh45 million in a new Subaru showroom in Sharjah, it announced yesterday. The launch is part of its wider plans to expand into the northern emirates beginning with a showroom in Ras Al Khaimah next year, said Zaidi. "We want to expand sales. The Dubai market has its limitations. People living in Sharjah find it hard to drive to Dubai for service, so we need to be there strategically," he said in a phone interview. "We hope to grow by 40 per cent in the first year." Niche brand Commenting on the opening of a new showroom when new car loan regulations have curtailed car purchases, Zaidi said: "However the situation may be, we need to improve our sales volume. The only way of doing it is to open a showroom and supply spare parts. We are a niche brand, we don't talk volume, we have a lot of potential." The GCC and Middle East makes up less than 10 per cent of Subaru's sales, according to Nagae. The UAE ranks third among their top market in the region after Saudi Arabia and Oman. The brand has grown by 40 per cent in the UAE from 2010 to 2011, said Zaidi. Globally, half of Subaru's sales are in the US, followed by China, Australia, Canada, Russia and Germany, Nagae said.