Why New Subaru Forester And Outback High Customer Loyalty Rate Could Drop
A high percentage of 2021 Subaru Forester and 2022 Outback customers are return customers trading in a Subaru vehicle. Auto brand analysis reveals Subaru customer loyalty rates have been the highest among all mainstream car brands, but that could change. With the inventory shortages and lack of new Forester and Outback models to sell, some customers could defect.
A recent study from IHS Markit revealed Subaru of America had the third most loyal customers of all mainstream car brands. In quarter one in 2021, the top five leaders in brand loyalty are Ford, Toyota, Subaru, Chevrolet, and Honda.
photo credit: Patrick Subaru
But things have changed in quarter two. According to further analysis from IHS Markit, brand loyalty among U.S. consumers for new vehicles dropped to a six-year low in June. Research of new vehicle registration data through June indicates that the overall brand loyalty rate of 51 percent in the U.S. market is the lowest since August 2015 due to low inventory levels.
A recent survey by Naked Lime, a marketing company owned by Reynolds and Reynolds, found Subaru now has the fourth-best customer loyalty rate among mainstream brands at 48.5 percent. That is down from IHS Markit's number three ranking earlier in the year that showed they were retaining 59 percent of its owners. Analysts say inventory shortages have hurt Subaru.
photo credit: Competition Subaru
Tom Libby, associate director of loyalty and industry analysis at IHS Markit, says, "Obviously a major risk is that due to lack of inventory, a brand's existing owners now are more likely to defect to another brand than they have been in quite a while."
Subaru has the lowest inventory of any automaker at six days at the end of July. 2021 Subaru Forester, Crosstrek, and Outback models have been struck with the global microchip shortage. Some Subaru shoppers may have to defect to another car brand. Subaru is not alone.
The Naked Lime survey says Toyota has the highest retention rate at 60.2 percent, followed by Honda (51.2 percent), Ram (50.4 percent), Subaru (48.5 percent), and Ford (45.9 percent) to round out the top five mainstream automakers.
IHS Markit analysis indicates year-over-year, new vehicle brand loyalty in the U.S. fell by 1.7 percentage points to 51 percent in June (vs. June 2020). This follows a 2.5 percentage drop year-over-year in May and a 2.8 percent decline in April. The aggregated three-month brand loyalty in 2021 was 51.6 percent, down from 54 percent a year ago and 54.1 percent two years ago.
Subaru is not alone as buyers defect to other brands. Now, the Camden, N.J. automaker is more susceptible to customer defection due to its low inventory levels of 2021 Subaru Forester and 2022 Subaru Outback models.
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Denis Flierl has invested over 30 years in the automotive industry in a consulting role working with every major car brand. He is an accredited member of the Rocky Mountain Automotive Press. Check out Subaru Report where he covers all of the Japanese automaker's models. More stories can be found on the Torque News Subaru page. Follow Denis on Facebook, Twitter, and Instagram.
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