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Subaru SA thaws price freeze

2007-05-15 12:40
Subaru SA will increase its prices across the board for the first time in almost seven years.

The price increase is set for 1 June when prices will be hiked by between two and three per cent across the range.

The price holding strategy was implemented in June 2000 to enable Subaru's vehicle sales to gain momentum in South Africa.

"Soon after our price holding decision was made, the world faced the consequences of the '9/11' disaster, causing currencies around the world to collapse," Subaru SA managing director Teresita van Gaalen said.

"Sticking to our price holding decision and surviving was nothing short of a miracle. We stuck to our guns in an environment where everyone else escalated retail prices significantly to offset the impact of the crisis. Subaru SA has continued to take purchase cost escalation 'on the chin' for the past six-and-a-half years, while working hard at managing costs and at the same time delivering acceptable return on investment.

"Our customers, however, have benefited from investment made in Subaruship (dealership) infrastructure and skills development programmes aimed at delivering ever-increasing levels of service excellence which have taken place over the period.

"In addition we have substantially increased the value proposition in buying a Subaru as well as introducing a 63 000km/3-year maintenance plan as a massive added value bolt-on product covering virtually everything except tyres and fuel, coupled to the 100 000km/3-year manufacturer warranty. Together, such benefits have a measurable, positive material impact on the total cost of ownership for Subaru.

"The Brand has been rewarded with average cumulative growth above 40-percent over the past four years. In this period "The true measure of the success of Subaru's price holding policy can be gauged from growth in sales of new cars. The Brand has grown at an annual rate above 40% over the past four years and in this period, Subaru dealers sold more than 70 percent of our present car parc of 7 000 vehicles in South Africa."


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