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What's Driving Subaru's American Sales Surge?

Source: Subaru.

Part of Subaru's success is simply that it has stuck by what it does best. Subaru doesn't try to capture every buyer. It hasn't pushed into luxury cars, it hasn't tried to take on Detroit with pickup trucks, it doesn't make an SUV for every purpose.

Instead, it sticks to a few market niches that it knows well, and focuses on offering good value for money -- while refining its products to keep them competitive over time.

That has paid off in more ways than one: Subaru's reliability ratings are regularly near the top of the industry's -- and its owner-satisfaction ratings are also high.

Meanwhile, profits have been strong. Subaru's net income in the quarter ended June 30 was 52.5 billion yen (about $488 million), up 7.8%. Subaru's global net sales were 593.4 billion yen, and operating income was 78.7 billion yen.

Subaru's 13.2% operating profit margin is extremely strong for a mass-market carmaker -- compare to Ford's 11.6% margin in North America last quarter.

There's no doubt that favorable dollar-to-yen exchange rates have helped boost Subaru's bottom line, just as they've helped Toyota and the other Japan-based automakers.

But having good products in the hottest segments of the market has helped much more.

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The article What's Driving Subaru's American Sales Surge? originally appeared on Fool.com.

John Rosevear owns shares of Ford and General Motors. The Motley Fool recommends Ford, General Motors, and Tesla Motors. The Motley Fool owns shares of Ford and Tesla Motors. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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