Subaru pushing more gas mileage; Japanese import rules out diesels

Subaru, that fast-climbing import from Japan, is snubbing the diesel for much-improved versions of the pistion engine to meet the demand for ever-higher mileage in the 1980s.

Indeed, the 1981 model four-wheel-drive Subaru will have about a 20 percent improvement in fuel economy, according to Harvey Lamm, president of Subaru of America Inc., an American-owned marketing company that just happens to buy its vehicles in Japan.

"The 1981 model four-wheel-drive will also have as good performance as any other four-wheel-drive on the market, better roadability, and a quieter ride," adds the man who just returned from a week-long visit to the manufacturer, Fuji Heavy Industries in Japan.

The conventional two-wheel-drive cars also will snub the diesel for much-higher-mileage gasoline-fueled engines in the years ahead, even though Fuji now has prototype diesels on the road for evaluation in Japan.

"We just don't think the technology is here to make a diesel conform to the emissions demands of the federal government," Mr. Lamm says.

"Our main focus," he observes, "is a gasoline-engine car that will give the same fuel economy as a diesel but at half the price."

In cold figures, the Subaru management is talking about a car that will give 40 miles per gallon in the city and up to 60 on the highway.By contrast, for 1981 its highest-mileage car gets somewhere around 30 in the city and 40-plus on the highway.

Have you driven it? we asked Mr. Lamm. "I might have," he replied.

The new high-mileage car is expected to be on the road by 1983 or 1984.

Meanwhile, Mr. Lamm concedes that the Subaru is far from the best looking car on the road. Still, he adds: "I feel there is nothing objectionable about the staying today." Nonetheless, the Fuji designers competitors, such as Toyota, Nissan, and Honda.

Up to now the Subaru styling has been too much of a compromise for the average American consumer. No more than 10 percent of all American car buyers even consider a Subaru, it is believed.

(The National Highway Traffic Safety Administration earlier this month reported that a Subaru GLF failed to protect its passengers adequately in a 35 -mile-an-hour crash against a solid barrier.)

Like American Motors' "policy of difference" in the vehicles it sells, including the Jeep, more than half of all the Subaru vehicles are four-wheel-drives.

This year Subaru of America Inc, will sell about 140,000 cars in the United States, up from 122,000 in 1979. Toyota and Nissan (Datsun) sell far more cars. So do Honda and even Mitsubishi, maker of the Dodge Colt and other nameplates put out through the Chrysler Corporation.

But Subaru is different in several ways from its Japanese competitors. For one thing, the US importer is not a subsidiary of hte parent company in Japan, nor are the vehicles sold through US manufacturers.

Chrysler, for example, owns a piece of the automotive arm of the huge Mitsubishi conglomerate and imports cars for sale by the Dodge and Plymouth divisions. General Motors markets the Luv minitruck through its Chevrolet division, while Ford sells the Courier minitruck. Both own part of the Japanese manufacturers, GM of Isuzu and Ford of Toyo Kogyo, maker of the Mazda.

Subaru of America, on the other hand, is an American-owned entity which has a contract to buy vehicles from Fuji in Japan.

Thus, despite all the furor over Japanese vehicle imports to the US, the Subaru management feels it is not a party to the criticism.

"Fuji doesn't have the latitude to cut back on sales in the US even if it wanted to do so," Mr. Lamm declares. "Our company has stockholders just as GM," he adds.

Fuji builds about 450,000 vehicles a year, including smaller vehicles that are not shipped to the US.

"The only difference between Subaru in the US and General Motors is that one is in the manufacturing business and the other is not," he asserts.

Indeed, the domestic car companies are importing a lot of vehicle themselves, including 30 to 40 percent of all their cars from Canada.

Subaru, along with several other Japanese companies, is studying the feasibility of building cars in the US. Honda will be building cars in Ohio within two years, while Datsun will be producing light trucks at a US site yet to be chosen. Toyota, despite all the recent speculation about a deal with Ford Motor Company, still is not committed to a US assembly plant.

If Subaru sales in the US hit 200,000 within the next several years, in accordance with the current game plan, then the company may be ripe for a US assembly plant itself.