TORONTO -

A familiar pair of Japanese brands has taken top honors in ALG’s fourth annual Canadian Residual Awards yet again, but as ALG Canada regional director Geoff Helby told Auto Remarketing Canada this morning, the gap is closing dramatically.

Subaru won the mainstream award for the third consecutive time, while Infiniti kept its undefeated streak alive, winning for the fourth straight year. Infiniti retained 45.2 percent of its original value, while the luxury segment’s average retention was 41.5 percent. Subaru’s residual was 40.8 percent, compared to the mainstream average of 33.7 percent.

But other brands are certainly nipping at their heels, Helby said.

“The horse race is getting much, much tighter,” he told Auto Remarketing Canada, referring to their close margins of victory. “The competition is getting stiffer and stiffer. It’s going to be a supreme challenge for both of those brands to continue with this sort of success.”

On the luxury side, Infiniti is feeling some pressure from Audi, which placed second for luxury brands. Meanwhile, Helby touted “traditional strong powerhouses” like Honda (No. 3 for mainstream) and Toyota (No. 4).

So what would it take for one of these close-behind brands to steal the top spot?

“It’s no longer a product quality issue, that’s for sure. Design and styling is going to be paramount,” Helby said. “That obviously has to be backed up with the quality and reliability. But let’s face it, whether it’s Canada or the United States, a vehicle purchase is still an emotional purchase.

“And then on top of that, having that very strong marketing message” is key, Helby shared.

Japanese brands, in general, dominated the individual vehicle category awards once again, as well. They claimed 14 of the 19 honors.

Subaru notched three segment wins, as did Toyota. Mazda, Honda, Nissan and Infiniti each earned two segment awards.

The remaining five segments were won by European brands (Volkswagen, BMW, Mercedes-Benz, Audi and Land Rover), each of which were honored once.

“The domestic brands certainly are stepping up, but unfortunately they’ve been challenged by the classic overcapacity,” Helby said. “When that starts, then you have to find the outlet; whether that’s through fleet sales, daily rental or through incentives.”

When asked how close domestics are to overcoming these challenges, Helby said: “It’s already started. It starts with product.” He then noted the product upgrades each of the Big 3 has made in recent years.

ALG’s list of winners in the 2012 Canadian Residual Value Awards is as follows:

Mainstream Brand: Subaru
Luxury Brand: Infiniti

Mainstream Segment Award Recipients
Sub Compact Car: Mazda2
Compact Car: Subaru Impreza
Midsize Car: Toyota Camry
Full-size Car: Nissan Maxima
Sporty Car: Subaru WRX/WRX STI
Alt-Fuel: Volkswagen Golf TDI
MPV :Honda Odyssey
Compact Utility: Honda CR-V
Midsize: Utility: Subaru Outback
Full-size Utility: Mazda CX-9
Midsize Pickup: Toyota Tacoma
Full-size Pickup: Toyota Tundra

Luxury Segment Award Recipients
Near Luxury Car: BMW 1 Series
Luxury Car: Mercedes-Benz CLS-Class
Luxury Sports Car: Nissan GT-R
Luxury Alt-Fuel: Audi A3 TDI
Luxury Compact Utility: Infiniti EX35
Luxury Midsize Utility: Land Rover Ranger Rover Sport
Luxury Full-size Utility: Infiniti QX56

The brand rankings were as follows:

Mainstream
1. Subaru
2. Mazda
3. Honda
4. Toyota
5. Volkswagen
6. Nissan
7. Hyundai
8. Kia

Luxury
1. Infiniti
2. Audi
3. Acura
4. BMW
5. Porsche

ALG explained that it only ranks brands who scored above the industry average.