Death of Buick?

[G. David Felt]

Recently, I have had many conversations with coworkers as well as family and friends with one large consistent thread, if possible, at all rates, they will not buy Chinese made products anymore. Japanese and Korean are fine, but a strong shift away from Chinese made products.

The leading example of this is my sister who owns a 2017 Buick Envision and drives it daily for around 200 to 300 miles as she is an in-home care nurse for open wounds. As such she needs a solid auto and of course hers is well over 100,000 miles now, so she has started the search to figure out what she wants next and has told me she loves her Buick but will not buy another since they are Chinese made and not American made.

Same with consumer home products such as cookware, I am seeing a large increase from this same group in buying American made even when it is more expensive over cheap Chinese made products. An example is the many family and friends that have decided to go back to heavier cookware made by Smithey.

Smithey Ironware Company | Premium Cast Iron Cookware

So this brings us back to the main focus on this opinion, Is Buick a Dying Brand that will cease to exist in the U.S.?

We have already seen the death of standalone dealerships as GMC and Buick merged, they pretty much have clone copies of autos in the same segments. Is there any real reason to keep Buick alive in the U.S. with the following sales numbers?

Buick Sales Story that I pulled these numbers from:

Would it be a better use of GM funds to close up Buick and direct those sales, R&D dollars, Marketing dollars, etc. to GMC, Chevrolet and Cadillac?

My personal take is Yes, time to kill off Buick and focus on the GM family of Entry level Chevrolet, Mid Level GMC and Luxury Level Cadillac.

Sound off and tell me what you think!

[Drew Dowdell]

How can you look at at 47% quarter increase and a 68% YTD increase and come out with the idea that Buick needs to close?

1. They won't close Buick because it being a US brand makes it a status symbol in China.

2. The R&D for Buick is cheap. Take a Chevy they're already building, give it curvier sheet metal which is easy to do with computers these days, nicer leather, laminate the windows, and add active noise cancellation, and they can mark it up $5k.

3. It's likely that any of the EV Buicks will end up being built in the US due to the way the tax incentives for EVs works, so for EVs at least, the China question becomes moot.

The only point I'd cede on this is that the Envision should probably be built in the US. It is a platform mate to the US-built Cadillac XT4 and they share engines and transmissions. Since the XT4 isn't exactly lighting up the sales charts, they could probably use the spare capacity to Kansas City to build Envisions, even if the sheetmetal gets stamped in China and shipped over.

[ccap41]

1 hour ago, David said:

she loves her Buick but will not buy another since they are Chinese made and not American made.

Isn't hers the only Chinese built Buick? Why'd she buy it in the first place if she is opposed to a Chinese built vehicle? 

1 hour ago, David said:

R&D dollars

There's like $15.00 allocated to Buick R&D. They're reskinned Chevys BUT, they probably have much better margins because they play up in the entry luxury field. 

[G. David Felt]

1 hour ago, Drew Dowdell said:

How can you look at at 47% quarter increase and a 68% YTD increase and come out with the idea that Buick needs to close?

1. They won't close Buick because it being a US brand makes it a status symbol in China.

2. The R&D for Buick is cheap. Take a Chevy they're already building, give it curvier sheet metal which is easy to do with computers these days, nicer leather, laminate the windows, and add active noise cancellation, and they can mark it up $5k.

3. It's likely that any of the EV Buicks will end up being built in the US due to the way the tax incentives for EVs works, so for EVs at least, the China question becomes moot.

The only point I'd cede on this is that the Envision should probably be built in the US. It is a platform mate to the US-built Cadillac XT4 and they share engines and transmissions. Since the XT4 isn't exactly lighting up the sales charts, they could probably use the spare capacity to Kansas City to build Envisions, even if the sheetmetal gets stamped in China and shipped over.

I can see your points you make, but the Sales increase is still a small number of actual units sold here.

Yes, the EVs built here will be a win for Buick for sure.

Agree that they should have been doing the building of the Envision along with the XT4 here all along.

Yet with that said, is the small number of units sold really making a decent profit for GM that would justify them keeping the product line being built and sold here?

I have to wonder about that considering how GM has in the past stretched themselves thin over too many name plates.

[Drew Dowdell]

12 minutes ago, ccap41 said:

Isn't hers the only Chinese built Buick? Why'd she buy it in the first place if she is opposed to a Chinese built vehicle? 

There's like $15.00 allocated to Buick R&D. They're reskinned Chevys BUT, they probably have much better margins because they play up in the entry luxury field. 

Only the Enclave is US build. Envision, Encore GX, and Envista are China built.  OG Encore is out of production but was S. Korea built.

But also @David: There are 4+ Buicks sold in China for every one Buick sold in the US.  They do that by being an American brand and having that image.  They get to sell a million + Buicks in China because of the image. So losing that image by closing in the US would cost more than any expense in keeping Buick alive here for 150k cars a year.

That, and I think the Envista is going to sell like gangbusters. It will appeal to economy car / kia soul drivers who want something a little nicer.

[G. David Felt]

17 minutes ago, ccap41 said:

Isn't hers the only Chinese built Buick? Why'd she buy it in the first place if she is opposed to a Chinese built vehicle? 

There's like $15.00 allocated to Buick R&D. They're reskinned Chevys BUT, they probably have much better margins because they play up in the entry luxury field. 

In 2016 buying a 2017 model year, the whole Chinese thing was not an issue for people then.

R&D is still R&D if it can make a stronger brand even stronger, then why not kill off Buick. GM, Ford, Etc. so many have killed off cars due to not selling 100,000 or more units, so why keep Buick when it sells so little. Put the money into Cadillac, Chevrolet, GMC.

2 minutes ago, Drew Dowdell said:

But also @David: There are 4+ Buicks sold in China for every one Buick sold in the US.  They do that by being an American brand and having that image.  They get to sell a million + Buicks in China because of the image. So losing that image by closing in the US would cost more than any expense in keeping Buick alive here for 150k cars a year.

That, and I think the Envista is going to sell like gangbusters. It will appeal to economy car / kia soul drivers who want something a little nicer.

It will be interesting to watch as relations between China and the US change if people there still want to buy a US auto. I see and understand the point of those that want a foreign car, but it will be interesting to see how this plays out.

[Drew Dowdell]

8 minutes ago, David said:

I can see your points you make, but the Sales increase is still a small number of actual units sold here.

Yes, the EVs built here will be a win for Buick for sure.

Agree that they should have been doing the building of the Envision along with the XT4 here all along.

Yet with that said, is the small number of units sold really making a decent profit for GM that would justify them keeping the product line being built and sold here?

I have to wonder about that considering how GM has in the past stretched themselves thin over too many name plates.

It costs them literally nothing extra to stick some Envisions they're already building on a boat. The shipping is built into the MSRP and destination charge.  They've gotta keep building them for China, so there's no harm in sending a few over here, plus it gives GMC dealers a few vehicles to cover price points below the Terrain, which is now $29,900.

6 minutes ago, David said:

R&D is still R&D if it can make a stronger brand even stronger, then why not kill off Buick. GM, Ford, Etc. so many have killed off cars due to not selling 100,000 or more units, so why keep Buick when it sells so little. Put the money into Cadillac, Chevrolet, GMC.

Because that isn't the case.  They are selling over a million a year in China. Tossing a couple thousand on a boat twice a week doesn't cost anything.

Ford killed off the Fusion for dumb reasons, but one of those was that there were far too many product option. The Fusion had 4 different engines, 2 hybrids, FWD or AWD.  And they weren't getting volume advantages by building them all in one plant. The Euro Fusions were built in Europe. The US Fusions in North America. The China Fusions in China.

The Buicks have one or two engine options each and each model is built in one plant for the whole globe.

[ccap41]

1 hour ago, Drew Dowdell said:

Only the Enclave is US build. Envision, Encore GX, and Envista are China built.

Really?? Dang, what did this happen? I must have missed or forgotten that news. That's

 

1 hour ago, David said:

In 2016 buying a 2017 model year, the whole Chinese thing was not an issue for people then.

It's kind of always been a thing. It was a huge thing when Buick made the announcement.

 

1 hour ago, David said:

R&D is still R&D if it can make a stronger brand even stronger, then why not kill off Buick. GM, Ford, Etc. so many have killed off cars due to not selling 100,000 or more units, so why keep Buick when it sells so little. Put the money into Cadillac, Chevrolet, GMC.

Becuase the VERY little R&D is easily paid for with the entry luxe brand markups. They're selling Chevys +5-10k. Why would they get rid of that? . 

[smk4565]

1 hour ago, Drew Dowdell said:

Only the Enclave is US build. Envision, Encore GX, and Envista are China built.  OG Encore is out of production but was S. Korea built.

But also @David: There are 4+ Buicks sold in China for every one Buick sold in the US.  They do that by being an American brand and having that image.  They get to sell a million + Buicks in China because of the image. So losing that image by closing in the US would cost more than any expense in keeping Buick alive here for 150k cars a year.

That, and I think the Envista is going to sell like gangbusters. It will appeal to economy car / kia soul drivers who want something a little nicer.

They used to sell 1 million Buicks in China.  In 2022 it was 677,000 down 18% and this year they are down 16% and sold 242,000 in the first half of the year, assume the second half is stronger and they hit 500k.  Which GM in general has been down in China due to the all the new EV's and the price warfare over there.  

And Tesla has sold 624,000 units in China through August, they has 84,000 in August, if they hit 80,000 each month the rest of the year they are at 1 million units in China, and they don't even have the low cost car yet that can probably sell triple what the more expensive Model 3/Y are selling.

If Buick can be a player in China, it probably makes sense to keep them, but they could be in trouble over there, and if that is the case, they are useless as a brand to GM.

[smk4565]

Couple ways to look at this, I did just read a news story about how Chinese imports to the USA are down to 15 or 16% of all imports which is the lowest it has been in 30 years or something, I forget the exact numbers, but point is, people are moving away from made in China and companies are moving away from manufacturing in China with the government doing whatever they are doing to manipulate things, covid shut downs, long shipping times, it makes the supply chain unreliable.  And Mexico and Vietnam are actually the biggest gainers and are sending more goods to the US. 

So if Buick sales are declining in China, and people in the USA don't want Chinese built Buicks, then I can see reason to dump the brand.  GM could easily rebadge the Envista and Encore GX into GMC's that are smaller/cheaper than the Terrain or the Envista could be the new Chevy Monte Carlo Crossover coupe.  They can merge those models into Chevy and GMC easily and not lose much overall volume.  

If they are selling in China and it is profitable to have Buick in the USA then I would keep them around another 10 years and then maybe Buick will have runs its course.

Final point, is the EV disruption.  First off is Tesla is going to put maybe half the car brands available now out of business, between the EV side and self driving side, and they are pretty close to solving self driving, then you need less cars on the road, more fleet/robotaxi comes in to play.  Some of these other companies are way behind.  So in a fierce market like that, GM has to pump as many resources as possible into Chevy/Cadillac.

The other aspect of the EV revolution is no longer do you need to buy the V8 luxury car to get refinement, power, good NVH, strong acceleration etc.  in the ICE age, you had to buy the Cadillac DTS, Lexus LS, etc if you wanted the V8, because they couldn't fit a V8 into a Cadillac ATS or a Lexus ES or the smaller cars.  You had to buy a V8 Mustang or Corvette if you want fast car, which were smaller cars but with big hoods, small interior.  But with an EV you can put 500 hp into a Honda Civic size car and have the smoothness and NVH  refinement of a Rolls-Royce and the acceleration of a sports car and for not a lot of money.  So no longer is the Cadillac the faster, quieter, more refined car than a Buick which is better than a Chevy, it all becomes the same.  The Equinox EV could be more quite, better NVH, and faster acceleration than a V8 Escalade and do it at 1/3 the price.  So what is the point of Buick?  The only differentiator on cars becomes the exterior style (which won't vary a ton since they will optimize for wind tunnel) and the interior materials.  

[oldshurst442]

Ill just regurgitate the usual since the announcement of Oldsmobile being phased out back in 2000.  

Why Oldsmobile and NOT phoquing Buick?    Yes. I know the reason.  

I still hold THAT sentiment.  

With that being said.  When Buick gets its (EV) models in order and available for sale (here in the Canada and in the US), maybe Buick wont be so pathetic like it has been for ohhh....I dunno, since the 1990s.  

They had an upswing there in 2010 or so (maybe later as in 2015 there)abouts when the they had some models for sale and they were actually selling.   Both sedans and CUVs.  But then their sedan sales went down the loo and their CUVs were not enticing and we are back here again when Oldsmobile died and Buick had NOTHING to sell.  

*SIGH*

Im almost upset of myself for clicking on this thread.

Kinda hopefull with the title being true and kinda sad that it aint so.  But kinda relieved that its just a kinda click baity title.   

I wont be happy if Buick ever goes away.  But I will BE kinda happy if they do if they continue being as sad as they are. 

I want Buick to be Buick again.  This, what we have, in North America is NOT Buick.

I want THE Buick that China has. Obviously not the Chinese styling. But the quality and image.  Hopefully Buicks EVs in North America will recapture the essence of what Buick was in the 1960s...  

 

[trinacriabob]

@oldshurst442

Yes, I also wonder why on the Olds-Buick decision?  Olds was righting the ship with the Aurora, the Intrigue, and even the Alero.  It could have been an issue with the name and long-term associations.  Marketing research was also scratching their heads in the background.

I'll say here that, of their offerings, I only like the Envision, and I'm talking about the last model and not the current one.  I was driving down the interstate for a fairly long time and had all of the Buick trio come up alongside me.  Enclave?  The current one has nicer sheet metal, with the last one being too bulbous. Still, I would not own one.  Encore?  I've never warmed up to it, even the slightly larger one.  Envision?  The last-gen drove alongside me and I looked and looked and thought it has the most "reasonable" lines.  I am not a big fan of the current one.

Then, it goes without saying that some Buick owners are not happy that there are no sedan offerings, let alone coupe offerings.  The Chinese appear to be getting some, which wax and wane in how good they look.  I don't know where the disgruntled long-term Buick owner is going if they're not buying.

For now, Buick needs to stay and it probably will for a while.  But I'm not the one doing the penciling.