Transitioning Buick Sees Sales Slide

[Variance]

Link: http://wardsauto.com/ar/auto_transitioning..._sees/index.htm

By Brian Corbett

WardsAuto.com, Aug 25 2005

Through July, Buick sales are trailing year-ago by 4.3%.


DETROIT – General Motors Corp.'s Buick Div., a key factor contributing to GM's declining market share over the decades, likely will post another year-over-over sales decline in 2005, the brand's third straight annual decrease in the U.S.

Buick is one of only two GM brands – the other is Saturn – on the way to posting a decline in 2005 despite the raging success of GM's “Employee Pricing for Everyone” incentive program.

Through July, Buick sales are trailing year-ago's results by 4.3%.


'06 Buick Lucerne
Margaret Brooks, Buick marketing director, says the brand will be unable to overcome that small difference during 2005's remaining five months because the LeSabre large car is being phased out and replaced by the Lucerne.

In 2004, LeSabre accounted for 114,157 units of Buick's 309,639 overall sales.

“The thing that's going to limit our potential for the balance of the year is the transition between LeSabre and Lucerne,” Brooks tells Ward's.

“We have a unique set of circumstances when we have an area of the market that represents 40% of our business. The LeSabre is going out, and frankly, it's pretty much sold out right now.

“And we won't have the Lucerne in the showroom until the end of the calendar year,” she adds. “We don't expect to see an increase this year over last year simply given product availability is not sufficient enough to let that happen, given the transition.”

However, Buick's retail sales are up 3% this year through July, Brooks says.

Reducing commercial deliveries is a company wide initiative at GM, but it's especially important at Buick, given its relatively poor residual values caused by numerous stodgy products, a lack of investment and an aging buyer demographic.

“We really are reducing the amount of business we do in the fleet market. We'll still do some fleet business in certain markets, especially when there is nothing else in GM that can do that job, like the Rendezvous (cross/utility vehicle,)” Brooks says.

“Whatever we do, we're going to do it judiciously. We did some premium fleet business with the LaCrosse (midsize sedan), and we'll do a little with Lucerne. But we're going to reduce that part of our business. It's critical to helping the resale value of our products.”

Besides the LeSabre, Buick has discontinued production since last year of the Regal and Century midsize sedans and the Park Avenue large car. During the same timeframe it has added the Terraza minivan to its lineup.

“When we launch Lucerne, when customers come in for that, what they're going to see is a totally different showroom – one that is totally different than their expectations,” says Brooks.

To urge consumers to give the brand a chance, Buick has been promoting GM's Employee Pricing for Everyone program more than any other nameplate. Buick has aired several TV commercials featuring GM employees who work on Buick products.

“When we looked at the corporate messaging for the employee pricing, we just thought there was an absolute perfect synergy and the Buick-specific messaging because Buick is really communicating sophisticated quality as the foundation upon which we're going to build this brand,” Brooks says.

“It was perfect timing. We picked up J.D. Power (Initial Quality Survey) and longer-term durability awards earlier this year.”

Buick has been awarded with huge monthly increases in June and July vs. like-2004 results – up 31.1% and 20.4%, respectively.

“One of the things we've seen during the last two months, 50% of the people who bought a LaCrosse told us that if they didn't buy a LaCrosse, their second choice was a non-GM product. So we're able to maintain buyers in the fold.”

[Mule Bakersdozen LS]

Shock! Shock! Shock! Buick's in a real predicament right now-I see a lot of LaCrosse's and increasing amount of Terazza's around here, but they're just junking their huge flowing styling potential, and that could be a major problem for Buick, along with the lack of products, namely more relevant ones to catch smaller, more-popular models so that Cadillac doesn't have to take the dive and risk their increasing 'Standard of the World' luxury status. Also, Lucerne is going to have to depend on how the CX trim looks inside and out (base models still sell the most, you know) and how the price will justify a 2006 full-size, front-drive car with a weak V-6 and a now-outdated 4-speed automatic transmission. And every LeSabre buyer had a front split-bench seat, which is now optional-not sure if it will be extra cost here or not, but if it is, I can surely bet Buick will lose more and more sales. I mean, what are the advantages here? Lucerne lost trunk space compared to the previous LeSabre and Park Avenue, now at 17.0 cubic feet. Edited August 29, 2005 by Mule Bakersdozen LS

[Paolino]

Ugh... Buick is in for a very rough ride to say the least.

[The O.C.]

Link: http://wardsauto.com/ar/auto_transitioning..._sees/index.htm

[post="5926"]<{POST_SNAPBACK}>[/post]

"PREMIUM" rentals...?

I see LaCrosses all over the Hertz lot....and I can guarantee you they are NOT part of Hertz' "Premier" rentals....they sit alongside the Taurus in the "fullsize" rental category.

Also, the article states that Buick has been the biggest advertiser for the Employee Pricing promo? Isn't it ironic that I haven't seen a SINGLE Buick ad for this promo....not a one....

Who the heck is this woman, this "Margaret Brooks?" Does she HAVE a clue? Edited August 29, 2005 by The O.C.

[Satty]

I see a lot of Chevy and Saturn employee pricing ads, even a few GMC, no Pontiac or Buick ads.

[HarleyEarl]

I was at a Pontiac/Buick/GMC dealership recently....the Buicks just sat there all very ordinary, nothing to make you walk over and take a look closer. They all look 5 years old. The Rainier is not a Buick, the Terazza is not a Buick, the Randezvous is all awkward looking. The Lucerne is not here yet. So what are you left with? Ancient LeSabres with terrible interiors and the new LaCrosse....it's ok, but ordinary. Not much to get excited about. It's all very sad really.

[Cory Wolfe]

Well that's a surprise to me... After Pontiac being the only brand to not see increases in June I figured Pontiac would surely have a decline. But no... it's [b]Buick[/i] and [b]Saturn[/i] only. I guess that's good, but is that correct? I can see Saturn having it, but not Buick, and definitely would have thought Pontiac would have been... :blink: :wacko:

Satty, I only see Chevy and Pontiac ads. Every once in a while I'll see a Saturn one, but never a GMC or Buick one. :huh:

[Paolino]

I've only seen Cadillac, Saturn, and Chevy ads for employee discounts, but NOTHING for Buick or Pontiac. There isn't even anything to get people into the dealerships at this point--the LaCrosse, although a huge step forward from the Century, is just average. The Lucerne, not there. Rainier, well, who needed it?! Sales will prove my point. Terraza? C'mon. Make the Saturn Relay have all the features/luxury the Buick one has, then drop it from the Buick lineup. Rendezvous, well, they styling has grown on me, but it's time for a change. I know, I know, it's coming, but then they're changing the name as well? Silly. It has such a strong following!

[Matt276]

At least, if only there was a 6 speed auto tranny in the Lacrosse and the 3.6L standard.

[Paolino]

At least, if only there was a 6 speed auto tranny in the Lacrosse and the 3.6L standard.

[post="6014"]<{POST_SNAPBACK}>[/post]

That better be standard for 2007.

[Satty]

I'm not sure I have ever seen a Pontiac or Buick EPP commercial. They had been running the Saturn one where people are running around the lot calling dibs on various cars a lot during July, but seem to have cooled on those in August. All of the Chevy ones I see talk about how you can get a new Silverado for like $13k, all the GMC ones are for the Yukon. It kind of makes sense for Saturn to have a decline, the L series was dropped, so thats like 20 sales a month out the window, plus '05 VUE production had to send sometime so they could make the needed changes for the '06, which seem to be slow in getting to lots. That leaves a minivan that almost nobody knows exists and a sub-par compact car.

[Northstar]

I've seen a lot of EPP commercials. The Saturn "Dibs" one, at least one GMC one where they talk about being professional grade, quite a few Chevy ones (mostly Silverado and Cobalt), Buick with the LaCrosse (waterfall one with a thing at the end about the EPP), a Saab one, and I think that's it. I've never seen one for Cadillac or Hummer. As for Buick sales sliding... well it took a while until the LaCrosse began selling at the same volume of the Century and Regal, plus add in a few lost sales from the Park Ave, LeSabre sales falling because it's so old, dismal sales from the Terraza and Rainier, and obviously they aren't having much success. With the Lucerne and Lambda X-Over, I think Buick will be ok. The premium Theta SUV could do well and really help cement Buick's future. I see it possibly becoming the RX of the Buick brand if it is well received.

[Flybrian]

Its becoming obvious someone seriously fucked up the timing of Buick's transition.

You never, ever leave a gap like the LeSabre/Lucerne, especially when it accounts for almost a whole fucking third of your sales.

“One of the things we've seen during the last two months, 50% of the people who bought a LaCrosse told us that if they didn't buy a LaCrosse, their second choice was a non-GM product.”

A non-GM product like what? A Sable?

This has me pretty livid that these people think the Rainier and a minivan would really sell. Think about how well Buick did when its lineup consisted of four sedans on two largish platforms and two of them looked nearly identical! This product infusion is a joke because the product is trite and meaningless.

[Northstar]

I think Lutz was the one that messed up the new Buick's timing, but it was probably for the better. I'm guessing we got better products because he made them re-do them for the most part, even if it took longer to get them to market.

[Flybrian]

I see two sedans and a bunch of pesudo trucks. Please, Bob, show me the improvement.

[Paolino]

I want 3 sedans, one huge, one full, one midsize. 2 Trucks, one midsize, one full. I want a coupe/convertible. That's all. Oh, and real wood.

[HarleyEarl]

It is very sad. Is it a death watch? Are we witnessing a a long slow death of another division? GM, don't do it. I always thought Pontiac would go first, but I am now thinking it might be Buick.

[Bimmer325]

Pontiac isn't going anywhere.

[Robert Hall]

You know things are in sad shape when the only full frame, V8 RWD Buick is an SUV.

Well, Buick didn't have a RWD V8 model at all for about 7 years... (last Roadmaster was '96). And isn't the Rainer AWD only (or is there a RWD version for the Sun Belt states?)


Interesting... Pontiac cut 5 models for '06, Buick 3, and GMC 2... 10 models cut from PBG for '06 and only 2 added....

[Northstar]

Pontiac cut 5 models? Aztek, Bonneville, Sunfire, and what else? Buick cut Century, Regal, Park Ave, and LeSabre. GMC cut the XUV and what else? And there were more than two added: G6 coupe, Solstice, Torrent, Lucerne.

[Robert Hall]

Pontiac cut 5 models? Aztek, Bonneville, Sunfire, and what else? Buick cut Century, Regal, Park Ave, and LeSabre. GMC cut the XUV and what else?

And there were more than two added: G6 coupe, Solstice, Torrent, Lucerne.

Pontiac cut the Aztek, Sunfire, Bonneville, and Montana (the old Montana carried over for '05 after the SV6 was added). Buick cut the Century, Park Avenue, and Le Sabre (the Regal was cut for '05). GMC cut the XUV and Safari.

I forgot the Torrent and G6 coupe... Edited August 30, 2005 by moltar

[Paolino]

Well, Buick didn't have a RWD V8 model at all for about 7 years...  (last Roadmaster was '96).  And isn't the Rainer AWD only (or is there a RWD version for the Sun Belt states?)
Interesting... Pontiac cut 5 models for '06, Buick 3,  and GMC 2... 10 models cut from PBG for '06 and only 2 added....

[post="6301"]<{POST_SNAPBACK}>[/post]

Wait... I think you've miscounted...

For 06 added will be:

- Pontiac Solstice
- Pontiac Torrent
- Buick Lucerne

And somehow, they like to count these as new vehicles:

- G6 Coupe
- G6 Convertible

Still... trimming a LOT from these divisions.

[Cory Wolfe]

I know... I hate the trimming. <_<

[VenSeattle]

Okay... to break some of this down... let's see:

1) Sales declining:

Through July, Buick sales are trailing year-ago's results by 4.3%.

but

However, Buick's retail sales are up 3% this year through July, Brooks says

This means Buick has been selling less to fleet and more to customers... hence the percentage drop in overall sales. GM announced years ago that Buick would be slowly backing off from high amounts of fleet sales. GM NEVER stated they would increase retail sales to compensate on a "1 to 1" level with fleet sales. Retail sales are more profitable to GM so this is actually GOOD NEWS.

Buick's goal right now is to increase retail sales. That will determine Buick's market viability. Buick is increasing retail sales.

Plain and simple: More individual customers have bought a LaCrosse, LeSabre, Terraza, Rendezvous, & Rainier this year than customers who bought a Regal, Century, LeSabre, Park Avenue, Rendezvous, & Rainier last year.

2) Product cuts, what does it really mean:

For 2005 Buick has disco'd 3 sedans, added 1 new sedan and 1 new minivan.

Besides the LeSabre, Buick has discontinued production since last year of the Regal and Century midsize sedans and the Park Avenue large car. During the same timeframe it has added the Terraza minivan to its lineup.

Yet, retail sales are up from 2004 and Fleet sales are down???? That's actually pretty DAMN spectacular. For those who think the Terraza is selling poorly, it's selling better than the Saturn Relay and equal to the Montana SV6 that's sharing the showroom floor with the Terraza.

The Relay doesn't even have a separate minivan to compete with in the Saturn showroom.

3) Who are buying the new Buicks?

“One of the things we've seen during the last two months, 50% of the people who bought a LaCrosse told us that if they didn't buy a LaCrosse, their second choice was a non-GM product. So we're able to maintain buyers in the fold.”

Besides the Sable joke, the fact is the LaCrosse attracted A LOT of non-GM buying customers in June and July. That's the type of penetration GM needs with Buick's new products. More retail sales to the non-traditional Buick buyer. More retail sales from customers NOT CROSS-SHOPPING OTHER GM PRODUCTS.



Yes... actually A LOT of good news in this article.

[HarleyEarl]

They are slowly backing away from fleet sales?...it doesn't seem like it. Almost every new LaCrosse I see on the street seems to have a rental company sticker on it.