How Sweet it is!
An age-old battle for Buick
June 15, 2007
The 2008 Buick Enclave with 20-inch wheel.
CHICAGO - When General Motors announced plans three years ago to revive its Buick brand with a string of new models aimed at younger buyers, it was to reduce the average owner's age of 63, among the oldest in the industry.
Today, the average Buick buyer is 65, according to the Power Information Network, the data-gathering unit of J.D. Power and Associates. That is the oldest and 19 years senior to the industry average.
Its image as a geriatric brand continues to haunt Buick despite years of fighting against it.
In the 1980s, for example, Buick offered turbochargers on several models to seem racier. The company also has adopted golfer Tiger Woods as a pitchman and the hip-sounding advertising tag line of "It's all good," all to no avail.
"Buick is the only brand in the industry with an average age in the 60s. Even Lincoln and Jaguar are in the 50s," said Power analyst Tom Libby.
Two of Buick's three current models, the Lucerne and LaCrosse sedans, were supposed to be part of the youth movement, but Power lists the average buyer ages at 68 and 69, respectively.
Libby points out that means a sizable number of Buick buyers are in their 70s or older. "If the average age of LaCrosse buyers is 69, that means for every 65-year-old that buys one, a 73-year-old buys one," he said.
That is a double whammy because it not only reinforces the seniors-on-wheels image but also places the customer base with owners who won't buy many more new cars.
Even Woods, 31, the company's spokesman since 1999, hasn't moved younger people.
"How many people the age of Tiger Woods consider a LaCrosse or Lucerne?" asked Global Insight analyst Catherine Madden.
One thing Buick does have, however, is a new general manager to wrestle with the age problem. Jim Bunnell took over May 11 after John Larson resigned to become chief executive of radar-detector company Escort Inc.
Bunnell also is in charge of the Pontiac and GMC brands, which GM is combining with Buick into single dealerships, a strategy he says will eliminate overlapping lineups and boost dealer profits.
Putting all three brands under the same roof also will bring a wider range of shoppers into the showroom, including coveted younger ones. Pontiac and GMC buyers average 46, same as the industry, Power data show.
Bunnell also points to the newest Buick model, the Enclave crossover that went on sale recently, as an example of how the right product can be a youth tonic. Power says early buyers of the Enclave average 55.
The Buick Rainier and Rendezvous sport-utility vehicles also drew a marginally younger crowd before being discontinued as part of GM's product overhaul.
"We see the same happening with the Enclave crossover, buyers in their early 40s and 50s that are much younger than the traditional (Buick) buyer," he said.
That doesn't mean Buick intends to scrap its traditional sedans in search of the Fountain of Youth.
"At the same time, I'm still happy to sell Lucerne to a 65-year-old or 70-year-old buyer because we still have a lot of loyal buyers," Bunnell said.
But analyst Erich Merkle of industry forecaster IRN Inc. says it will take more than Enclave to reverse Buick's aging process.
He says Buick needs to ditch features aimed at traditional buyers, such as the front-bench seat in the Lucerne, and roll out a sporty car like the Chrysler 300 to lure younger buyers.
"There's no reason Buick can't have a showpiece like that in their lineup." Merkle said. "It would be a car that would change the image of the brand, a car that would speak volumes for the brand without having to say a word."
Buick does have more fresh metal coming. This summer it adds performance versions of the Lucerne and LaCrosse. Though Bunnell wouldn't confirm it, analysts expect GM to add at least one model to the lineup and overhaul the LaCrosse and Lucerne.
Global Insight forecasts that a smaller crossover, a version of the Saturn Vue, will arrive in 2008. In 2009, the LaCrosse is expected to be redesigned and renamed Regal, bringing back a popular nameplate. The front-wheel-drive Lucerne could be replaced by a larger rear-drive sedan in 2010, perhaps as the Riviera.
Such a sedan would fulfill a promise GM made in 2004, along with a convertible.
GM did show such a sedan, Park Avenue, recently in China, where Buick commands the prestige it used to have in the U.S. - a step below Cadillac in GM's hierarchy. But GM says Park Avenue is not intended for the U.S.
China is a shining light for Buick, where it is among the most popular brands and sold 303,000 there last year, topping U.S. sales for the first time.
In the U.S., sales dwindled to 240,657 last year and are down 31 percent this year, relegating Buick to 23rd place among brands, behind niche marketer Subaru. That is a far cry from 1984, when Buick sold 941,000 and was among the Top 5 with talk of reaching 1 million in sales.
Bunnell ascribes most of this year's decline to discontinued models and a planned reduction at GM of low-profit sales to daily rental companies. The latter also has hurt Pontiac, which is off 20 percent through April.
Bunnell says GM's plan is to have "fewer but well-executed Buick and Pontiac models and not play in questionable segments like mini-vans and have product overlap between the two divisions."
That could crimp sales at both, but Bunnell said combining Buick, Pontiac and GMC into single showrooms will lessen the need for each brand to prop up sales with incentives to retail buyers or discounts to rental companies to justify their existence.
Under GM's plan, Pontiac will streamline to a smaller lineup of sporty, rear-drive cars, GMC will remain a truck and SUV brand and Buick will be the premium brand.
GM says it has 1,650 Buick-Pontiac-GMC stores that generate about 70 percent of sales for the three brands and expects further consolidation will make it 80 percent by year-end.
There are about 100 standalone Buick dealerships and slightly fewer Pontiac stores.
McClatchy-Tribune Information Services
