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In Support of The Buick
Kate McLeod
Sunday, April 22, 2007
Doing a lot right
www.thecarconnection.com
The Buick division is doing a lot right. They brought their median age down to 53 from around 67 by offering models that have now been killed. The lower median age is positive but most marketers (other than pharmaceutical companies) look at 53-year-olds as dead. I guess they don't want to be caught selling to older consumers with paid-off mortgages and money in the bank.
Yet, 40 percent of Buick's customers, according to J.D. Power PIN data, paid cash for their Buicks in 2006. Okay, maybe you don't get to make money on their loans, but you also don't have to deal with defaults. Buick ranks as the highest domestic brand, and third in the industry behind Porsche and MINI, for customers who paid cash. MetLife demographic data says there are more than 77 million baby boomers whose annual spending power is $1 trillion. They could buy a lot more Buicks if GM would give the brand more support.
In the J.D. Power Consumer Satisfaction Index, Buick came in one point below Lexus. If I hadn't learned that from Buick people, I never would have known.
Buick is having a hard time getting the word out. I'll bet their marketing budgets for the LaCrosse and Lucerne don't touch those of Cadillac's DTS and SRX, but GM won't say. And they have been relegated to a shared showroom - Buick calls their space a slice or a channel.
Meanwhile, Automotive News reported that the number of single line stores among imports is rising. The more vehicles you sell, the more single dealerships you must have. If Buick sold 400,000 vehicles tomorrow, they would not be relegated to a slice in a GMC-Pontiac dealership. GM doesn't really believe that a young Pontiac buyer will grow into a GMC truck and then decide they need a Buick, do they?
It seems that GM has decided against killing Buick, as they did with Oldsmobile. But they don't seem to want to support it and restore it to health. Buick now doesn't have enough vehicles to merit stand-alone dealers so they've been tossed in with GMC and Pontiac in the hopes that they will have better days in some distant future. (I think one of my screenplays will win an Oscar too.)
At General Motors, brand is a big word. They are refocusing their lines and streamlining their different businesses so that every brand doesn't have to appeal to every segment of the automotive market. Of course this makes sense in the master plan, but what it does it to the Buick brand is still a question. And we have learned that GM has put a hold on its plans for a large rear-drive Cadillac, which might have rolled over into something for Buick.
Buick showed journalists their model lineup recently at the annual Buick luncheon in New York . The star in Buick's portfolio is the 2008 Buick Enclave, a crossover with the same underpinnings as the Saturn Outlook. The Enclave has the sweep and elegance of a big luxury car. It's signature waterfall grille, xenon headlamps, lush, super-quiet interior, captain's chair seating, space for seven passengers, 19-inch wheels, and 275-horsepower engine combine elegance with cool conveniences. This could be a winning combination for Buick's future.
But one Enclave and two Super Buicks cannot save Buick. What can they sell, 40,000 or 50,000? Buick was the cornerstone on which all of General Motors was built. If they can't save Buick, can they save anything?
Buick just seems to be on a shelf waiting for better days. That's life support. Will this be enough? It is hard to say.
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