General Motors shocked the automotive world in 2009 when as part of their bankruptcy restructuring they shut down Pontiac. Many observers noted how Pontiac’s storied past, and sport focused market niche made it likely to be successful in the future. However, GM had decided that the future of automotive was Chin,a and of course that’s turned out to be correct. In 2021 Chinese bought 50% more vehicles than Americans did and that trend will only intensify in the next decade or two. In 2008 Buick sales in China were substantial and growing so the General made the decision to kill a much loved American brand, Pontiac, in favor of keeping a future brand in the far east, Buick. But that was then and this is now.
For the year ending 2022 General Motors sold only 65,000 Buick’s in the United States. To give you an example of how small that is Stellantis Chrysler Jeep just announced that they are killing (at least temporarily) the Jeep Cherokee because it sold only 50,000 units in 2022. It is also important to remember the Cherokee is just one product while Buick has four in the United States and Canada, each with truly tiny sales volumes.
So why on earth would GM keep such a brand operational with all of its associated costs and unpleasant union contracts to deal with. There are two big reasons the general keeps Buick going. The first is the old badge engineering model. Buick’s these days don’t have different powertrains or chassis’; they are just mildly adjusted versions of Chevrolet’s and Cadillacs which keeps GM’s costs down and dealers with alternate product to upsell or down sell sensitive consumers to.
But the big reason Buick still exists is still China. In 2022 Buick sold about 550,000 vehicles in China, that is eight and a half times as many they sold in the US. So that gets to the question of why not just sell Buick’s in their only real market, China? And the answer is because Buick has an equivalency to America in China. Middle class and affluent Chinese still look at America as something to aspire to be like. If the General killed Buick in the United States, it would weigh heavily on Buick in China.
Buick sales cratered in 2022; down an nearly unbelievable 40% from 2021. So how can GM keep a failing brand like Buick alive in the United States and Canada? Well, the General has a clever solution they used to sell vehicles in secondary and tertiary countries around the globe, will also work in the United States. I’m sure most American Car buyers would be shocked to find that three of the four Buick name plates they can buy are not made in the United States and that there are 12 Buick models in China. The Encore and Encore GX (which are very different vehicles despite their names) are made in South Korea and the Buick Envision is made in China. That leaves only the Buick Enclave as a truly domestic product which is a very thinly veiled version of the Chevrolet Traverse, GMC Acadia and Cadillac CT6.
Here is the fun part of this story; Other than its visually apparent design elements and some powertrain options, the Buick Enclave sold in the United States is not the Buick Enclave sold in China. They are substantially different vehicles. Click the graphic to the right which we sourced from an excellent article from GMAuthority.com to see some of the differences.
You might think that this can’t continue for long but there are three reasons Buick will continue to sell product in the United States and Canada:
- A substantial part of the cost of a vehicle is the development cycle and when you make vehicles for other markets that you just brand for the American market while adding a few minor touches like wider seats for American bottoms and some cross members to strengthen crash resistance, Buick’s North American badge engineering becomes practical.
- General Motors Has contractual agreements to produce vehicles in other countries like South Korea and China and the only way those work is to get the volumes up through global sales.
- GM just has to hold out until EV’s completely take over a decade from now. Electric vehicles ride on a powertrain called a skateboard which includes the battery and electric motors. A Top Hat is the body and cabin that you see and it is much cheaper to produce when put on a standardized EV skateboard like the Generals Ultium battery and powertrain platform.
American and Canadian Buick lovers are almost certainly going to see offshore manufactured Buick’s continue to come to North America because it’s the only thing that makes sense for the next decade.
If I worked in a Buick only factory in the United States I would be pretty freaked out about now but there isn’t a single North American factory producing only Buick’s. As noted the only US made Buick, is the Enclave and it is produced in GM’s Lansing Delta plant Along with the Chevy Traverse which sold 100,000 copies in Canada and the United States last year.
Buick’s future is in question but we don’t see it going away, and we suspect GM is expecting it to grow when the EV revolution is in full swing a few years from now. When the cost of manufacturing decreases dramatically due to EV platforms that allow for software defined vehicles, sales of small but established brands like Buick make increasing sense when paired with global manufacturing scale.