For a company that the federal government wanted General Motors to axe amidst the automaker’s Chapter 11 reorganization in 2009, GMC has done pretty well for itself. Last year, GMC sales soared nine percent year over year, but the real cash-cow is the company’s brand-within-a-brand, Denali.
Denali grew by more than 20 percent last year and more than doubled its volume since 2010, according to The Detroit Bureau. That accomplishment is even more impressive when you take into account that GM does not market the Denali nameplate specifically. “It’s largely all been organic,” says GMC marketing director, Roger McCormack.
Full-size SUVs return some of the largest profit margins of any vehicle in GM’s lineup. Joe Philippi, a consultant for AutoTrends Consulting, says most customers will pay more than $70,000 for a Yukon Denali XL, which according to him, “epitomizes the concept of obscene profitability.”
GMC targets “professional grade” buyers, who may be more affluent and in need of something fancier than what is offered by the mass-market Chevrolet models. Denali models take that idea a little bit further, offering options and equipment which are specific to Denali models.
The 2015 Yukon Denali features a powerful 6.2 liter V8 engine, GM’s patented magnetic ride control suspension, a heads-up display, HID headlamps, large 22-inch wheels, upscale interior appointments and active interior noise control. These exclusive amenities help attract a customer which GMC says is younger, at 44-years old, and wealthier, with an average household income of $134,000.
GMC claims the Denali brand has been able to attract a buyer which otherwise might have opted for a vehicle from a foreign luxury brand like Mercedes or BMW.
“The Denali customer is naturally attracted to the best of the best in whatever they’re buying,” McCormick said.
GM, now looking to capitalize on the Denali nameplates profitability, offers a Denali variant for every model in GMC’s model range. The diversified range has helped Denali sales grow from 32,886 units in 2010 to 75,558 last year.