Chevrolet appears to be planning to launch the new, American-market Cruze in China, GM Authority has uncovered.
In its sales report for June, GM china wrote earlier this month that “the all-new Cruze passenger car will be launched this quarter”. And now, a splash page on Chevy’s Chinese website shows a picture of the all-new, American-market Cruze, which is currently not sold in the Chinese market.
A photo of the American-market Chevy Cruze shown on the Chevrolet China website
Two Different Cruzen
Chinese-market D2-based Chevy Cruze
American-market D2-based Chevy Cruze
To note, there are two versions of the all-new Chevrolet Cruze based on GM’s new D2 platform. The first was launched in late 2014 and is available exclusively in that market. The second is the model sold in the Americas — North and South America.
Chinese-market D2-based Chevy Cruze
American-market D2-based Chevy Cruze
Despite sharing a common name and the underlying D2XX platform, the two models are quite different: the model on sale in China features different styling, has a smaller footprint, and features less high-end features than the model currently sold in the Americas.
Chinese-market D2-based Chevy Cruze
American-market D2-based Chevy Cruze
Cruze XL Nameplate
If Chevy is indeed planning to launch the larger Cruze in China, then we expect the vehicle to be given the Cruze XL name. The practice would be similar to Chevrolet selling the all-new, ninth-generation Malibu as the Malibu XL in China, while marketing the outgoing, eighth-generation model simply as Malibu.
Offering both the new and outgoing models allows Chevrolet to reach a lower price point. For instance:Â the all-new Malibu XL has a starting price of 179,000 CNY ($26,800 USD), while the outgoing Malibu has a more affordable starting price of 164,900 CNY ($24,605 USD).
Requests for comments and clarification of GM China’s statement and website photo were not returned by the time of publication. We will update this story if/when we do hear back.
The GM Authority Take
Based on the statement and photo described above, we truly believe that it’s only a matter of time before the Cruze currently on sale in America is manufactured and sold in China, alongside the existing D2-based Cruze. Such a vehicle should help Chevy’s faltering sales in the world’s largest automotive market. The only question now is whether Chevy will sell the American-market Cruze exclusively as a four-door sedan, or if it will also offer the upcoming five-door Cruze hatchback.
Comments
At some point they will sell both.
They love sedans there and the Hatch is also more popular there than here and would help leverage the development costs since it will not be sold in Europe like most hatches.
The strategy of selling two very similar cars with the similar genetics can’t be much different than GMC selling both the older generation Arada as the Acadia XL alongside the 2017 Acadia.
Well, the strategy in question here has been in place for a while in China. The practice of doing the same for the Acadia limited (last generation) and the new Acadia (new generation) is somewhat new for the North American market, with the biggest difference being that the China practice is permanent, while the North American one is temporary. In other words, the Acadia and Acadia Limited will be produced/sold side-by-side for only a year or so, while the Cruze and Cruze XL will be sold together for the lifespan of the models.
Also in the cases of cars like the Malibu,Cruze and some others they are sold to fleet for one to two years to help protect the resale of the new cars that just came out.
I do not believe the fleet issue is much of a problem in China.
That’s right — GM follows the strategy of selling a new generation alongside the old one to protect resale values in North America, mostly the U.S. Though at this point, with lower fleet sales, the practice isn’t as necessary as it was before.
And you’re also right in saying that fleet isn’t an issue in China.
So is this an American made Cruze or a Mexico made Cruze to be sold in China?
For North America, the Cruze sedan is made in Lordstown, Ohio while the Cruze hatchback is made in Mexico.
For China, it will be made in China — just like we mention in the post:
…”we truly believe that it’s only a matter of time before the Cruze currently on sale in America is manufactured and sold in China…”
The way I see it they ship the Envisions over here… and then as the boat begins to head back… GM says, “Wait! Can you drop some of these Cruzes off in China since you’re headed that way anyways?”
It’s a green thing.
And in doing so, you’re going to incur a 35 percent import tariff into China, which you will pass on to the consumers (because no one wants to take a loss on a vehicle), causing your $25,000 Cruze to have a starting price of $33,750, and ensuring that almost nobody buys it, thereby ensuring total business-level failure of the vehicle program in that market.
It’s a sad reality, but a reality nonetheless — China imposes very hefty taxes on products imported into the country for sale in the country. Maybe the U.S. should do the same, or better yet, review its entire trade policy.
With a little luck, we’ll be doing that in January 2017.
So a 35% tariff, and then SAIC and GM split the remaining proceeds 50-50?
Sorry to be slow on the uptake – still trying to figure out how this deal works …
US labor (good for jobs, but more expensive), Transport to, where, Long Beach? Ship them to China. Pay a 35% tariff. Split it 50-50 … so is the labor 50-50? Transport 50-50? If we’re paying a 35% tariff, and paying labor and transport vs. depressed Chinese currency, well, I won’t rush to any judgement –
but if you know how this deal works and why it’s relatively good for us, I’d appreciate it. Thanks …
There is only a tariff when the vehicle is imported. In this case, I don’t expect the American-market Cruze to be imported to China, but rather built locally for the Chinese market. From there, the profit is, in fact, split 50-50 between General Motors and SAIC. However, the costs of operations (such as labor, manufacturing set-up, plant construction, and other kinds of local investments) are also split 50-50 between GM and SAIC.
Thank you, sir. Like I said, still trying to suss this out.
The headline does say “American market Cruze to be sold in China”; makes more sense to build them there. But if that’s not the case (yet) I suspect it eventually will be.
Thanks again, Alex.
Let me get this straight. First, GMs forever kowtowing international marketing geniuses decided it necessary to invest in two versions of the same automotive platform so that the cherished Chinese market would have its own special car rather than designing and engineering one excellent automobile to sell worldwide. Now, two years on, they’ll augment China’s Cruze with ours because, reading between the lines, China’s exclusive comes up short compared to the one made in Lordstown for America’s unwashed masses? Smells like teen spirit.
To make a true mockery of the situation, instead of increasing production capacity and exporting the Lordstown built car (even the Mexican built hatchback) – as would happen if our current bastardized definition of “trade” actually meant exchanging goods and services – they’re going to manufacture it in China?? Way to go, globalists! Of course, this comes as no surprise as our self serving Chinese “trade allies” have never supported, nor do they have any intention of being coerced to engage in anything resembling true international trade. Loving that 35% import tariff our toxic government apparently believes is fair play and somehow beneficial to Americans.
Why do we continue to pass this off as being completely acceptable and inevitable? More stealing directly from the pockets of the cash strapped US working class is what it is. Time to Trump this insanity.
I look differently on the part about making a different Cruze for China. Specifically, it’s a two-car strategy: the first one is more affordable/plebeian, while the second is more premium. The same can be seen across GM’s own Buick (Excelle and Verano) and other automakers, including Volkswagen, Ford and Toyota.
As it relates to the import tariff: not sure why the U.S. hasn’t yet reciprocated with a similar tax on large goods or goods priced above a certain dollar amount. Not sure if Trump can or will fix/address this… but that’s a subject for a different time.
He won’t! He has his clothes made in other foreign nations, then has his name branded on and sold here.
http://edition.cnn.com/2016/05/26/politics/trump-clothing-foreign-made/
http://www.factcheck.org/2016/05/trumps-made-in-the-u-s-a-spin/
http://money.cnn.com/2016/03/08/news/economy/donald-trump-trade/
http://abcnews.go.com/Politics/donald-trump-decries-outsourcing-family-brand-manufactured-abroad/story?id=37502012
I see this as great for the U.S. because the Cruze is assembled in China with American parts so the greater profit stays here. The profit difference goes to SAIC for the final assembly cost only. This is what the imports are already doing in the U.S. by assembling their best sellers with American labor but using their imported parts, thus keeping the most profit overseas and weakening the American economy.
I see post complaing about assembling GM cars in China but nobody has protested the imports assembling and sold here,