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Analysts Say: GMC And Buick Poised For Success, Thanks To SUV Boom

Both Buick and GMC have become darlings of General Motors as the market turns away from sedans and passenger cars to larger crossovers and SUVs. The proof isn’t only in the brands’ sales numbers, but analysts say Buick and GMC will continue to ride high with SUV-centric lineups.

At Buick, sales grew 12.3 percent in 2016, which outpaced the industry three times over, according to The Detroit News. With its growth, Buick is now the fourth-largest premium brand in the United States, only behind Mercedes-Benz, Lexus and BMW. That’s right, Buick is bigger than Audi and Cadillac.

Kelley Blue Book analyst Michelle Krebs said, “the SUVs have brought new customers to the brand and brought its aging buyer demographic down.” Combined with the right product at the right time (we’re looking at the Buick Encore, specifically) and a quirky marketing campaign to fend off stereotypes, Buick is now a 70 to 75 percent SUV brand today.

2017 Buick Encore exterior 005

GMC never had the image problem Buick did, but the SUV boom allowed the brand to fully flesh out its core competencies, that is premium SUVs and trucks via the Denali sub-brand.

“GMC has done the right thing for a long time,” KBB’s Krebs said. “It’s allowed them to stay true and authentic to their customers. Now the SUV trend gives them a great opportunity to head-to-head against Jeep as the premiere utility brand.”

The brand’s sales have doubled from 2009 levels, and despite a plateauing car market, sales are up another 3 percent this year. The now mid-size Acadia and compact Terrain help further define GMC’s SUV segments. GMC says it has high hopes for the 2018 Terrain, in particular, with a softer, more premium design that should appeal to more female buyers.

In the grand scheme of things, GM benefits from the market’s love affair with SUVs in general. When thinking of SUVs, studies show most consumers think of American automakers—not foreign companies. SUVs are inherently in GM’s DNA, and its brand will ride that wave for all its worth.

Former GM Authority staff writer.

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Comments

  1. Well, looks like keeping Buick and GMC in the fold was a good call.

    A little bit of revisionism by Mr. Aldred in the Det News piece though. (Minor, but whatever).

    He made it sound like Buick were the visionaries behind the Encore, which was originally the Opel Mokka.

    Nevertheless, Buick moved quickly to bring it to market. They moved quickly to bring the Envision to market (styling tweaks to come), and it all synched with a refreshed Enclave/Acadia.

    So -boom – Buick has a 3-SUV lineup. Doesn’t really matter that one’s an Opel from South Korea, one’s Chinese; they moved, they moved fast, and it paid off.

    And attracted an enviable clientele.

    Reply
    1. Looks like Envision is getting a short run as an 18 with 2019 production starting up in April

      Reply
  2. I was surprised when Buick stayed after the bankruptcy. I always had a soft spot for old Buicks like the Riviera and other models from the sixties into the early 1980s, but the old division didn’t have the appeal ten years ago that other divisions had. I thought they should have kept Saturn, which was trending up and doing well with younger demographics, and maybe just kept Buick for China.

    GMC was also a surprise because every model they had was redundant with Chevy. But GMC was profitable, hence the reason for survival. I love the current styling trends coming out with the Acadia and the Terrain.

    Hopefully GM trims options by grouping into 2 or 3 comprehensive trim levels and avoids cookie cutter redundancies with the lineup.

    Reply
  3. Buick doesn’t have any SUVs, only CUVs. I don’t see that changing anytime soon either because if Buick was allowed to make an SUV from the GMT K2XX plaform that the other divisions use, it would instantly overtake the Cadillac Escallade in sales.

    Reply
    1. You have a point – SUV might as well mean Suburban Utility Vehicle. And CUV, Comfort Utility Vehicle.

      Reply

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