General Motors is currently fighting to exempt the China-built Buick Envision from a 25 percent tariff enstated by the Trump administration. Now, the automaker said it could pull the luxury crossover from the U.S. market if its request is denied.
The latest comments on the Envision’s future come from GM President Dan Ammann. Speaking to reporters at the Billington Cybersecurity Summit in Detroit, Ammann said the tariff exemption is the “only way” to continue selling the Envision to U.S. customers.
“That’s a vehicle that is a relatively low volume vehicle in the U.S. market,” he said, according to Automotive News. “It’s a high-volume vehicle in China, so in order to have that vehicle available in the U.S. market, this is the only way that can work for us.”
Without the exemption, the Envision will likely exit the market. Buick sold 41,000 Envision crossovers in 2017 compared to 200,000 units yearly in the crossover’s home market of China. In its filing with the U.S. government, GM said the “vast majority” of Envisions are sold in China, which makes building the CUV locally the best option. The 41,000 units sold in the U.S. don’t justify a U.S. manufacturing plant, and the Envision’s exit would remove an essential product from the Buick brand: a mid-size luxury crossover.
Ammann added, “The profitability that we generate on that vehicle, selling it in the U.S. market, we obviously reinvest in the business here so we think it’s in everybody’s interest for that to continue.”
On tariffs, GM itself warned the Trump administration that continued effects could lead to a smaller GM with lower U.S. production and job losses at American manufacturing plants.
This example is a former NCRS award winner.
Many automakers oppose right-to-repair laws citing cybersecurity concerns.
Breaking out the spec sheets for a comparison.
Plus, a nationwide lease on all-electric off-road Pickup and SUV.
Extra comfort for rear-seated passengers.
View Comments
Obviously there is an agreement (with SAIC) that the Envision is only to be assembled in China and GM is reluctant to admit as much. This vehicle is on GM D2XX, that same platform underpins the current Equinox and Terrain. Those 2 are assembled in Canada and Mexico. The idea that there is "no way" to add the Envision to one of these facilities is absurd. Remember the facts, this vehicle is priced between $34-44K and even on a bad month over 2000 are "going over the curb".
An Opel version of the Envision would probably also have been assembled in the Rüsselsheim factory as the "second flagship besides the Insignia" promised for the end of this decade, and then exported from there to the USA as Buick, as the Regal in all its body shapes already is. Take note that the Buick Regal could also be exported from China, but GM preferred the Opel factory which was 100% GM owned when the decision had to be taken.
There is certainly no "only China" accord with SAIC, but GM is probably rather reluctant, as all foreign automakers are, to export from their Chinese joint-venture because they would have to share the profit with their Chinese partner. The Chinese partner would rather interested in such a profitable export business, but the foreign partner is not so interested...
This will vanish as the Chinese policiy to withdraw gradually the 50:50 requirement for foreign automakers. BMW already got this year the approval to increase their share in a Chinese joint-venture above 50%.
I doubt anybody would notice. It's not a compelling product and anyone shopping for this type vehicle can select from a multitude of other offerings from GM's own lineup or from competitors and virtually all the other options are produced in the US or at least in North America. As I see it, nobody is going to care so GM can threaten all day long but they'll get little reaction. If this were the Corvette people would care but with the Envision, or Envasion as it's been called, only people working for General Motors will notice.
Further the Buick brand itself has seemingly become merely a repository for GM products wordwide with overcapacity potential in their plants. The Polish plant producing the Cascada obviously is able to build more cars than the European market can support so the excess capacity gets sent to the US and a Buick dealer. The same is true with Regal, TourX, Encore, and Envision so I doubt Buick really needs the Chinese-import as much as China needs to keep their plant running at full capacity so GM sends their excess product to Buick in North America. Buick has become the Overstock.com of car brands.
Trade wars could possibly leave Buick as a two or three vehicle Chrysler-like brand.
GM only covers the Americas and China so slow sellers need to either be built in the same plant or eliminated.
Due to low volume the next Lacrosse must come off one line and China is the only logical location. Same for Envision. Same for a Regal replacement. Buick Blue products, too, would come from China. This production model may eventually cover Cruze and Malibu, too.
GM only garners high margins do to its efficiency. GM minus China-only brands fails to move large quantities like Toyota or VW.
Buick, especially with Avenir, is a gravy on top kind of brand. What suprises me is that GM isn't reskinning Terrain or XT 4 to fill the Chinese Envision void. This suggests GM can't or won't allicate three capital for such a plan.
GM holds warrents for PSA stock. Maybe cars can be sourced from Europe?
General Motors should build the Buick Envision in the United States; the Envision is built on GM's D2XX vehicle platform which is the same as the Chevrolet Cruze meaning.. it might be possible to build the Buick Envision at GM's Lordstown Assembly plant in Ohio which currently builds the Chevrolet Cruze and it could be a win-win situation for everyone given that Chevy Cruze sales are down.
Well give us the cost to revamp the line in Lordstown and spread the cost over $41k units per year.
Then if the. Cruze continues to falter what else do you put in the plant that would have as much and hopefully more volume?
How long would it take to make the changes if you started today 2021? 2022? Will there be a Cruze by then?
Or do you wait and move a unreleased product to Lordstown that will exceed volumes of the Cruze and uick combined.
These are just a couple of the dozens of considerations needed when moving product. There are many more were are not open to due to confidentiality of products outside the company.
Playing Web CEO is easy for all of us till we face the real cold realities of what they really face.
Bu-bye....
Fine with me. Would never buy one anyways and there are already far too many SUV choices to start with.
I think it's a question of cost versus benefit, what with the similar GMC in the same showroom. But it is a peek at the future, with Buicks being made in the country where they are mostly bought. China. And with a 25% import duty, there won't be any sold in this country. Leaving Chevrolet to sell basic level cars and trucks, and Corvettes; GMC to sell premium level trucks, and Cadillac selling luxury cars and trucks. If cars make a comeback, so can Buick, being premium level cars made along side Chevrolets or Cadillacs.
It seems that General Motors refuses to invest in the Buick brand in the USA. Does it not occur to them that a fully competitive product, designed and built in the USA, would very likely sell far better than the existing Chinese-built Envision?
That assumes, of course, that GM actually develops a cohesive marketing strategy for the Buick brand in the USA. GM's failure to do so is difficult to understand.
"Does it not occur to them that a fully competitive product, designed and built in the USA...would likely sell far better"
What evidence is there that this is remotely true?
- Buick's most successful product over the past 5 years has been the Buick Encore -- it has been a smash hit. Not a single one has been built in the US.
- On the flip side, the Cruze sedan is built in the US -- how is it doing? Same with the Buick LaCrosse.
If your response is, "CUVs, of all sizes, are more popular now", there's your answer. The American consumer has repeatedly shown it cares most about price, quality, features and performance -- where it assembled is way down the list.
If GM moved the Envision to the US, it's profit per vehicle would go down; there is no doubt about that, as US workers are paid more and GM would lose the efficiency of producing all the Envisions at the same plant that is already configured for it (e.g., Lordstown would require significant investment to get ready).
GM has already shown that it is all about profit per vehicle -- it will cut out whole countries and vehicle lines that don't meet the return they feel necessary. I have some disagreements with that, but that's what the stock market has demanded, so that's what they are going to do.
bye bye Envision the reason I don't own one because it is not assembled in NA , so if the brains at GM dont want to build it here and would prefer not to import it then I say SO BE IT .. the 41k units GM would lose out on will go to other brands . and maybe not GM . GM should decide to build all Buicks in other countries making them foreign cars and end it .. Then the smart move is to bring back OLDSMOBILE & PONTIAC which were always more stylish and better sellers then Buick
My word, this website generally has some good commenters (whether I agree with them or not) but these articles on tariffs and assembly location really bring out the nonsensical comments.
You think the smart move is to bring back OLDSMOBILE? In today's hyper-competitive market place, what would a brand associated with large, land-based sedan yachts bring in terms of cachet in where the vehicle market has already headed -- CUV/SUV, trucks or off-road?
Cmon.
"Then the smart move is to bring back OLDSMOBILE & PONTIAC which were always more stylish and better sellers then Buick"
https://www.youtube.com/watch?v=ztVMib1T4T4
Nope! 'Better sellers' aren't as important as a higher transaction price. Olds had worse ATP than Buick at the time of it's demise, and Pontiac never came close.
The GTO and G8 perhaps, but lets be real here, they were always niche products that never had the volume to go long term. The G8 GXP had an MSRP of just over $40K, but Buick can command just as much for smaller, less powerful, FWD vehicles...and that's just fine for Buick and just fine for GM.
I don't play poker, but I'm calling their bluff here. I bet they bring it to either the Equinox or Terrain plant. There's too big of a gap between Encore and Enclave for Buick not to have something, and if they can build Terrain Denali in Mexico and make great ATP, they can do the Envision as well.
Yeah, its because of the "too big of a gap between Encore and Enclave for Buick" why GM thinks that Buick needs the Encore.
And with this gap being empty ... some people in the automobile press think that this could lead to the demise of Buick in NA altogether. Thanks to POTUS Trump.
Just Build it here in the U.S. Plain and simple. Problem solved. (((Invest in USA built Automotive Products)))