A replacement for the current, first-generation Buick Encore subcompact crossover is on the way, GM Authority has learned from sources familiar with the matter.
Before we get into the details, let’s first review the landscape: Buick encore sales in 2020 totaled 41,752 units, a drop of 59 percent over the 102,402 units sold in 2019. In just 12 months, the subcompact CUV went from being the 8th most popular General Motors vehicle sold in the U.S. to the 15th.
Sales Results - Q4 2020 - USA - Buick
|MODEL||Q4 2020 / Q4 2019||Q4 2020||Q4 2019||YTD 2020 / YTD 2019||YTD 2020||YTD 2019|
The primary reason for the drop in Encore sales was another product from the Tri-Shield brand that competed for the same general segment: the slightly larger but significantly more more modern Buick Encore GX. With sales of 44,841 units, the Encore GX outperformed the regular Encore in 2020, despite being more expensive.
This is a problem for Buick, but it’s one that we believe has an obvious solution. The subcompact crossover segment is starting to fragment into two distinct sub-segments which we could call ‘premium’ and ‘budget’. Premium vehicles, in this context, have average transaction prices (ATP) several thousand dollars higher than their budget counterparts.
Currently, Buick competes in both of these subcompact sub-segments with the Encore (budget offering) and Encore GX (premium offering). By comparison, most rival such as Ford, Honda, Jeep, Nissan and Toyota are operating in only one or the other.
Back to the next-gen Encore: we’ve confirmed via our sources that GM is, in fact, planning to replace the first-gen Encore currently on sale in the U.S. and Canada with another model. In other words, Buick will continue competing in both sectors of the subcompact crossover space. This is significant in and of itself, as it runs contrary to rumors that GM will simply discontinue the aging Encore, without a replacement.
As for the direction that GM will take in replacing the first-gen Encore, one needs to look no further than China. Local versions of the Encore and Encore GX went on sale in China in 2019, and the duo is seeing healthy levels of success in the local market. While the Encore GX is the same GM VSS-F-based model as its counterpart sold in in North America, the “regular” Encore received a complete overhaul for China, moving from the Gamma II platform that underpinned the first-generation model (and continues to underpin it in the U.S. and Canada) to the new GEM platform.
Short for Global Emerging Markets, GEM is essentially a simplified version of VSS-F. As its name implies, GEM was not originally intended to be used as the basis for vehicles sold in the U.S. or Canada. In fact, not a single GEM-based vehicle is currently on sold in either of the two countries. However, all signs now point to General Motors changing its position on the matter. In fact, a GEM-based Buick Encore for North America would likely be much cheaper to manufacture than the current model, since the primary goal of GEM is to keep costs to a minimum.
|2021 Buick Encore||U.S.||Gamma II||$23,200|
|2021 Buick Encore GX||U.S.||VSS-F||$2,420|
|2021 Buick Encore||China||GEM||125,900 yuan / $19,500|
|2021 Buick Encore GX||China||VSS-F||155,900 yuan / $24,108|
In the case of the Encore family, the GEM-based Encore has a starting price of 125,900 yuan in China, which translates to about $19,500 USD (at current exchange rates). The Encore GX, meanwhile, starts at 155,900 yuan, or $24,108. That makes for a healthy gap between the two models, much healthier than the one that currently exists between the original Encore and Encore GX in the U.S.
In conclusion, we believe that GM is currently hard at work making the necessary changes to the GEM-based Encore in order to sell it in the U.S. and in Canada. We’ll be back to report more as soon as we have it, so be sure to subscribe to GM Authority for more Buick Encore news, Buick news and ongoing GM news coverage.