Gm Found a Strong Market for Buick in China

2006 was a great year for Buick, the brand that boasts of golf celebrity Tiger Woods as its chief spokesman has been able to sell more cars in China as compared to United States. And now that the Buick has become one of China’s top-selling car brands it is likely that the gap will further widen according to General Motors CEO Rick Wagoner in a statement he made last month in Shanghai.

Buick, a division of General Motors the renowned producer of quality Buick oxygen sensor has trimmed down the brand’s lineup to three vehicles for its US market while sells eight models in China and plans to create additional models for the growing Chinese middle class, which GM executives and analysts refer to as “aspirational” car buyers.

Joseph Liu, GM China Executive Director of Vehicle Sales, Service, and Marketing said, "The vision in China for Buick is the premium, yet attainable brand for the upper-middle-class customer. Buick is for China's new generation of elites in pursuit of success, who want grand, elegant, contemporary design."

The sales of Buick in China are considered promising and profitable---a great market for General Motors, which is still working to return its North American auto operations to profitability. For the first three months of this year, GM’s North American operations have lost $85 million but luckily the $127 million profit gained in China has helped the automaker to boost the overall profitability of the company obtaining a $62 million profit for the quarter.

The Buick brand in China has played a key role especially in reaching the 303,150 units sold last year from 110,763 four years ago. The growth of the Buick brand in China is part of GM’s overall expansion in one of the world’s fastest-growing market. On the other hand, the US sales of Buick continue to shrink from 432,017 four year ago down to 240,657 last year.

The future of the Buick brand in China is at present bright and will continue to do so for years to come. Buick is also planning to increase its lineup not just at the current upper middle class, which according to research journal McKinsey Quarterly estimates at about 10 percent or 130 million of China’s 1.3 billion people, but also for the 520 million up-and-comers that McKinsey expects that would comprise the middle class by 2025.

The lineup of the Buick brand for China includes hatchback, sedan, and wagon versions of the Excelle, the Regal, and LaCrosse mid-size sedans; two minivans; and the new Park Avenue sedan, which was launched earlier this year and defines as mid-luxury.

In addition, GM China is also working on a hybrid Buick sedan design for the China market. And although GM is expanding its Buick lineup in China it has no plans or whatsoever of doing the same thing for its US market. The fine interiors as well as the appealing designs of the Buick are factors that might have captivate the Chinese middle class.

Wagoner said, "Because we're developing and growing in China, we need a broader product portfolio to support it. Some of those products can be used in the U.S. I don't necessarily mean imported, but once they're designed and developed, if all you have to do is tool it up to build it in the U.S. or Canada, that's a much lower cost proposition. So I think a stronger Buick here actually helps the Buick brand in the U.S."