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http://www.forbes.com/2005/06/14/generalmotors-buick-discontinuation-cz_jf_0614flint.html?partner=autos_newsletter

Backseat Driver
Death By Starvation
Jerry Flint, 06.14.05, 6:00 AM ET

Just suppose a car company wanted to shut a division. Pretend for a moment that it is General Motors and the chief executive has decided to close down Buick. Would he hold a press conference and say this:

"I want to announce that we are closing Buick. I admit that my management and my predecessor did a terrible job. The dealers are swell, but we couldn't come up with cars that people really wanted. So we're throwing in the sponge and are shutting down Buick over the next 12 months. Any questions?"

You'll never hear that statement. Every dealer seems to have a son-in-law who is a lawyer, and they sue when their franchise becomes worthless. When General Motors (nyse: GM - news - people ) announced at the end of 2000 that it was killing Oldsmobile, it was most generous in its settlements with the dealers.

Back in 1964, Studebaker announced it was shutting its car plant in South Bend, Ind. They were really exiting the car business. But Studebaker said it would keep assembling cars at a Canadian plant as long as people wanted them.

I asked my good friends at Studebaker why keep Canada going? They explained that it was a legal strategy. By keeping production going in Canada, they could say they were offering cars, but when no one bought them, it wouldn't be their fault. They would then shut the Canadian plant because of lack of orders, and this would protect them against lawsuits. Sure enough, in two years the Canadian plant was shut.

So there's a legal strategy. I recall how Plymouth was starved for product before it was killed a few years ago. Four cylinder cars, which should have been Plymouths, were called Chryslers.

And look at what's going on with Buick:

A vice chairman talks about "damaged" nameplates and hints it's possible that some could go. That means Buick.

A Buick-Pontiac-GMC truck dealer group is set up. The dealers are to sell all three makes. Thus, if Buick does go down, this dealer body can still sell the other brands. So dealers will have a tougher time winning lawsuits.

The Zeta project for the rear-drive cars that everyone knows Buick needs was killed. And we hear that the Rendezvous sport utility vehicle, which currently accounts for 21% of Buick sales, is headed for the graveyard. GM just gave away $2 billion to get out of a bad deal it made a few years ago with Fiat. At nearly the same time, the official spin from GM's press machine is that the once-planned U.S. offshoots of the Zeta line were just too expensive.

The truth is that Buick sales are already in a steep slide, and the division has killed far more models than it is adding. In the last year, it dropped the Park Avenue, Regal and Century sedans. The new Terraza minivan is on the endangered species list. Buick will probably sell 250,000 vehicles this year, which is be less than what Oldsmobile sold when it was given the death sentence.

What's does Buick have to offer customers?

The new Buick LaCrosse (replacing Regal and Century cars) came out last fall. It is a decent car, but fully loaded it stickers for $32,000 and is up against great competitors. Year-to-date, Buick sold 34,420 copies of the LaCrosse versus a total of 40,938 Regal and Century models in the same period last year.

Coming this fall is a new larger car, called the Lucerne, which will replace the discontinued Park Avenue and the soon-to-be-discontinued LeSabre. The Lucerne looks attractive, and it will offer a V-8 option. But my guess is that GM will overprice the Lucerne, a common GM practice on new models, and its sales won't match the two cars it's supposed to replace.

Another issue: the Lucerne is front-wheel-drive but most luxury and near-luxury competitors have rear-wheel drive or all-wheel drive. So it's just hard to see where this car will stand out in combined showrooms that also sell Pontiacs and GMC vehicles.

GM has excuse for everything. We've been told that the vice chairman's comments shouldn't be interpreted as a threat to Buick, and there's no plan to kill it; that a replacement for the Buick Rendezvous is coming, and that combined Buick-Pontiac GMC dealers are a good way to cut costs and to keep dealers from adding foreign brands. We're told that GM's new marketing strategy, designed to weed out look-alike vehicles and create unique lineups, will help make those combined dealerships a success. More cutbacks are also supposed to be the answer. In early June, GM Chief Executive Rick Wagoner announced additional plant closings are coming and a 25,000 reduction in its workforce (a sixth of GM's U.S. total--mostly by attrition) over the next three years.

Buick sells twice as many vehicles in the U.S. than Saab sells globally, but GM seems more interested in keeping Saab alive --with rebadged Subarus and Chevys--than in saving Buick.

If there is any Buick leadership, I can't find it. One previous head of Buick went off to sell hardware, another left to sell cheesecake. Through all the recent strife, I am not aware of a single Buick man standing up, holding a press conference or making any fighting statement about saving the division.

I remember a few years ago, when the leadership at Ford (nyse: F - news - people ) was determined to kill Mercury, it was starving it of product while officially denying there was a plot to kill it. Fortunately William Clay Ford Jr. stepped in, tossed out the Ford chief executive and, among other things, ordered that Mercury be saved. Mercury sales are now climbing.

Buick was the rock upon which General Motors was founded, the first part of what became the greatest automaker in the world. It has loyal customers and excellent dealers.

Maybe GM's leaders do not plan to kill Buick, but if they aren't, they are giving a misleading impression.
 

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I hate to see Buick go. My father was a Buick man, and we owned several when I was a kid. Of course, the fact that my father bought Buicks and that I would never consider one is symptomatic of the problem. Aren't most Buick buyers in their 60s? Well, times change, and, after all, it's really just a name. Now, if someone would only bring back Packards!
 

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I really think this guy is reading his tea leaves upside down. He's making the steps GM's taking to slim down product lines before/during consolidation of Pontiac/Buick/GMC as 'starvation.' What does he fricken expect, the combined PBG to keep their ENTIRE original line-ups prior to consolidation? So that all three can completely step all over each others toes wile under the same dealership?

Unless they move Saturn in to replace Olds AND Buick they're going to have a big product hole in the GM line-up. I think this guys just another GM nay-sayer looking for any reason to give them the finger.
 

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Discussion Starter #4
I doubt Buick is going anywhere. Like brentil said, critics need something to print.
 

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Technically, when they remove a feeding tube, the patient doesn't really "starve" to death.

Technically, they really die of "dehydration". It happens every day across the country (and occasionally boils over into huge medical ethics debates).

When you have a brand like Buick, and it is "time", you just start shutting off the feeding tube (removing new models), and the patient will expire of dehydration.

Really, though, is it THAT bad that Oldsmobile is gone? I mean, yeah, there's history, but the brand had run it's course... GM is getting smaller (we all know it), the world is shrinking (a small world, but I still wouldn't want to paint it)... How much, REALLY, will we miss Buick if (when?) it's gone?

Honestly, I've never owned a Buick. I prolly never will. The Rendezvous is the only thing I've ever thought of owning - but you have to admit it is NOT a typical Buick product. If the Aztek actually looked like a Rendezvous, I would have never considered any Buick product.

Century
Lacrosse
Lesabre
Park Ave.
Ranier
Terazza

Enh...

I'd still dump Saturn and use the dealerships for other nameplate outlets...
 

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I'd still dump Saturn and use the dealerships for other nameplate outlets...
DaeWoo or Saab? :) But really, I could see Saab sold with the no hassle dealer strategy on which the Saturn system is based. It's really not that much of a stretch.
 

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This guy is full of hot air. No matter which side of the argument he looks at, he is just blowing smoke. He brings up

“No new products/product starvation” – Last I looked, the Lucerne, Lacross, and Raineer and Terraza are new products for Buick. Maybe they are not the “gotta have” products GM really needs, but I don’t think Buick receiving these models constitutes starvation of the brand. In the last 10 years or so, Buick has not had a large model line anyway,

“LaCrosse not selling as well as Regal/Century” He did a good job at skewing the numbers on this one. Lets take a closer look at year to year sales of these models. In 2004 from Jan through may, GM sold 31,583 Centuries and 9355 Regals. That is a total of 40,938 cars. Over the same period, GM only sold 34,420 LaCrosse’s. So sales are way down according to our author. However, he seems to have overlooked the 4751 Centuries (which are being produced for the 2005 MY) and 482 Regals that have been sold this year too. Combined, that is a total of 39,653 cars. So sales are down only 1285 units, or 3% from last year. Since LaCrosse is selling with far fewer rebates than last years Centuries and Regals, I bet profit is actually up despite a 3% drop in sales.

“Buick has tons of loyal customers” – Yes they do, and they can be found in increasing numbers in your local cemeteries every day. It is no secret that the average age of a Buick buyer is well into their 60’s, and has been for a number of years. Maybe the market share decline is simply a result of these buyers dying off, or keeping cars longer because they only drive a limited amount these days. For example, my Grandfather used to buy Buicks, and had 5 in a row before buying a new pickup. He always bought one every 3 years. However, he is 88 these days, and drives about 2000 miles a year total. So he has had his truck 5 years and plans on keeping it a while longer since it is still brand new with less than 10,000 miles. The problem with his argument here is simply the loyal buyers are so old they are no longer buying as often, or at all, for whatever reason. I bet hardly any of these people would consider buying a Japanese or German brand, since they are the generation that fought those countries in WW2 and hold strong feelings about imported cars. However, they just don’t buy many cars anymore.

He is right on some of the major issues. Might GM be planning to phase out a division with their consolidation plan? I have a feeling they are. Is Buick a likely choice? Sure. Does that mean it is done for? Not necessarily. I think GM honestly wants to give the 3 dealers under one roof strategy a try. Make each player more of a niche seller and accept smaller total sales from each brand by cutting the number of nameplates, but making them better. If that doesn’t work, 5-10 years down the road, a brand could get axed. Its not going to happen immediately.




S-man, I do not think many people would miss Buick. The same could be said for Saturn, Saab, and Pontiac. The loyal Saab people feel that Saab is already dead. A lot of the big Pontiac fans never seemed to have gotten over Pontiac switching to FWD for their sedans and going to Chevy V8’s. Saturn’s loyal buyers left when the Ion showed up. In fact, there might not be all that many people who get misty-eyed if Chevy became a truck-only nameplate either (which has been suggested by some). I am not saying that all the nameplates should be put in the trash bin, but if we apply this thought to Buick it
 

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Saabaturn....?

I was actually thinking Holden/Opel imports...

I'd ditch Saab quicker than Saturn... In fact, I had already not really considered Saab in my mind's picture of GM's lineup :lol:
 

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solsticeman said:
Saabaturn....?

I was actually thinking Holden/Opel imports...

I'd ditch Saab quicker than Saturn... In fact, I had already not really considered Saab in my mind's picture of GM's lineup :lol:
Holden/Opel imports: I think Saturn should be selling a version of the new Opel Astra. It is a sharp looking small car, and would sell far better than the Ion.

Saab: GM should never have brand engineered the 9-2X or 9-7X. They are just too close to the Subaru and Chevy originals to convince anyone these are real Saabs. GM is finally selling 9-2X's, but only because of huge rebates that make them cheaper than what Subaru is selling the same car for. Maybe GM really needs to commit some better platforms to Saab, to turn into some really stylish well built cars. I am thinking maybe a Sigma platform derrivative with the new 2.8 turbo motor. I would think a car that rode and drove like a CTS, but with the smooth Saab contours on the body instead of the harsh edges of Caddy's styling would have a place as a nich player at Saab.
 

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Discussion Starter #10
Name-wise I think Saab has potential. That nameplate might not be as tarnished in some people's minds as some other GM brands.

Funny during Saab TV ads they distance themselves so you'd never know they are a GM division. Even for the employee discount they call is "Saab employee discount" instead of GM.
 

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I think the problem for Buick is that yes it's demographic is much older on average. However, the population is getting older and this should play into Buick's hands, but I think the problem is that it used to be that people start in Chevys and move into Buicks and Caddys in their later years. Only now alot of those people have grown up with Hondas and Toyotas and will be moving into Lexus / Infinity and Acuras.
 

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While I was waiting for my Sunfire to get worked on this Morning (Control Arm and brakes were worn out), 2 > 60 year olds pulled up in Buick's. That's the first time I've had a chance to really look at one. Man are those boring looking cars or what?
 

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How boring would life be if we did not have those old boring Buicks to pick on??!! :lol:
 

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Darkhamr said:
However, the population is getting older and this should play into Buick's hands, but I think the problem is that it used to be that people start in Chevys and move into Buicks and Caddys in their later years. Only now alot of those people have grown up with Hondas and Toyotas and will be moving into Lexus / Infinity and Acuras.
The aging population could play into Buick’s hands, but I do not think it is as simple as Buick attracting the aging population because all older people buy Buick’s. We have two generations in play here, the Baby Boomers who are aging, and their parents. I’d submit that these two generations are very different, and looking for different qualities in vehicles. The WW2 generation wants a big car with a plush ride, bench seat, and big trunk. They fondly remember the cloud mobile land yachts of the 50’s, 60’s, and 70’s. The boomers on the other hand want a taughter, better driving, handling vehicle. Most importantly, however, they want something that isn’t like what their parents like because those cars are not cool. They are “old” people’s cars, and the boomers, although nearing and entering retirement, still consider their parents likes to be un-cool.

So, although the boomer generation is creeping up on Buick’s target audience in age, they are in no way going to buy a Buick as long as it looks like, rides like, and drives like a car their parents would want.

There is no reason Buick couldn't tweak it's cars to appeal more to the boomer generation, and they really should start getting at it since the WW2 generation is not buying many cars anymore, hence the sales decline.
 

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Fformula88 said:
The aging population could play into Buick’s hands, but I do not think it is as simple as Buick attracting the aging population because all older people buy Buick’s. We have two generations in play here, the Baby Boomers who are aging, and their parents. I’d submit that these two generations are very different, and looking for different qualities in vehicles. The WW2 generation wants a big car with a plush ride, bench seat, and big trunk. They fondly remember the cloud mobile land yachts of the 50’s, 60’s, and 70’s. The boomers on the other hand want a taughter, better driving, handling vehicle. Most importantly, however, they want something that isn’t like what their parents like because those cars are not cool. They are “old” people’s cars, and the boomers, although nearing and entering retirement, still consider their parents likes to be un-cool.

So, although the boomer generation is creeping up on Buick’s target audience in age, they are in no way going to buy a Buick as long as it looks like, rides like, and drives like a car their parents would want.

There is no reason Buick couldn't tweak it's cars to appeal more to the boomer generation, and they really should start getting at it since the WW2 generation is not buying many cars anymore, hence the sales decline.
This discussion could have been about Cadillac, ten years ago. At the time demographics had the mean age even older than Buick. Yet GM redesigned their line up to meet just the requirements you describe for Boomer Mobiles. But the question is, would it work for two brands under the same roof? It would be a fine line to keep it from cutting to much into what they fought so hard to win.
 

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Sorry Ff, we are saying the same thing. I was commenting on the demographic that Buick typically calls customers expanding as a percentage so there is opportunity for them, however they are not making the vehicles this emerging group actually wants.
 
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