Buick: TTAC's Truth Sucks
Buick's communication manager, Dave Darovitz, takes exception with TTAC's blog about the Enclave's sucky sales. We received the following message from Mr. D.:
Just so our buddy Frank has the correct information – that is your outlet claims to be about the "truth" – let me give you and Frankie a dose of it. The Enclave IS the hottest selling crossover in the industry. We've sold more Buick Enclaves in half a year of production than Mazda CX-9 sold in one full year. And, 90 percent of our Enclave sales are of the uplevel CXL model – the highest contented, richest model we offer. Nearly half of our Enclave customers are new to GM, and we've had a waiting list of paid customers since we started producing the crossover. Finally, customer and dealer demand for this standout Buick far exceeds what the plant can physically produce. So, if this "sucks", what's Frank's definition of success?
Well Davie, I'd like to know how you define "hottest selling." Even the Enclave's corporate-cousin Acadia far outsells it month after month, as do the Lexus RX and any number of other CUVs. The CX-9 hasn't been on the market for "one full year" — it went on sale in February. And with all the awards the CX-9 has gotten over the Enclave, they're getting a lot of free press which will drive sales up. Incidentally, you only sold about 4K more Enclaves than Mazda sold CX-9s. Can you sustain this, or will Enclave be like other GM models that tank once you satisfy the initial demand?
So what if the CXL model is the best-selling trim level? I don't know anyone who tracks sales by trim level. It's good you can pull some new buyers from outside GM, as Buick's traditional customer base is dying off with alarming regularity. How long do you think your "paid customers" will wait when they see other comparable vehicles readily available?
Finally, if demand is that high, why aren't you diverting production at this overtaxed plant (where they recently shut down the third shift) from the Outlook (which is busy gathering snow on dealer lots) to the Enclave and 1) bolster dealer morale and let them average more than five sales per month, 2) satisfy all these customers who are lined up money in hand, 3) help Saturn deal with their almost 100-day supply of Outlook and 4) drive up Buick's overall sales numbers and bottom line (which is never a bad thing)?
My definition of success? A car that sells well without artificially manipulating supply against demand and keeps on selling well even after the initial demand has been satisfied. So far Enclave has yet to satisfy either of these expectations.
Your serve.
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The problem lies in that 1% of the time - however, we'll all go buy a Ford S-Max, Saturn Zafira, Honda Stream, Mazda5, Toyota Verso et al
In answer to Starlightmica's question, I can only surmise what GM expected to produce, not what it expected to sell. We know the approximate production capacity of the Lansing Township plant and we know the approximate product mix among the Lambda triplets, which allows us to back into a rough projection. But why they chose the product mix that it did is an answer that I can't provide you (which is one reason I hadn't yet run with this story.) The good news: the low inventories are a good sign for GM, in that overall demand for Enclave is well matched to supply. That limits the need for incentives, supports the profitability of their dealer network, and should lead to better used residuals. However, this issue of allegedly long waiting lists have me baffled. The waiting list story may or may not be true, but whatever it is, it isn't consistent with GM's own reports of days-of-inventory data. Competitors that often maintain similarly low inventories in the 20-30 day range (e.g. BMW and Lexus) maintain strong sales prices, yet don't carry these extensive waiting lists. Meanwhile, Edmunds reports that average sales prices are about $1k below MSRP, again another sign that there shouldn't be considerable waiting lists. Overall, I am led to believe that GM had relatively modest expectations for the Enclave, and that low hurdle was met and possibly exceeded. GM's press spin has been hyping the low inventory data, which itself is a good thing. But the inventory data only tells you that the company is producing supply in line with demand, not that the vehicle is wowing the market. While I wouldn't go so far as to call it a flop, there has been a lot of PR hype about it being a raging sales success, even though the unit sales figures don't support that conclusion.