Buick Enclave, Chevrolet Malibu Supply Mystery Solved
The Lansing State Journal reveals the reason Buick Enclave and Chevrolet Malibu sales are stuck in second gear: parts. According to Gary Cowger, GM's group vice president of global manufacturing and labor, "a lack of components" underpins this December's decision to shut down a third shift at Lansing Delta Township factory. "Even if that had kept running, we still wouldn't have been able to make more Enclaves." What's more… "As you know, we put that third shift on for a while to try to ramp up. But at the tooling rates of the supplier base, you'd have to buy another set of vendor tools (to make more parts) and that takes time. We're maxed out from a tooling standpoint." Cowger also implied that the Chevrolet Malibu drought is down to the same parts problem. "What we're doing right now with the Enclave and CTS and (Chevrolet) Malibu is doing a very detailed analysis of the bottlenecks in the supplier community so you can invest in the right tool sets out there and increase the capacity of that product at the plant." Cowger admits GM underestimated demand for all three cars, but said it's "a good thing." Try telling that to the 1000 GM workers who got laid off, or the GM dealers desperate for product to sell. Oh and don't think we've forgotten that back in October, when GM announced they were shutting down the third shift, they told the LSJ they "eliminated the third shift to keep from overproducing the crossover vehicles made there." I wonder why they didn't bring up the parts issue then? [thanks to Sparky for the tip]
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Its always good to see someone stick up for all those workers getting laid off. I bet those GM workers have a new found respect for you Robert.
In a quest to get beyond the GM hype machine, allow me to address this point by MPLS: When was the last time demand outstrip supply for a GM mid-sized sedan? Let's put this in the context of actual sales. Between July and December, Buick delivered 23,722 units. If we assume that the annual sales pace is similar to this amount, that would mean that the Enclave is good for 48-50k vehicle sales per year. The Enclave is a replacement for both the Rendezvous and Rainier. The Rendezvous was first released in 2001. Rendezvous sales during 2002 and 2003 (its first full years of production) were 61,468 and 72,643 units, respectively. So at this rate, the Enclave is actually selling in lower numbers than the sales that were generated by the vehicle that it replaces during its first years of production. Many Rendezvous went to fleet sales, so it is possible that the retail sales figures will turn out to be similar, but obviously, the Enclave is not providing a huge sales surge for GM. Meanwhile, overall Buick sales are falling, so it doesn't seem to be helping the brand, either. The point being made here is that Enclaves are not flying off the shelves, they just don't have that many on the shelves. Whether GM is generating more profit per vehicle sold on the new model, I don't know, but we do know for certain that they aren't selling in large numbers. And when you compare it to the sales volumes of its competitors, it's selling at half the pace of direct rivals such as the Lexus alternative, which helps to explain why this supposedly hot commodity makes only occasional appearances in your neighborhood.
Blister, I think you may have hit on the heart of the problem. Few of us here have any faith that the right person was blamed by the board for this problem. We have a product that is NOT selling near enough copies to meet the goals (we can only assume what the goal should have been since they won't tell us). If they were having a problem meeting demand for some number ABOVE what would be a home run hit, this would not be an issue. However, they are not even hitting a double and they are running out of cars. The pro GM crowd all want to tell us how great a car these are, and how lame Toyota really is, but the skeptics are pretty sure that is not the point. The point is that little has changed at GM. There is no sign that we should buy the stock, that the turn around is coming, or that anyone over there is taking responsibility for anything. I am actually thinking it's time Maximum Bob opened his big mouth again. He should walk into RW's office and tell him, "It's you or me, pal". Anyone at GM who thinks they have the ability to lead the place needs to start trying to take charge or get out. GM is NOT a government, and continuing to play along is not living up to their responsibilities to the stock holders and employees.
Try telling that to the thousands of potential Enclave owners who are being forced to purchase from another auto maker because of these delays as well. There's no telling how many more of these would have sold had they not run into this issue. http://www.enclaveforum.net has lots of would-be Enclave owners talking about having to look for an alternative now.