As part of its plan to "balance supply against demand," GM's laying off workers at their the Lansing, Michigan plant. That's where The General builds its new Lambda CUVs: the Buick Enclave, GMC Acadia and Saturn Outlook. The triplets are this year's "save the company" vehicles– at least until the Malibu hits the streets tomorrow. If you listen to GM's spin, demand for the crossovers is booming! But if they're selling them as fast as they can ship them, why are they cutting an entire shift at the only plant that's building them? Why to keep supplies low to keep residuals high! Alternatively… So far this year, GM's sold 91,412 of the large crossovers. Of those, the Acadia accounted for 52,857 units, the Enclave racked-up 12,726 sales, and Saturn shifted 25,793 Outlooks. GM likes to brag that at the first of October, they had only a 21-day supply of Enclaves and a 49-day supply of Acadias. But– and they don't talk too much about this– they had enough Outlooks to last 73 days. Uh oh. Buick actually has a smaller supply of dead-in-the-water Lucernes on hand than Saturn has Outlooks. Maybe things aren't quite as rosy in Lambda-land as The Wall Street Journal and others are painting them.
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Spin lives.
Lowering production is a great idea, but we all know why this happened: the UAW is (somewhat) out of the picture and GM’s market share is in the crapper.
As the WSJ pointed out – pretty clearly for me – the intent of keeping the supply low is to NOT repeat the same mistakes they have made in the past, namely overbuilding a model that is currently "hot" only to end up with a 155 day supply on the lots of GM dealers when the model cools (aka – the HHR).
It’s weird, everywhere you turn you hear about the hot-selling lambdas, etc., but I don’t see them around as much as the good press would indicate. Regardless of the true reason, it’s a good thing they aren’t trying to just flood the market with a good car, lest it become rental fodder. Occasional job cuts and production slowdowns are good things for the Big 3; overproducing hasn’t gotten them very far.
Lambda sales are up to 107,954 as of today – October sales press release is now out.
100,852 Highlanders YTD, on the other hand, doesn’t even garner a mention in Toyota’s press release.
Aura 10/06 (4,661) outsold Aura 10/07 (4,425). Spin cycle it is.
The Saturn Outlook has not had much of an advertising/marketing campaign. It seems that Saturn is still concentrating on the Aura and on the new Vue CUV. And now I’m starting to see print ads for the new Astra. Saturn just doesn’t readily pop into one’s mind as a place to go to buy a large CUV.
I wonder if the Saturn’s fixed pricing policies might be hurting the sales of the Outlook. Theoretically, the GMC dealer down the street could be offering what is essentially the same vehicle at a slightly lower price.
GMis4GoodManners :
“As the WSJ pointed out – pretty clearly for me – the intent of keeping the supply low is to NOT repeat the same mistakes they have made in the past…”
Yes well, the problem here is not lowered production. It’s the fact that the WSJ quaffing GM Kool-Aid when it calls the Enclave a “hit” and a “break out hit.”
Thanks to the UAW contract, GM’s vehicle supply can more closely match demand– as we predicted it would– but the real story is that demand ain’t so hot.
Year-to-date:
Lexus RX 75,527
M5 24,318
M-class 23,960
XC-90 23,471
Enclave 16,482
Perhaps slapping “Oldsmobile Bravada” badges on the Outlook would make it a hotter item. Oh, right…
Well sales figures are one thing, but I have yet to hear about Detroits’ profits for the 3rd quarter. Did everyone just forget about making money and figured it doesn’t matter anymore????
GMis4GoodManners :
The WSJ article is overselling the strength of the Lambdas (IMO) but this quote throws a monkey-wrench in the mix:
And while the Enclave and the Acadia are hits for now, that could change in 2008 when GM begins building a Chevrolet version of the same vehicle, called the Traverse, at a plant in Tennessee. Because Chevrolet sells far more vehicles than Buick or GMC, the Traverse could very well pull buyers away from the Enclave.
GMC and Saturn are screwed. It never changes.
The Lambda platform makes a fine CUV. I recently looked at one, and I liked what I saw….except the sticker. Almost 40 large for a GM mini-suv? That’s crazy talk. That’s right where the BMW X3 (smaller, but more fun) lives and a few thousand away from a base Porsche Cayenne (way more fun). That’s some high-falutin territory to compete in.
The Lambdas need to be priced $8,000 less to make them really move.
-ted
also:
MDX 47,809
MKX 30,737
Anyone who has looked at the price tag knows why the Outlook isn’t selling. $35K for a Saturn? Have they lost their minds? If I’m going to drop 35K on an SUV (don’t give me any CUV BS) it sure as heck won’t be on a Saturn.
Before you call me a brand snob, my daily driver is a 2002 Saturn SL2 that I purchased a few months ago. For $400.00. Yes, that is correct, $400.00 total.
What’s next, Volkswagen making a $70K car? Oh yeah… how did that one go?
These hulks are overweight and overpriced. 2.5 tons if I recall correctly, and with oil goosed to $95/barrel, this is going to be a tough sell going fwd.
Many of the folks driving these things should be driving sedans anyway.
I think it is shallow anaysis to lump all of the Lambda’s together—they must be looked at seperately for proper analysis.
For example to list the Enclave as a failure when it just starting hitting showroom floors in late June is not really accurate. Said another way, using YTD figures vs. competitors that have been selling since Jan 1 just isn’t apples to apples comparison. From all indications—the Enclave is doing well and does not stay on the lots very long. People are willing to pay $35K + for a Buick (and for that matter a GMC Acadia).
The Outlook however is another story. IMHO…there aren’t too many folks willing to part with $30K + on a Saturn…especially with a non-negotiable price. I wish it were different…but it is not.
Last..to Starlightmica…the MKX will finish the year at least +20% vs. expectations. I had never seen a goal to outsell the MDX—besides—apples to oranges as the MDX is postioned as a 3 row vehicle where the MKX is 2 row.
“Many of the folks driving these things should be driving sedans anyway.”
Enclave 16/24
Camry 19/28
I’ll take the extra space, thanks.
While I would personally never own an Enclave (I simply have no use for such a huge vehicle, and I'm anti-SUV by nature), I think it is a very beautiful car and reminds me of the huge Buick wagons my dad used to own, only more modern (and without the fake wood panels on the sides). And call it PR spin if you will, it's one of the best vehicles they've built in a very long time. How about giving credit where credit is due?
Robert Farago states:
Year-to-date:
Lexus RX 75,527
M5 24,318
M-class 23,960
XC-90 23,471
Enclave 16,482
And, as pointed out by others, all but the Buick have 10 months of sales data versus 4 for Buick, so, if you take 40% of the above numbers (and that’s being generous):
Lexus RX = 30,210
M5 = 9,727
M-Class = 9,584
XC-90 = 9,388
Enclave = 16,482
How’s them for numbers. Only the RX beats the Buick, and Buick has made it clear it’s that Lexus is it’s target.
Put the Highlander and RX sales together and Toyota is wiping GM’s CUV butt. Things will get worse when the new Pilot comes out to join the MDX.
Of course, the GM kool-aid drinkers will be crowing that this is more evidence that GM has once again turned the proverbial corner, when in fact it hasn’t. Most are voting with their pocket books and that doesn’t involve GM.
I sure wish GM would pay attention here. These vehicles have potential for some folks (great legroom for example – a lost art it seems). However, as previous posts have indicated – how did they arrive at price structure? The Outlook is the cheapest of the three, but it’s way overpriced for what it is. I’m not impressed with the build quality, it’s ok but not outstanding, maybe a step up for GM, a Honda it’s not. (Don’t believe me? – go and play with the second row seat mechanism and check the plastic, not exactly finesse). Having said that, I would not eliminate it from consideration if their price point was adjusted downward. Finally, fifty-five grand for an Enclave? (Canadian $ now). Gimme a break.
The weighted average # days of inventory is ~47 days, which is pretty good. GM's decision to keep supply in check is wise, given that these are premium vehicles that don't need huge incentives to sell. Maybe a trend is starting.
Remember that 100K Lambdas probably = 400K Cobalts and 250K midsizes with regards to profit.
Plus the Lambdas are probably going entirely to retail customers.
Sales will go up, don’t worry, the cars are too good not to.
To the person who said they wouldn’t pay $35K for a Saturn; You don’t have to, you can buy the VUE for $21K or the Aura for $20K
The Outlook is $28555 and it is plenty good enough as a no option car for anybody.
kazoomaloo’s comment that he doesn’t see any Enclaves on the road is interesting to me, because I hadn’t really thought about “what I see lots of.” And that’s thought-provoking, because when I think about it, the cars that I find myself going “There’s one…there’s another…jeez, there’s another…” are Hyundais of several sizes, here in a county 60 miles north of Manhattan. Off topic, but what the hell.
Don’t get me started on Hyundai “warranty queen” Motors. Despite new models in virtually every segment they compete—October Sales are down. This flat / downward trend has been happening all year despite hefty rebates and inceased fleet sales. Apparently their “all new” product line isn’t so good.
Davey49: I said that $30K+ would be a tough sell for Saturn—not a reflection on the vehicle itself (which is pretty darn good) but more of a reflection of a brand that never had premium price equity and that GM drove into the ground.
“The Lambda platform makes a fine CUV. I recently looked at one, and I liked what I saw….except the sticker. Almost 40 large for a GM mini-suv?”
In what parallel universe is a vehicle that can seat 7 people and is in spitting distance of the Tahoe in every dimension and weight a MINI suv? Are you freebasing something? Like, right now?
The comparisons you draw are insane, too, by the way. The X3 is two size classes smaller and the Cayenne is one size class smaller – neither of them seat 8. Nobody in their right goddamned mind would cross shop those models…but they would cross shop it with a Honda Oddysey (same price range) and Toyota Highlander (ditto).
“Despite new models in virtually every segment they compete—October Sales are down.”
Every car maker has depressed sales right now. Context, what?
I’ve yet to see a single tv ad for any of these vehicles. They seem to be in a marketing black hole. Many a good car have died that way.
Sorry to be off topic folks….but…not every automaker was expecting and publicizing a potential “breakthrough year”…Hyundai was as they introduced virtually an all new product line.
And…every carmaker isn’t experiencing depressed sales. GM and Honda to name two have recently increased sales due to successful new product intro’s…..successful introductions that Hyundai has not had.
The next two years will be brutal for Hyundai—expect increased incentives and fleet sales.
GMis4GoodManners :
And, as pointed out by others, all but the Buick have 10 months of sales data versus 4 for Buick, so, if you take 40% of the above numbers (and that’s being generous)
Well, Enclave went on sale in April, so there’s actually 6 months’ worth of data. And adding the sales for each during those months, you get:
RX – 53,294
X5 – 17,003
M-Class – 16,566
Enclave – 16,462
XC – 15,630
How’s them for numbers.
Couldn’t have said it better myself.
My friend ordered an Enclave in March and was not able to take delivery until late June. While GM may have started Enclave production in April (http://www.wilx.com/news/headlines/6941727.html)….most dealers did not get any stock until mid-late June…and even then it was limited as there was heavy order demand that was filled first.
Any comparisons with other vehicles that had a full pipeline of inventory in their dealer system from Jan 1 onward is an apples to oranges comparison IMHO. Now….lets look at Aug-Dec figures in a couple of months—-that will be a fairer comparison that will be beyond dispute.
I think the Outlook is obviously the Mercury of this bunch. It will get some buyers but the majority will go to the GMC and the future Chevrolet model.
umterp85- you’re right about $30K for Saturn being a hard sell. Even $22K seems to be a hard sell. Saturn seems to have a reverse halo effect. They need to have a cheap car to get anyone in the showroom.
Brand wise, I perceive Saturn above Chevy/Pontiac and below Buick and Cadillac. I’m not sure what the point of the GMC Acadia was. I think of body on frame trucks and SUV’s when I hear GMC. The wrap around rear windows on the Outlook appeal to me more than the standard D-pillars on the Acadia.
As for reverse halo, I’m totally comfortable dropping into the Saturn dealership near me just to check things out. The other GM brand dealers give me bad vibes (although I’m curious about the new Malibu).
ChartreuseGoose – clearly all that matters in an SUV type vehicle is size. Forget driving dynamics, or luxury.
I was merely comparing vehicles in a similar price point. I would much rather drive a BMW or Porsche every day than a Lambda for similar dough.
Sure, if you want the most metal tonnage for your dollar, by all means, buy a Lambda (I did say I liked them – just not at that price).
OK, calling them mini-suvs might have been a bit of an understatement, but if all you want is seating and lots sheetmetal, a school bus might be the way to go.
-ted
LOL, did GM purchase WSJ?
I do not find the Enclave attractive at all but I am not over 50 or a GM employee!
The Enclave and all Buicks have the same design theme and it is not marketed toward the Lexus owner. The current Buick design theme attracts the 300C/Hemi/Caddy owner.
GM is holding back production of the Enclave to both screw the customer by inflating the price and manipulating the Buick as a “hot” car.
So, tell me how many of those Enclave buyers were former Lexus owners? That is the real gage of how “Hot” the Enclave really is not what GM/WSJ wants you to think.
umterp85:
Just posting a couple of more luxo-wannabe CUV YTD sales numbers, nothing more, nothing less. If you want me to predict something, how’s this: Outlook is a dead CUV rolling.
Enclave Oct/YTD: 4,244/20,726
Acadia Oct/YTD: 6,120/58,977
Outlook Oct/YTD: 2,458/28,251
Talk about sibling rivalry – Outlook sales are being outpaced by the more expensive Enclave. With minimal sales about to be squeezed by the upcoming Chevy Traverse next year, is it going to be worth it to GM to keep a low-selling nameplate around?
Saturn is a dead brand walking. I think we are seeing one last great hurray before it joins Oldsmobile. Remember all the class leading new products (or so it was said) that Oldsmobile got right before being shut down?
The time to revive Saturn was 10 years ago when it still had some momentum. Now the brand has been so tortured that the early brand-loyalists have all gone away and what is left of Saturn isn’t really a “different kind of car company” anymore. Now it is just another GM brand, ho hum. The only thing special is that you get to pay full price. Meanwhile Toyota and Honda are wheeling and dealing. The experiment with fixed priced car sales has been done, and it flopped.
The Saturn Outlook should never have been made. It should have been a Chevy. If is were, they wouldn’t be pilling up in the lots. The WSJ got snookered but good!
RX – 53,294
X5 – 17,003
M-Class – 16,566
Enclave – 16,462
XC – 15,630
In manufacturing context, all the above except Buick have vehicles on the ground and in the pipeline by the hundreds if not thousands.
Here in Houston I’ve seen a few Enclaves mostly in the west part of the city (money side), but haven’t seen one yet on a dealer’s lot. Apparently they’re selling as soon as they come in.
I still like the Arcadia’s style better…
starlightmica / jthorner: can’t disagree with your Saturn assessments including the suggesstion that Saturn should never have gotten the Outlook. Despite bringing some pretty decent product to market Saturn are not lighting the world on fire. HMMMMMM—-maybe they can now make GMC-Buick-Pontiac-Saturn combo dealerships and close standalone Saturn dealerships :)
BTW—early reads are that the Enclave is getting import conquests….it is doing very well.
A Toyota, Honda, and Nissan customer is quite comfortable going into one of those dealerships and finding vehicles priced from as low as $15,000 all the way up to a $40,000. The $15k Yaris has not determental effect on the sales of the top of line Avalon, Sequoia, or 4runner.
A top of the line CAmry which sells for over $30,000 does so because the buyers preceive (right or wrong) that it is a very good car for that amount of money. IF Toyota was to create another brand to slot in between Toyota and Lexus we would all say “What a stupid idea”.
My point is GM silly brand strcuture mean absolutely nothing to the majority of car shoppers that are not GM loyalist. Buick, Chevy, GMC, Pontiac, Saturn, and to a large degree Cadillac are all the same in that they are all GM products. If someone thinks on GM brand is crap they tend to avoid every other GM brand. GM is known as a maker of poorly built vehicles today. That is a sad reality that multiple brands will not overcome.
Once again we have the General attempting to sell up to 4 very similar versions of the same vehicle, yet no version reaches the top luxury level. So all 4 must compete on price against all of the established import competition as well as Fords new CUVs. GM is also off the mark by continuing to believe that Buick is Lexus competition. The Enclave is competition for the high-end Highlander not the RX. The RX competes with the Caddy SRX. (Why has no one listed the sales figures for the SRX?) The rest of the Lambda CUZ also compete with the Highlander and the rest is that class price range. IF anything the Enclave is an excellent competitor to the v6 SRX.
The Joke is that Toyota might possibly out sell all of the Lambda CUVs as well as the SRX with only two vehicles built off of the same platform. Even thought the Highlander and RX share no body or interior parts I bet Toyota’s cost for each will still be less than the cost of the Lamdbas. Nevermind the the fact that GM still have a to spend more $$$ on the SRX.
Think about it, at least 4 different wheel designs, 4 different front and rear bumper caps, 4 different interior designs, 4 different sets of exterior trim, different seats, different gauges, etc. Yet all share the exact same engine (where is that wonderful transverse 5.3l v8)and body! None of them do anything remotely different than the others! None have anymore off-road ability than the others. None have anymore towing capacity than the others. The driving dynamics are all the same.
So GM in betting that Americans just wants a vehicle that looks slightly different from 3 others that are essentially the same. Am I to believe that GM believe that after negative test drive in an Arcadia I will stop at the Buick Dealer for a spin in an Enclave?
IMHO none of GMs actions make any sense! They appear to be going in a different direction than the rest of the industry. WHile everyone else appears to be consolidating their production to lower cost GM is still spending an enormous amount of cash of stuff that just does not matter anymore. Sell four slightly different version of the same vehicle will NOT increase marketshare but continue the GM cannabalism that is so hurting that company. Each brand needs to compete with the outside competition and at the sametime somehow convince protential customers that their Lambda is better than the other GM Lamdbas.
To whatdoiknow1: Not much to disagree with in your post. If I was GM—-I would have only launched 2—the common man Chevy and the upscale Enclave.
Just saw an Acadia parked next to a Pilot while grabbing lunch.
The “CUV” Acadia dwarfs the “SUV” Pilot! WTF?! I bet you its bigger than the TrailBlazer, too! And the Explorer!
Who’s telling the truth on this one? Isn’t “8 Passenger CUV” an oxymoron? Should there be a limit to the size of a CUV? For instance: “CUV’s cannot be more than 50% larger than the founders of the category, the CR-V and Rav4.” Or: “Just because you lowered your SUV 3 inches and made the running boards standard does NOT mean your vehicle meets CUV guidelines.”