GM’s new models key to its future
Buick Regal, Chevy Cruze must sell big, experts say
DETROIT – Two General Motors cars due in showrooms next year must be hits to help the automaker turn around sales and pay back its big debt to U.S. taxpayers.
The Buick Regal midsize sedan and Chevrolet Cruze compact, both sold in key segments of the U.S. car market, face stiff competition and other obstacles to success.
GM was to roll out the Regal today in Los Angeles, and it’s counting on the sleek-looking sedan to claw out a new market for the once-stodgy Buick.
Buick has been absent from the tough midsize market since 2004, while the Cruze was recently put on hold because GM wasn’t happy with how it drove.
Executives have high hopes that the Regal, much of it designed by GM’s Opel engineers in Ruesselsheim, Germany, can help bring younger buyers to Buick. Currently the median age of a Buick customer is around 68, but GM is targeting new models for those in their 40s and 50s, said Craig Bierley, Buick’s product marketing director.
“Clearly having a midsize entry is absolutely critical for us,” Bierley said.
Buick sales so far this year are down 33 percent compared with last year, worse than the overall U.S. market, which is off 25 percent.
GM has no margin for error with the Regal or any other new vehicle, said David Koehler, a clinical marketing professor at the University of Illinois at Chicago.
“Their success in the future is riding on these new launches,” he said.
The Regal is designed to compete with the sporty Acura TSX, made by the Honda luxury brand, and the Volvo S60.
Koehler said even more is riding on the smaller Cruze, which must sell in larger numbers than the Regal because of its lower profit margins. The Cruze will be targeted at younger entry-level buyers as well as those seeking fuel economy. It’s supposed to get around 40 mpg on the highway.
But GM postponed the Cruze’s April build date about three months, said Mark Reuss, GM’s vice president of global vehicle engineering.
The company, he said, wasn’t happy with the Cruze’s performance, especially with the six-automatic transmission.
“No one was thrilled with where it shifted, how it shifted,” he said in an interview.