By Chris Haak
09.25.2007
GM announced today that it has signed an agreement with Shanghai General Motors, one of its joint venture partners, to sell at least $800 million worth of sport utility vehicles and related parts and accessories in China under its successful Buick brand there. Of course, the only sport utility vehicle that Buick builds in the US is the new Enclave Crossover, and the deal calls for GM to export up to 25,000 Enclaves over four years, beginning in 2008. Also, the Enclave is arguably the only US-based Buick that does not already have a superior counterpart sold in China (the LaCrosse in China is a much more upscale, modern vehicle than the US version, and the Park Avenue in China is more luxurious, powerful, and modern-looking – not to mention rear wheel drive instead of front wheel drive than the US Lucerne.)
This deal comes on the heels of a deal that GM signed in May to export more than $700 million worth of Cadillacs from the US to China, bringing the total dollar value of GM’s US exports to China to over $1.5 billion.
Moves like this aren’t going to reduce the enormous trade deficit that the US has with China in any significant way, but it’s nice to see some “Made in America” products being sent to China, rather than the usual direction. Now, my only complaint is that China literally gets the “best of the best” in terms of the global Buick offerings. They have better cars than the US Buick lineup has, and now will also receive the US market’s superior crossover.
There has been some speculation that the timing of the announcement was intended to “throw a bone” to GM’s striking UAW workforce, showing that the company is doing what it can to find work for their assembly plants – and job security for their workers. Whatever the timing or motivation behind it, it’s nice to see GM talking more about sending vehicles to China rather than sourcing them from there, as Chrysler LLC has confirmed and Ford is rumored to be considering with its upcoming Fiesta.
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Maybe GM should just move all their production overseas whether it’s China, Mexico, Russia, etc. The UAW Can chew on THAT bone.
kipisthebest, the article is about how they are going to sell US-built Enclaves in China. What does that have to do with moving production overseas?
I find it so funny that the Chinese love Buicks so much. It’s like BizarroWorld.
Anonymous, I think two factors contribute to that: they didn’t get the crappy Buicks of the 1980s and early 1990s, and then when they finally did get Buicks, they were better than the ones sold in the US. With the exception of the Enclave, I think you could take any piece of Buick’s Chinese lineup and it would sell better in the US than Buick’s current US lineup (assuming the pricing was similar).
It is kind of weird to see, though.
This does seem to be very good news for GM! Also, I like how you made note of Chrysler and Ford’s rumored use of sourcing parts/cars from China and contrasted it with GM’s exporting of cars to China. If this is really how it ends up working out, I would think that alone would go a long way towards improving GM’s image with people concerned about American jobs and make them take a longer look at GM when shopping for a new vehicle. Of course, it would be great to see those better Buicks here too though.