Don’t Freak About About Buick Importing a Crossover from China
Buick has heard a great deal of criticism in recent weeks for its decision to import the Envision crossover from China. Namely, US labor unions are averse to the idea of potentially losing American manufacturing jobs in favor of importing goods. However, it may not be the cause for panic that so many want to make it out to be.
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Detroit Free Press’ Mark Phelan hits the nail on the head in his article, “Why Buick is right to import the Envision from China.” He points to, specifically, the fact that annual sales of the Envision are likely to total 150,000 units in China and between 40,000-50,000 in the United States. The most pressing bit:
The economics of production don’t justify building it in two places at that level, and it makes more sense to produce it in China, where Buick sells 80% of its vehicles and builds 75% of Envisions. GM’s North American SUV plants are running flat out, and the Envision’s engineering is different enough that it’d be tough to build alongside a Chevy Equinox or GMC Terrain even if GM weren’t already struggling to meet demand for those SUVs.
Indeed, if the Envision’s biggest market is China, it makes no sense for Buick’s bottom line to build in America and ship 75% of its product overseas. Imagine if 80% of all Corvettes built in America were purchased in China; wouldn’t it simply make more sense to manufacture the vehicles in the most cost-effective manner possible? It is simply not a viable or responsible strategy, and GM’s product lineup is more than capable of keeping jobs in America.
“Buick’s center of gravity has shifted,” said IHS Automotive senior analyst Stephanie Brinley. “We will see more Buicks imported, from China and elsewhere, but GM’s North American production is largely staying here.”
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News Source: Detroit Free Press