Sun sets on Buick’s Verano – Automotive News

Posted: Monday, May 09, 2016

DETROIT — Buick plans to phase out its Verano compact sedan in the U.S., a sign that the market shift toward crossovers has automakers rethinking the makeup of their vehicle portfolios.

General Motors rolled out a clean-sheet redesign of the Verano for China last year, but doesn’t plan to introduce a U.S. version as had been widely expected, according to a company source and another person familiar with the plans. The current U.S. Verano likely will run through a 2017 model year, the sources said.

The move reflects a new reality for Buick: With the success of its crossover lineup, its three sedans — the Verano, midsize Regal and large LaCrosse — are pulling a disproportionately light share of the load.

Buick expects as much as 70 percent of its U.S. vehicle sales to come from crossovers soon after the Envision compact goes on sale next month.

Deleting the Verano is a bet by Buick that it no longer needs a compact sedan as a gateway into the brand, a role that small cars have long played for mainstream and premium brands alike. At Buick, that mantle has been assumed by the Encore, a subcompact crossover launched in early 2013 that has fast become its highest-volume name-plate and No. 1 conquest vehicle. About half of Encore buyers are non-GM customers.

Still, Buick’s challenge will be to steer Verano buyers to the Encore or other options in the showroom.

“There were nearly 32,000 buyers who walked into a dealership last year and bought a Verano, not an SUV or a Regal,” IHS Automotive analyst Stephanie Brinley said. “Any time you eliminate a product from the lineup, there’s risk.”

A GM spokesman declined to comment on future product plans.

“We haven’t announced plans for a next-generation Verano and are focused on selling the one that we have,” he said. The car is built at GM’s Orion Assembly plant near Detroit.

The decision seems to align with the philosophy of global Buick chief Duncan Aldred, who took over the brand in 2014. Aldred has said he guards against spreading resources across too many light-selling nameplates. For example, he has hinted at U.S. sales expectations for the Envision of around 50,000 annually, which would far eclipse the Verano’s 31,886 tally from last year. 

“What we can’t have at Buick is 10 vehicles all selling a few thousand units each. I’ve seen that. It doesn’t work,” he said in a 2014 interview. “We need to bring in cars, trucks, whatever, that can offer substantial volume … and that are important for the dealers who will then buy them, stock them and spend marketing dollars on them.” 

The Verano isn’t that kind of car, said Chicago-area Buick dealer Mike Ettleson. 

“It’s a nice car,” Ettleson said. “But when gas prices are what they are, nobody is looking at them.” 

When the Verano debuted in late 2011, it was aimed at market “white space” as a premium small sedan that starts in the mid-$20,000s. That positioned it between a slew of less expensive mainstream compacts — think Ford Focus or Honda Civic — and luxury offerings priced north of $30,000, such as the Lexus IS 250. 

At the time it offered some goodies that most mainstream cars didn’t, such as a heated steering wheel. But recent redesigns of the Civic, Chevy Cruze and others have equaled or surpassed the Verano on features and refinement, Brinley says. And today, a buyer with a budget in the mid-$20,000s has many more crossover choices, too. 

At Martin NeSmith’s Buick-GMC showroom in Claxton, Ga., customers would rather pay less for a similarly sized Cruze, for example, or spend about the same amount for a crossover than spring for a Verano. 

“The Verano might be just a little too upscale for a vehicle of that size,” NeSmith says. “For not much more money, customers can get an SUV.”


Write a Reply or Comment:

Your email address will not be published.*