Read Company Case 15 (Buick) on pp. A28-A30 and answer Questions for Discussion at the end of the case.

Questions for Discussion

1. Does Buick have a truly global strategy, or just a series of regional strategies? Explain.

2. Do GMs global manufacturing facilities, such as Shanghai GM, solidify a global strategy? Why or why not?

3. What is Buicks global strategy in terms of the five global product and communications strategies?

4. Can competitors easily replicate Buicks strategy in China? Why or why not?

5. Based on Buicks goals as discussed in the case, what do you predict for Buick in the coming years in China? In the United States?

"Buick owners are mostly the leading men in China." Over the years, Buick's image as the vehicle of choice people. As China's market economy began to take off in the late 1900s, its exploding middle class fueled the demand for cars. Buick was poised to ride the trend to the top. In 1997 , GM formed a joint venture with Shanghai Automotive Industry Corporation-Shanghai GM-to build GM cars in China. The first Chinese-made Buick rolled off the assembly line in 1998 Shanghai GM would go on to become the first Chinese auto year. Around that time, Buick enjoyed a brand familiarity rating of more than 85 percent in China. An Evolving Global Strategy For decades, GM's international marketing strategy was largely characterized by exporting products made for the U.S. market. In GM's thinking, what worked in America would work globally. This included selling left-hand-drive cars in rightmade sense at a time when the United States was far and away the biggest car market in the world and GM was selling far more cars in the United States than anywhere else. But U.S. automotive sales matured years ago at a time when growth in other markets took off. China is now the world's larg- est passenger car market, and with over 1.3 billion people, it has a way to go before the market is saturated. Fortunately for GM, Buick had rubber on the road in China before that market started accelerating. When the Chinese market took off, GM put things into overdrive. As a result, GM sold 2.35 million cars in sold more cars in another country than it did in the domestic market. That also marked the sixth consecutive year for GM as China's number one automaker. As GM's overall growth dynamics shifted, Buick was ahead of the curve. The year 2000 was one of Buick's best years ever in the United States, with sales of more than 400,000 vehicles. But that began a steady and steep decline for the brand. As GM worked its way through the recession, bankruptcy, and a government bailout, it considered eliminating Buick entirely. But in China, Buick sales were rising as fast as they were sinking in the United States In 2009 , the same year that Buick's U.S. sales hit an all-time low of just 102,000 units, the brand sold 450,000 cars in China. No toubt about it, China saved Buick from the fate that befell interior. With Shanghai's trendy clubs in mind, Qui stated, " looked at where people lived, where they hung out, and then tried to create that same feeling inside the car." The result feels more like a beautifully designed living room than the stoic in- teriors common to other Buicks. Soft buttery-colored ambien light glows from the instrument panel as well as from hidden lights in the rear. The front and back seats are well-padded and feature power massage. PATAC's LaCrosse sold more than 110,000 units in China during its second year of production. That's more cars than The LaCrosse was instrumental in pushing Buick's 2010 total Chinese sales to 550,000 units. "Our LaCrosse pushed the expectations," says Raymond Bierzynski, president of PATAC. "Our Buick is what the brand wants to be everywhere in the world." The move to incorporate PATAC's designs into a vehicle that would sell in all of Buick's markets signals that GM is recognizing that the world is bigger than North America. PATAC is taking the lead on creative strategy. "We aren't the "China commands 8 million units a year. We're GM's [biggest] market. We are the experts." The big question is this: How will Chinese-influenced designs be received in the United States and other markets? While States as it is in China, 2010 was Buick's best year in the United States in over a decade. Total sales increased by 52 percent over stream car brand in the country. Perhaps more important are changes in consumer perceptions of the brand that indicate the potential for future growth. while purchase consideration went up 65 percent. That's not al because of the LaCrosse, mind you. But it is worth noting that automotive journalists gave PATAC's redesign rave reviews. three finalists for "Car of the Year." The magazine proclaimed it, "Easily the best Buick sedan in a long time." The outcome of PATAC's LaCrosse has earned the design that will sell in multiple world markets. Buick will be introducing 12 new models to China in the near future as GM has its sights set on big targets. Its goal is 5 million vehicles, with Buick accounting for more than 1 million of that. Ford is struggling to break 500,000 units in China some financial analysts aren't so optimistic, estimating that GM will grow to only 3.3 million units in China by 2015 and will actually lose market share in the rapidly growing Chinese market. Whatever the outoome, it's clear that Buick is a global brand with momentum in the right place. Questions for Discussion 1. Does Buick have a truly global strategy, or just a series of regional strategies? Explain. 2. Do GM's global manufacturing facilities, such as Shanghai GM, solidify a global strategy? Why or why not? Sources: Jens Meiners, "Ford and GM Battle for Sales in China," Car and Driver, September 2010, accessed at www.caranddriver www.gmblogs.com; Fam Wamer, "Made in China," Fast Company, "Buick Sales in China Surpass 3 Million," May 2011, accessed at