General Motors is dropping the sticker price of its Buick Regal sedan as it tries to reverse sagging sales at the brand and counter a consumer migration to crossovers and sport-utility vehicles.
GM announced the new pricing strategy in a letter to Buick’s dealer council this week.
The brand told its dealers that the new prices will appeal to a broader range of buyers of midsize cars. “Ultimately, we’re giving our customers greater value without sacrificing the features they want.”
While the price of the lowest trim model remains the same, the sticker for the 2016 Regal GS, the fanciest model, drops to $34,990, about $3,300 lower than the 2015 model. Prices for other versions fall $1,000 to $2,500.
“We have to take a step back and make sure we have the basics right,” Duncan Aldred, who heads the Buick brand in the U.S., told the Los Angeles Times. “The Regal pricing was out of line.”
Buick sales have dropped more than 6 percent through the first half of this year even though the overall auto market in the U.S. is up more than 4 percent.
The Regal is leading the charge downhill.
Its sales are off almost 24 percent from the same period a year ago, to just 9,387. That’s barely 1,500 a month.
Buick’s other sedans also are fading. Sales of the full-size LaCrosse have plunged about 18 percent. The compact Verano is down 20 percent.
The brand has had better luck with crossovers.
The seven-passenger Enclave has lost almost 7 percent, but with sales of 28,070, it is still Buick’s second-best performer.
Buick’s sole success is the sub-compact Encore crossover. Sales are up 29 percent to 30,142.
“Buick is better known for passenger vehicles, and this shift toward SUVs has left them down,” said Jessica Caldwell, an analyst with auto information company Edmunds.com.
The Regal was a difficult sell because the well-regarded sedan — it is on Consumer Reports’ recommended list — sits between mass-market vehicles and luxury cars.
Attractive lease deals or small sports sedans from Mercedes-Benz and BMW and newer vehicles such as the Acura TLX left it little space in the market, Caldwell said.
“Even though it is a pretty good car, it is hard for a premium vehicle to compete,” she said.
What Buick really needs is a compact crossover that fits between its Enclave and Encore, she said. Lincoln, also a struggling brand, has had great success with its compact MKC crossover, Caldwell noted.
Buick, however, has time to make pricing adjustments and retool its U.S. lineup “because China is their primary market.” Caldwell said. “Anything they sell here is a bonus.”
Buick sold 919,582 vehicles in China last year and 228,963 in the U.S. It’s next biggest market was Canada, with sales of 18,745 vehicles.