Labor Bargaining Chip: The Made in China Buick Envision

GM and the UAW are at the negotiation table with both parties seeking the upper hand with the next labor contract. A new bargaining chip, a Chinese-built Buick Envision crossover, may give GM some leverage. Negotiations are expected to conclude in September.

GM sales are up nearly 4 percent through July, coming in slightly below the market’s 5 percent growth pace. Chevrolet and GMC combined are contributing to the pace, but the premium Buick and luxury Cadillac brands are down year-to-date, falling 3.1 and 2.4 percent respectively.

A highly competitive luxury market is one reason why both brands are down, but the most compelling reason is a lack of utility vehicle model lines. Buick has the diminutive Encore crossover and the large Enclave crossover, while Cadillac offers the compact SRX crossover and the king-of-bling Escalade SUV. On the other hand, the strongest mainstream and luxury competitors typically offer at least three or four utility vehicles (usually crossovers), providing more of the types of vehicles that customers want than what Buick and Cadillac presently offer.

Buick Envision

GM will rectify the crossover deficiency for both marques, but sooner with the Buick. That’s because the automaker has its eyes set on its Chinese manufacturing base to supply a midsize model, the Buick Envision. The new model may appear stateside as soon as next year, despite strong opposition from the rank and file.

Indeed, the UAW has said that it opposes GM importing the Envision, a model the automaker could build in the US. The union and the automaker are currently negotiating in a bid to hammer out the next four-year labor agreement. GM’s factory employees have not seen a raise in 10 years and are clamoring for a wage increase. At the same time, GM is hinting that more products may be imported from abroad with the possibility that some North American production could be shifted to Mexico, a NAFTA nation.

Importing the Buick Envision comes on the heels of Trans-Pacific Partnership (TPP) ratification in July. The TPP seeks to lower trade barriers, including tariffs, what union leaders have argued would be poorly enforced and lead to job loss. Importing the Buick from China would mean that American workers would not have the opportunity to build the vehicle, resulting in a loss of job opportunities.

GM, however, cannot delay for what would likely take much more time to build the Envision in North America and at a greater cost too. The tooling and suppliers are in place in China, and the crossover would only need to be modified to meet current American safety and emissions testing requirements. Some changes might also be handled at the port of entry.

Buick Envision

Although GM has not publicly committed to bringing the Buick Envision to US, the company is pleased that this model has caught on so well in China where it went on sale just over a year ago.

That US media sources are reporting on the vehicle possibly heading to the US also gives GM some leverage as it prepares for contract talks in September.

Specifically, GM has a few scenarios in mind for how they want the labor talks to proceed. The Buick Envision may be held as a bargaining chip as the UAW wants to both expand jobs and procure raises.

GM, however, will continue to point to the labor advantage enjoyed by its foreign competition, specifically manufacturing plants in the southern United States owned by Mercedes-Benz, Hyundai, BMW, Kia, Toyota, Nissan and others. Look for the two parties to come to an agreement this September where either the pay is raised or more jobs are created, but not both.

From a customer’s standpoint, the Buick Envision fills a void in the brand’s lineup. The crossover sits on a 108.3-inch wheelbase, and is 183.7 inches long by 71 inches wide and 65.3 inches tall. Those dimensions parallel the Acura MDX, one of several models the Envision would most likely battle.

The Chinese-spec model is powered by a turbocharged, 2.0-liter four-cylinder engine paired with a six-speed automatic transmission. Front-wheel drive is standard; all-wheel drive is optional. A second powertrain choice, such as GM’s 2.5-liter four-cylinder engine used in the Chevrolet Malibu and Impala might also be considered. It is a normally aspirated engine at that.

As for bringing the Envision to the US, Buick spokesman Nick Richards told CNN, “It is all speculation at this point. To this point we haven’t disclosed any plans for it outside of China.”

Buick Envision photos courtesy of General Motors Company.

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