Terrain to join GMC's Denali line
It's part of the brand's push to put more distance between itself and Chevy
DETROIT -- General Motors is expanding its popular Denali line of upscale GMC trucks to the brand's hottest vehicle, the Terrain crossover.
GM plans to offer a Denali version of the Terrain this year as a 2013 model, according to people familiar with GM's planning. Terrain sales rose 37 percent last year to 83,179, the biggest gain among GMC's seven nameplates.
A spokesman declined to comment on whether GM plans to add a Denali-trim version of the Terrain or other GMC vehicles.
The move is another attempt by GM to build on the success of the top-trim Denali line, a bright spot for GMC that GM global marketing chief Joel Ewanick calls "a brand within a brand."
For years, the Denali badge was found only on the GMC Yukon SUV, Sierra 1500 light-duty pickup and the Envoy SUV, which was phased out in 2009. For the 2011 model year, GM added a Denali version of the GMC Acadia full-sized crossover and Sierra heavy-duty pickups, the 2500 and 3500.
Ewanick: Denali aids conquests
The additions helped drive sales of Denali-badged vehicles up 79 percent last year and helped propel GMC's overall sales up 19 percent. The Denali line accounted for 15 percent of GMC sales.
Adding a Denali version also helped extend the life of the aging Acadia, which was launched in late 2006. Denali versions accounted for 28 percent of the 79,288 Acadias sold last year, helping the crossover to its best year ever. GMC is showing a reskinned Acadia at the Chicago Auto Show this week.
Ewanick says the Denali's strong brand recognition is helping GMC attract non-GM buyers.
"We see GMC as a real conquest brand for us, and Denali plays a big role in that," Ewanick said last month at the Detroit auto show. The Acadia and Terrain have GMC's highest conquest rates, at around 40 percent each, he said.
Denali versions generally offer the model's highest trim level combined with some cosmetic upgrades, such as its trademark honeycomb grille and larger, chrome-aluminum wheels. Yukon and Sierra versions also get a 6.2-liter V-8 engine, up from the 5.3-liter V-8 in other models.
"Denali" means "the great one" or "the high one," and is the indigenous name for Mount McKinley in Alaska. The Denali line highlights GM's long-running quest to move GMC up the premium ladder. For years, GM has sought to create more daylight between GMC and Chevrolet, which shares platforms across GMC's lineup.
'Specific to GMC'
At the Detroit auto show in January 1997, when GM showed its first Denali offering, on the 1999 Yukon, then-GMC brand manager Roy Roberts told Automotive News: "You'll see products start to evolve that are specific to GMC and very different from those at Chevrolet."
Fifteen years later, that's still a work in progress. Last year GM North America President Mark Reuss told Automotive News that he wants to "take GMC and move it even further up."
Said Reuss: "We've got a brand inside of GMC that can do it: Denali. We sell the heck out of that. I'd say that we continue to drive that thinking into GMC."
Dave Sullivan, a product analyst in Ann Arbor, Mich., for AutoPacific Inc. of Tustin, Calif., says extending the Denali name to the five-seat Terrain would help spur sales as the crossover gets deeper into its life cycle, which began in the 2010 model year. It also would help separate it from the Chevy Equinox, its platform sibling.
"Denali is a trim level, but it's really set that line apart" from other automakers' high-end truck offerings, Sullivan says. "To me, that premium status is really what GMC should be all about."
GM won't disclose the conquest rate for Denali vehicles. It says most buyers are coming from other GM cars and trucks. Still, it draws a more affluent customer base. Last year 45 percent of Acadia Denali buyers had average household incomes of more than $100,000, compared with 34 percent for buyers of other Acadia trim levels, according to Edmunds.com.
Chris Haydocy, owner of Haydocy Buick-GMC in Columbus, Ohio, says the Denali name is popular with general contractors and architects. The line accounts for about 20 percent of his total sales, even though he has trouble stocking enough.
Adding a Terrain Denali "would be a breakthrough, because we'd be the first to market with a really upfitted crossover," he said. "It makes perfect sense."
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