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Remarks by John Schwegman (US Marketing Vice President for Buick/GM) - 2011 NAIAS Buick Press Conference

2011-01-10

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John Schwegman (US Marketing Vice President for Buick/GM)

Good morning.

We're glad to have you with us.

We're very encouraged by the momentum of the Buick brand.

Let me give you a quick update on a few things that you may not be aware of.

First , Buick is now the fastest-growing automotive brand in the United States.

We finished 2010 with sales up 52% over the previous year.

For perspective... that propels Buick to fourth place among luxury brands...

now outselling brands such as... Audi, Infiniti, Acura and Lincoln.

We're also very encouraged that we're attracting new customers.

41% of all Buick customers were new to GM last year -- and a quarter of those came from an import.

Historically, Buick conquest rates only ran in the mid-20's.

(PAUSE)

Clearly, what's driving this momentum is our fresh new portfolio of premium cars and crossovers.

The Buick Enclave is a great example.

Heading into its fourth year of sales, Enclave, with its elegant and timeless design, continues to bring in new customers to the showroom.

More than 50% of Enclave customers came from a non-GM brand in 2010… with more import trades than ever before.

And sales finished up 28% to make it the best year yet for Enclave.

The LaCrosse, our flagship sedan, also remains strong with sales up 120% in 2010.

Continued enhancements are helping to build on its appeal.

LaCrosse was the first in its segment with a four-cylinder / 6-speed powertrain...

… the first with HiPer Strut technology...

…and it will be the segment leader in fuel economy when the 2012 LaCrosse with eAssist arrives this summer.

eAssist adds a small, but powerful electric motor and an advanced battery pack to the four cylinder engine.

This "light electrification" of a conventional powerplant provides an estimated 37 mpg highway -- the fuel economy of a compact in a full-size luxury sedan.

We'll be offering eAssist as our standard powertrain in LaCrosse next year… with the V6 available as a no-cost option.

Priced right around $30,000… LaCrosse with eAssist will be a smart value.

Especially when you consider that the Lincoln MKZ and Lexus HS hybrids both start north of $35,000.

For those that are more performance-oriented, the recently introduced Regal is the new sport-injected entry at Buick.

Customers began taking delivery of the Turbocharged Regal in December, and turbo models with the six-speed manual transmission start to arrive this month.

Towards the end of this year we'll bring back performance to the brand in a big way... with the 2012 Regal GS.

The GS offers everything you love about the Regal, plus a whole lot more.

It starts with the high-output Ecotec turbo producing 255-horsepower...

295 lb-ft of torque... and 0-60 performance in under seven seconds.

Plus there's the Interactive Drive Control System with Sport and GS modes... all wrapped up in a beautiful, sporty package.

And quality continues to be a cornerstone of the Buick brand, as witnessed by our Consumer's Digest "Best Buy" status for Enclave, LaCrosse and Regal.

And what you may not know is that all of our eligible vehicles were named "Recommended Buys" from Consumer Reports this year.

While we appreciate the recognition, we realize there is still plenty of work to do.

To extend the appeal of the brand to new customers, we will continue to expand the Buick portfolio with new offerings.

So it is more important than ever before that each new vehicle delivers on the Buick promise of luxury… refined performance… craftsmanship and beauty… all at a great value in the luxury market.

Our next new product brings all these attributes together in a compact package… making them available to a whole new set of buyers.

It will join Regal and LaCrosse as our third all-new sedan introduced in the last three years… and offer a fresh new entry to the Buick family.

That's why we are proud to introduce… the all-new, 2012 Buick Verano.

The 2012 Buick Verano...our first-ever compact luxury sedan…

We worked hard to make sure it is a Buick through and through.

It brings the sculpted design of today's Buick to a new size… with a refined and sporty profile, a bold waterfall grille, bright portholes, and projector beam headlamps with blue accents

The interior is finely crafted with rich leathers and warm woods… soft ambient lighting… and the most comfortable seats in the segment.

In fact, the leather seats are trimmed in the same premium leather used in our flagship LaCrosse.

Thoughtful amenities include an available heated steering wheel and heated seats.

Verano is also loaded with a long list of technologies that our customers will enjoy.

• Like the highly-advanced radio with 7-inch full-color monitor and touch-screen controls…
• It includes USB and Bluetooth…
• Satellite Radio…
• Plus, advanced connectivity that helps you get the most out of your smartphone applications... like Pandora – that streams your music right into Verano's Bose sound system.
• And, of course, OnStar... with turn-by-turn navigation, and its own mobile app that allows you to access vehicle features right from your phone.
• Like remote start and remote unlock...with no range limitations.

Of course, like all Buicks, Verano is also library quiet… and it delivers refined and responsive performance.

To fill you in on the technical aspects, it's my pleasure to introduce someone who was largely responsible for making LaCrosse and Regal

the cars they are today.

Here's the Executive Director and Vehicle Chief Engineer for the Verano…

Jim Federico.

JIM FEDERICO (Executive Director and Vehicle Chief Engineer for Verano)

Thank you, John.

Buick Quality is well known in the industry, and we aim to strengthen that reputation with the new Buick Verano.

We in Product Development believe a very important ingredient to Buick's Top Notch Quality Reputation is the level of quietness we design into every model.

And, the Verano will be no exception.

In fact, we believe when this is delivered to dealers in the fourth quarter of this year, it will be the Quietest Compact Sedan on the road.

Quieter than its very good European and Japanese competition, and

• Even quieter than some larger premium sedans
• Buick's Quiet-Tuning philosophy is simple:
• We first work to eliminate or Block all unwanted noise and vibrations,
• if we can't Block it, then we work to Absorb it,
• if we can't Absorb it, we then work to Reduce it.

When it comes to the execution, it gets more complicated, Very few areas of the vehicle have been left untouched by our quest for Buick Quiet.

Our Engineering Team has developed over 50 Buick Quiet enablers.

Let me touch on a few examples:

• All our new Buicks are built to the Toughest Body Shop Sealing Standards in the Company:
• In Verano's case, our Orion Assembly Plant, right here in Southeastern Michigan will have the honor of producing the quietest car in the segment.

As we have learned from our global development team, a Stiff Body is the foundation for a Quiet, Safe and Dynamic vehicle.

We continue to optimize Body Panel Damping via Clever usage of LASD, Liquid Applied Sound Deadening

Thick acoustic laminate glass is applied to the windshield and side glass,

Triple door seals throughout,

Multi-layer sound absorbing interior panels such as our 5 layer headliner

Suspension, Tires and Standard 17 inch Alloy Wheels are all developed to tougher standards to reduce road noise and vibration

We even optimized the steering wheel armature material and mass to dampen road induced vibrations and improve steering feel.

When it comes to powertrains, as with all our new Buicks, the Verano strives for a nice balance between performance and fuel economy.

We want you to have fun behind the wheel -- without regretting it at the gas pump.

The standard engine is the same as offered in the Regal and LaCrosse, 2.4-liter Direct Injection 4 cylinder with Variable Valve Timing paired to a 6 speed automatic.

It delivers approx 180 HP, 0-60time of approx 8 sec's, and 31 MPG or better on the highway

A little later we will add an enhanced version of the 2.0-liter Turbo Direct Injection 4 cylinder.

With both a 6 speed automatic and an optional 6 speed manual transmission.

This package will deliver great turbo performance while still achieving 30 MPG on the highway.

As with the new Buicks, LaCrosse and Regal, great ride and handling is key with the Verano.

We started with:

• A stiff body structure developed by our global team in Europe,
• Add our best-handling suspension available, including:
• MacPherson struts up front and
• Our GM-exclusive Z-link suspension -- GM patented combination of a torsion beam and watts link suspension in the rear.
• Then finished the job with Buick Refined Tuning delivering responsive, nimble handling with a smooth, quiet and isolated Buick ride.

We believe you'll be pleasantly surprised when you get the opportunity to drive the Verano and compare it to the competition.

Finally, as with all our latest Buicks, we expect 5 star performance with the latest tough US Safety Standards.

The Verano includes many standard safety features, such as:

• 10 air bags,
• StabiliTrak
• OnStar
• And much more.

OK, to finish up, we believe the Verano will be a welcome addition to the Buick showroom.

As the Midsize Regal is shorter, narrower and lighter than the Fullsize LaCrosse, the Compact Verano is shorter, narrower and lighter than the Midsize Regal

It is well sized Vs the key competition, And is ready to take on the more expensive offerings in the segment.

With that, I'd like to bring John back up on the stage to wrap things up.

JOHN

Thanks Jim.

As you can see, Buick is moving quickly from a niche player just a year ago, to a full-line premium brand in very short order… competing in all the core luxury segments.

With the Buick Verano, we're poised to play hard in one of the largest market opportunities.

When you combine the compact and compact luxury segments … it represents over 2 million sales, or 18% of the industry.

And we expect it to grow over the next few years.

And when you look at where these vehicles transact, there's a significant gap between compact cars like the Jetta… and compact luxury cars like the Lexus IS and Audi A3.

Positioned squarely in the middle of that gap, Verano is a smart choice in the compact luxury market… and a welcome addition to the Buick family.

Jim and I would be happy to answer your questions here today... with the help of a few of our key team members.

Dave Lyon, from Design...

Chuck Russell, from Engineering...

And Roger McCormack, from Buick Marketing.

Thank you all for your attention.