Re-badged vehicles can often offer a company a new brand identity or a supplement to a product line without having to invest in the cost of designing and producing a completely new car.  This strengthened brand identity can help market other vehicles within the re-brander’s existing product line.  Re-badging also gives automakers the ability to up- or down-brand a vehicle’s identity as if it were a trim package for sale to different markets.  A prime example of this is Ford-Mercury-Lincoln, each of which carries a different brand identity, dealership network and prospective target market.  Ford designed and built the Explorer for its own target market, and gave it a starting price of about $18,000.  Mercury re-badged the vehicle to create the Mountaineer, an uptown brother of the Explorer starting at about $25,000.  Lincoln took the Explorer and rebadged it as the Aviator, which was the most luxurious version of the three and began at almost $40,000.  Each company sold the same basic vehicle, but utilized small design changes and different marketing campaigns to sell it to their individual customer bases without creating 3 drastically different, expensive, and time consuming models.

Another reason for badge engineering has to do with borders, culture, and language.  Frequently vehicle model names and even brands don’t always sound as good outside their native tongue.  When this happens (and it happens surprisingly often), it’s much cheaper and easier to change the chrome logos than to design a new vehicle.  The Buick Lacrosse, which sold well and without problems in the U.S., had to be renamed for the Canadian and more specifically the Quebec markets.  Why? Because depending on the dialect, “Lacrosse” was a French slang term for either “masturbation” or “swindler”.  The Mitsubishi Pajero had the same issue.  “Pajero” in many Spanish-speaking countries means “wanker”, and so we know it today as the “Montero” in the U.S. or as the “Shogun” in the U.K.

Beyond the naming and marketing issues, there are strong bottom-line incentives to a company rebadge a vehicle.  When GM looked to Toyota for smaller, more fuel-efficient cars, they could already see a successful track record of reliability, low cost of ownership, and an established parts supply network.  When car manufacturers are looking to create a new production vehicle, costs can be in the hundreds of millions to build and tool new factories.  So, GM saved money, time, and difficulty by simply plugging in the Toyota vehicles into its existing structure with minor changes.  However, problems may appear if a company chooses to align itself with a company that doesn’t have the same perceived (or actual) quality or reliability.  If you are marketing your vehicle line as “reliable” and choose to bring something into the fold that isn’t, customers may become confused or upset if the new addition doesn’t live up to the hype.

For example, when GM tried to bring an entry-level car to their Cadillac lineup they chose the Chevrolet Cavalier as a platform, and thus was born the Cimarron.  However, the Cimarron sold in 1988 for $16,071, while the Chevy-branded original was selling at $6,995.  This was quite a price difference for what many critics harshly deemed little more than leather and nicer paint.  There may have been many technical reasons for Cadillac to base a new vehicle around Chevy’s “J” platform, but none of them seemed to make a $10,000 difference to consumers.  Total production in the 7-year run of the Cimarron was a mere 132,499 units.  Similarly the Acura SLX, an incognito Isuzu Trooper that provided the Acura brand with a quick entry into an SUV market that was rapidly becoming crowed, suffered seriously from mechanical problems and numerous recalls and was harshly criticized by Consumer Reports for its rollover rating.  All this hurt Acura, which had previously been seen as a reliable and safe “premium” brand not usually plagued by such problems, and which discontinued the SLX in 1999.

The reason for these re-badging failures is that both of these companies picked “cheapy” vehicles to plug into their product line.  In retrospect, it seems like this would have been a no-brainer for two companies that spent billions of dollars and decades of time building their reputation on quality, but the short-term allure of new customers without the expensive investment in new product can be a powerful temptation.  It didn’t pay off in either case, where both companies had to spend millions to help erase the damage.

What does this whole shell game mean to you, the new-car buyer?  It can either be good or bad, depending on how well you do your research before buying.  One possible downside is that the customer may be unsure of what vehicle they are actually getting when they buy.  Many consumers who buy based on national or domestic-production loyalties are probably surprised to find the “All-American” Pontiac Vibe was made by a Japanese company.  On the other hand Toyota’s solid reputation for reliability and value is reflected in the cost of their products, so by buying a Vibe you may save a few bucks on what is essentially the same car.  The best advice is to go forewarned and forearmed into any vehicle purchase.  Comparison shop, use the web, talk to dealers, and especially talk to us.  We can help guide you through the minefield of “brand-engineered” vehicles, and maybe save you some headaches as well.  To get you started, here are some car makers that have worked together in the past…

Isuzu and Honda        Honda Passport, Isuzu Oasis, Isuzu Gemini, Honda    Odyssey, Honda Civic

Ford and Nissan        Mercury Villager, Nissan Quest

Toyota and Chevy        Chevy/Geo Prism, Chevy Nova, Pontiac Vibe, Toyota Corolla, Toyota Matrix

Saab and Subaru        Saab 9-2/9-2x, Subaru Impreza, Subaru WRX

Mazda and Ford        Mazda B Series, Mazda Tribute, Ford Ranger, Ford Explorer

Mitsubishi and Dodge        Dodge Colt, Eagle Summit, Mitsubishi Mirage,      Dodge D50 Pickup, 3000GT, Stealth

Chevy and Suzuki        Chevy Tracker, Suzuki Vitara

Chevy and Daewoo        Chevy Aveo, Suzuki Swift, Daewoo Lanos (same   platform)

Volkswagen and Daimler     Volkswagen LT and Dodge Sprinter

Freightliner Sprinter =Mercedes Panel Van

Digging Deeper…

Let’s Take A Moment To Remember The Most Ridiculous Car Rebadging Of All Time, Jason Torchinsky in Jalopnik, Jun 2021

Record high new and used car prices continue in 2022, Robert Duffer in The Car Connection, Feb 2022