Will a brand new model help boost Cadillac’s slipping sales numbers? CNBC’s Phil LeBeau reports on the key efforts General Motors has in place to revive Caddy sales.
Cadillac is hoping to shake thing up – quite literally – with the launch of its new flagship sedan.
Dubbed XTS, it's equipped with a new "Driver Awareness Package" that can spot a car hidden in the blind spot, sense when the driver is inadvertently slipping into the adjacent lane or if there's a potential for a collision with the car ahead. Rather than flashing lights or sounding a buzzer, the sedan's driver's seat will begin to vibrate.
But Cadillac also intends to shake up the established order in the U.S. luxury market. There was a time, not many years ago, when the General Motors brand overwhelmingly dominated its competitors, both import and domestic. Today, Cadillac is little more than a second-tier also-ran at home, and all but forgotten overseas.
"We intend to regain our mantle as the standard of the world," said Don Butler, Cadillac's vice president of marketing, during the first media drive of the new XTS, "and we think we have the credentials to do it."
The XTS effectively replaces two outgoing Caddy models, the STS and DTS. But perhaps more importantly, it's part of a wave of new products that the GM division promises to roll out in the coming years. The big sedan goes up against the likes of the BMW 5-Series and Mercedes-Benz E-Class. The new ATS, which will launch a bit later this year, targets the like of the BMW 3-Series and Audi A4.
Butler broadly hints that Cadillac will move even more up-market in the not-too-distant future with a production version of the Ciel concept car that drew raves on the auto show circuit earlier this year. An updated prototype, according to sources, could be unveiled at next January's Detroit Auto Show.
Even then, Cadillac officials admit, their line-up will still be relatively thin compared to competitors such as Mercedes. The German maker now offers a score of coupes, sedans, convertibles, crossovers, sports cars and SUVs.
While Caddy doesn't intend a one-for-one match, it is likely to continue rolling out at least one all-new model annually for the foreseeable future, GM CEO Dan Akerson announced during an appearance at the Beijing Motor Show in April.
"They're still a work in progress," said analyst Aaron Bragman, of IHS Automotive. "But their share will grow simply by entering new segments."
It's not the first time Cadillac has hoped for a turnaround. It began a much-ballyhooed "renaissance" a decade ago with the launch of its first-generation CTS sedan. That introduced the maker's so-called Art Science design theme, an edgy look that vaguely harkened back to such distinctive and dominant Cadillac offerings as the huge-finned '59 Eldorado.
But a series of subsequent products, such as the short-lived XLR roadster, fell short of expectations, the revival all but running out of steam with the STS and DTS.
Cadillac began to put things back on track with the launch of a second-generation CTS, especially when it pulled the wraps off the CTS Coupe, among the most distinctive offerings in today's luxury car market. And it beefed up its performance V-Series, the latest CTS-V one of the most powerful cars on the market.
The CTS will remain a centerpiece of the Cadillac line-up, though the next-generation sedan will grow slightly larger, to better position it between the compact ATS and full-size XTS. Meanwhile, sources reveal that at least one more crossover-utility vehicle is in the works as a supplement to the current SRX model.
The SRX suggests Caddy could deliver some surprises. The original version was largely ignored but the recent update is now challenging the long-time leader in the segment, the Lexus RX.
Like its competitors, meanwhile, Caddy is putting an increasing emphasis on technology, including not only the new Driver Awareness Package but also the Cadillac CUE system. Unlike competitors' infotainment systems, CUE permits a motorist to give commands – such as pairing a smartphone or entering a destination – in plain English, rather than having to learn a complex hierarchy of rigid commands.
But commanding U.S. buyers back into the showroom is another matter entirely. As recently as 1990, Cadillac routinely expected to sell a quarter-million vehicles annually. Last year, that was down to barely 152,000, barely two-thirds the volume of key rivals like BMW, Lexus and Mercedes. Worse, despite repeated efforts, Cadillac has largely failed to gain traction in the European market.
China is another story. There, GM is itself the dominant maker and Cadillac is rapidly gaining ground. Analysts like Bragman believe it will do even better once it begins producing models like the XTS there later this year, sidestepping hefty import tariffs. CEO Akerson told reporters during the Beijing show that his goal is boost Chinese Cadillac sales to 180,000 a year within a half-decade.
There was a time when Caddy defined the breed. The very name, Cadillac, showed up in the 1913 edition of Webster's dictionary as the definition of the ultimate in perfection – something the maker emphasized with a copy of the dictionary on display in Beijing.
While the term is still in use, it's been a long time since Cadillac was seen as the pinnacle of the luxury car market. But not for lack of trying. After its 2009 bankruptcy, GM is intent on regaining its broader global leadership and it needs Cadillac to be the simple of that resurrection.
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