Look Outside US for Cue on Cadillac Sales

Jan. 7, 2016
Globally, Cadillac says, its sales increased 5.2% last year. Don’t rub your eyes. That’s not a misprint. Cadillac sales last year were, in fact, up a tidy 13,000 units.

It’s all about perspective and, here in Detroit, it’s sometimes difficult to see the woods through the trees.

For example, anyone can tell you Cadillac sales are on the skids. The cars, trucks and CUVs from the General Motors luxury unit are the best to ever wear the Cadillac crest, but the most expensive, too, and that has a lot of people opting not to pay big money for a brand that presently lacks the cachet of Mercedes and BMW.

As result, Cadillac deliveries in the U.S. finished 2014, a year that by any standard should have been a banner one with all of the division’s sexy new sheet metal, down 6.5%. Disappointing, for sure, and a hiccup in Cadillac’s comeback.

However, that perspective is a bit too narrow. Globally, Cadillac says, its sales increased 5.2% last year. Don’t rub your eyes. That’s not a misprint. Cadillac sales last year were, in fact, up a tidy 13,000 units.

Such perspective should also include the fact BMW and Mercedes each annually sell about five times the 263,697 units Cadillac delivered last year, so in the global luxury race the GM brand remains a minor player.

That should not diminish the year Cadillac turned in, though, where sales in China shot up a remarkable 47% on the introduction of the Cadillac ATS compact sports car and the XTS large sedan. If anyone thinks GM’s billion-dollar goal of selling 150,000 Cadillacs in China by 2016 is too ambitious, just look at the trajectory of 2014.

Cadillac sales also are up in Canada, Mexico, South Korea and the Middle East. If it weren’t for Russia’s new-car market implosion this year, Cadillac might have had a shot at a year-over-year increase there, too. And as for Western Europe, it will only take a long-awaited diesel powertrain to move the needle.

There’s more room for optimism in 2015. The brand’s V-Series line of high-performance models will hit the market in good numbers, and Cadillac finally will get a proper large sedan to compete with the Germans in the form of the CT6.

“Cadillac is both expanding and elevating globally,” Cadillac President Johan de Nysschen says in a statement. “In 2015, we will take many further steps to advance further globally.”

Those steps will include completing the move of its top executives, at least on the marketing and communications side, to Manhattan’s Lower East Side as Cadillac moves to become a separate business unit from GM. That’s a bit of perspective Cadillac, itself, needs to become a true global luxury brand, de Nysschen says.

“There is no city in the world where the inhabitants are more immersed in a premium lifestyle than in New York,” de Nysschen said in September.

“Establishing our new global headquarters in Soho places Cadillac at the epicenter of sophisticated living. It allows our team to share experiences with premium-brand consumers and develop attitudes in common with our audience.”

Finally, Cadillac’s pricing story needs to be put in the proper view. A Cadillac CTS costing upwards of $75,000 may seem a little rich, but the brand’s aggressive U.S. pricing strategy is paying off in higher average transaction prices.

According to Cadillac, the ATPs of its vehicles in 2014 grew to more than $47,000. That’s higher than BMW or Lexus, the brand claims. New people are shopping Cadillac, too, as 74% of ATS buyers came from another brand.

All told, the Cadillac comeback appears to be unfolding quite nicely, depending on how you look at it.

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