Cadillac U.S. Sales Increase 3 Percent To 15,368 Units In September 2016

Comments

1. 

   the XT5 is killing it and so is the CT6 considering its price and size. I think the new missing CUVs and next gen sedans will up sales to over 20k a month.
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   1. 

      I agree that Cadillac can turn a corner with only a couple more new products but I do not think that XT5 is killing it, yet.

      If you look at the 2015 SRX’s (which was 6 years old at the time) volume it was higher in September 2015 (6,849 units) and a higher 2015 YTD (50,712 units) than the current XT5 and remaining SRX’s whose combined September 2016 volume was 5048 and combined YTD is only 43484 units.

      That is down significantly. You would think that the volume would be higher since the new model is arguably better in every way than the old SRX.

      What gives?
      Reply
      1. 

         What gives are incentives. The SRX had more than the XT5 does in 2015, sometimes in a “stacked” fashion.

         I also have a suspicion that XT5 production in the U.S. and in China is currently at capacity, with the current production structure. It can be expanded, but not sure that either of the two plants can churn out more than 5,000 units a month.
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         1. 

            I should clarify my reasoning for the aforementioned XT5 production constraints. The second-gen SRX was not a big seller in China because it was not made there. Instead, like the Escalade, it was produced in Mexico and exported to China, resulting in hefty import taxes.

            Since the import taxes resulted in substantial price increases on the SRX, most of the units produced were allocated to the U.S. market. And, in my theory, since there wasn’t enough demand for the SRX in the U.S. at the original price, incentives were used to sell out the inventory. That’s a rough characterization of what I believe took place.

            The XT5 is now produced locally in China, barring it from any import taxes. The benefits are obvious, as the vehicle jumped to be Cadillac’s best seller in the market a few months following its introduction and launch ramp-up. Having a plant in China making XT5s for China (obviously) means that any North American plant no longer needs to support China demand/capacity for the vehicle. As such, I believe that the Spring Hill, Tennessee plant that assembles the XT5 for North America was planned to have a lower production capacity than the Ramos Arizpe, Mexico plant that produced the second-gen SRX for the world.

            In all, that’s my reasoning that XT5 production is at or near capacity in the current scheme of things.
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2. 

   The mid-size SUV is still a hot market segment and the XT5 is well positioned to become Cadillacs sales leader like the SRX was . It was the hottest selling Cadillac nameplate for September and will continue to sell very well . it may also help Cadillac increase it’s market share as that and TAP are both important .
   Now that the Lincoln Continental is out ( and it is nice ) we will have to see if it slows CT6 sales . Cadillac would be wise to a major refresh of the XTS to take on this battle since it is about the same size as the Continental .
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3. 

   Does New York Joe really think increasing sales and transaction prices are going to shift the perception people have? This clown gets his hand into two projects at the end of product planning and they happen to be performing well. Saved by the product again just like at Audi when Sales nearly doubled in his tenure.

   Why is cadillac still lacking in the booming crossover section? Sure they have vehicles planned for the future, but they are late to the party again. What was GM/Cadillac doing four years ago?

   Imagine how well sales would be doing if the New York move wasn’t a fail, if the Marketing was a fail, if luxury service plan at dealerships wasn’t a fail.
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   1. 

      To your points:

      Yes, increasing volume and selling more expensive models will help to shift perception. If potential customers see more of a vehicle on the road or more being driven by people in their peer group that will make the vehicle more attractive. Human nature is to be part of a group and not be the outcast.
      Also if most of the models they see are the pricier versions that will also help to sway perception.
      JnN’s product influence is not being felt yet because he hasn’t been here long enough.
      You can judge his success or failure in the next 3 to 4 years when the new models hit the ground, the dealership re-organizing is in place and a marketing push has had a chance to take effect.

      Cadillac is not in the booming crossover space because 3 to 4 years ago they underestimated it’s future importance in the marketplace. Yes Cadillac is late to the party and yes they are trying to catch up quickly.

      The N.Y. move has no bearing on sales right now. Blame the lack of crossovers or the reduction in fleet sales for the lower US sales numbers but JdN does not get that blame yet.
      The luxury service plan (Project Pinnacle) is not in place yet so there is no blame there and if anything it should help not hurt.
      Marketing could be better but you can not ‘market’ what you do not have (read- more crossovers).
      Reply