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Why The ATS Will Pay Dividends To Cadillac For Years To Come

Yes, the Cadillac ATS is one hotly-anticipated vehicle. From its perfectly-balanced chassis, wide array of high-technology features, and elegantly-aggressive styling that all add up to an entertaining driving experience, the ATS looks to be a winner now, and into the future.

Now, since most luxury car sales take place in the über-competitive compact segment, Cadillac will finally be able to attract a new, younger kind of customer — a luxury the Wreath had Crest brand hasn’t been able to enjoy over the last couple of decades. This has, for all intents and purposes, been a major impediment for the brand:

“Cadillac has been handicapped because it didn’t have a product that was relevant to young luxury buyers,” said Cadillac marketing chief Don Butler at a recent ATS media drive.

In fact, Cadillac’s ability to attract a younger customer base shouldn’t be taken lightly — since the ATS will allow customers to fall in love with the brand at an entry level and then move up through the Cadillac lineup in the future. So not only will overall Cadillac sales increase directly thanks to sales of the ATS, but they will also improve over time as new-to-Cadillac buyers move past the ATS to the CTS, XTS, and the much-rumored Omega-based flagship with time — thereby increasing sales of those vehicles, as well. That, and the ATS will also make Cadillac cool.

The GM Authority Take

Planning for short-term interest and long-term customer retention is a tried-and-true business model. Our question is why this hasn’t been done earlier.

GM Authority Executive Editor with a passion for business strategy and fast cars.

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Comments

  1. Yes, ATS is a good deal all around…still a bit pricy but I am going to look into it

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  2. I saw a white over tan BMW convertible today……so nice…..hope ATS can compete with one like it.

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  3. Young or old a buyers a drivers car comes to Cadillac. This car had best be good, this car best perform. This best stay together or Caddy may be done in years to come.

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  4. Sorry for the typo’s

    Young or old buyers ….. a drivers car comes to Cadillac. This car had best be good, this car best perform. This car best stay together, or Caddy may be done in years to come.

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  5. It is a great start…hope they add the appropriate standard equipment soon….it is $$$ for the base and people will not like paying over $4k for the things that should be there to begin with, I think. I do like it but not sure yet….I will wait til there is a great sale before I would ever buy one.

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  6. Truth be told, late to the party is the first thing that comes to mind; possibly to late… BMW is the standard and if your going to spend a lot of money on a car for so many they go directly to BMW… Now many of us know that BMW cars have there issues once they come off lease and it’s a car that will cost you $$$ down the road… But most people lease these… But perception is everything and the perception is where has Cadilac been in this segment, BMW is the high school bully who runs the show and Cadilac is the new kid. Time will tell, but I have seen 0 on the road (Chicago area) and 3 chevy sparks allready…

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    1. Well, lets take which car is actually better since everyone agrees the ATS is competitive with the 3. BMW is owning the perception game right now, its widely known for excellant performance and driving dynamics and as always being associated with luxury. Cadilac is known for … , well, not much except for maybe being an old gradpas boat. However, the reality is that Cadillac is unknown to the average luxury buyer, but there is a silver lining. When you been leasing a bmw or a merc for 12 years at 3 year intervals, you start to get bored, and bmws bland styling isnt helping at all, so your willing to go try out the new kid, especially after youve been hearing about how much GM has changed from the bankruptcy and because the ATS looks so different from what a cadillac is in your mind. And because the people have such low expectations for an American car they will be pleasantly surprised.

      My point is that Cadillac and the ATS have a once in a lifetime golden oppurtunity to define what Cadillac is all about, if they can make sure the ATS and next gen CTS are recieved as world class cars, then I bet in 5 years BMW will be holding meetings on how to stop GM from continuing to steal sales.

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      1. Right on, Babersher. I wish I could get my hands on some consumer behavior studies as it relates to leasing/owning the same brand over the lifespan of a customer — as the “wear-out factor” is not only very real, but also is very strong among those who seek excitement from their products.

        As for BMW, I’m a fan of the new 3er, X3, X5, and Z4. But the rest is rather bland, as you said. They are nice, but in a bland way.

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  7. I don’t see why the vertical LED headlight accents aren’t standard… If a car like the Chrysler 200 can have them standard at 19k then I don’t think it would effect profits too harshly.

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    1. Hunter…I agree 100%…Cadillac is a luxury car…..can’t this brand live up to its image by giving the consumer moe than a Buick Verano…the least expensive car???? Hope they are listening to us.

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      1. Eric…how much would it cost to add fogs…Verano has halogens free of charge………just sayin 🙂

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    2. As I said once before, Cadillac loves to charge lots of money for things that really should be standard….just as Honda does; for example…I really think there should be more standard for ATS…it would make it much more attractive to buy Cadillac if it were to have standrad rear-folding seats, fogs, etc….

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  8. Yaba…yes, I have not seen any ATS here…won’t be in town til October I’m told….not good. see lots of Buicks especially the Veranos, Chevys, GMCs……not off to a good start at all………once ATS is out we will see how it oges….just think it is too $$$

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  9. Danny, huh I thought it had launched, my bad… It is pricey… But it is competitive with other cars it competes with…

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  10. I’m sure we’re going to see all the head to head comparo’s once the ATS hits more dealerships. It’s the real world experience that will define this car!

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    1. David….yes, in a month or so when cars are actually available….it will be great to see how people receive it…I’m sure it is very nice. I see CTS is on lease for $299….I bet the ATS will be very attractive when there is a sale…..

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      1. ATS LEASE IS $329 for two-year low-mileage…..kind of high?

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        1. I wouldn’t expect any luxury car lease to come in below $300 a month… especially one that spans a short term.

          What’s the residual? How much down?

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          1. Alex, down payment for lease was $3000 or so….didn’t say anything else except low-mileage…the site will tell you. CTS is $299

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            1. There are incentives on the CTS… but $330 (plus tax, tag/title) for an ATS seems fine to me.

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              1. Alex, not a bad price for lease…that is base model I believe….I’d get sunroof and heated seats at least………still no camera, fogs, etc……Verano keeps coming back to mind

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  11. I will be test driving an ATS as soon as available at the dealer. I’m confident that the ATS will do well in the marketplace. The ATS line will need to be expanded as soon as possible to include a convertible, a coupe (actually a true hardtop with no B pillar would be great0 and a wagon.

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    1. Wayne, let us klnow how you like the car….whenever it shows up! I too want to test it….I am sure it will be very sharp. The only person I know of to drive it is Alex.

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    2. Wayne…………..a coupe, please. With the rear seating so tight, the lack of doors might make it feel/look better?

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      1. The model models under ATS umbrella the better, I’d say

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        1. ooops, meant to say the more models…the better

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    3. If it was a “true hardtop” there wouid still be a B pillar, but there would be no C pillar.

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  12. Dan a coupe version of this car does not exist…

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    1. I hear a coupe is coming along

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    2. No ATS coupe yet of course..the sedan isn’t even on the streets yet….it will happen 🙂

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  13. What no C piller ………… now that would be odd.

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    1. There is no such thing as an implied pillar. If it’s there, name it accordingly. If you have 2 pillars, you have A and B pillars. A C pillar, logically, idicates 3 pillars. Continue on with things like a Chevrolet Express and you could have H pillar; ad infinitum

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  14. Babersher: Do you think BMW will sit around for 5 years? BMW is on it right now…

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    1. RJ — I don’t think it’s a matter of BMW sitting around, but rather one of Cadillac revitalizing its lineup to a point that it is much, much better than what was available a year ago. In other words, Cadillac will be closing the gap on BMW much faster than BMW will be able to progress itself; the rates of improvement of each brand is what’s at stake here.

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  15. Alex: I repled to the comment made by Babersher

    “then I bet in 5 years BMW will be holding meetings on how to stop GM from continuing to steal sales.”

    BMW is not going to wait five years.

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    1. RJ — I realize you were replying to Babersher… but I’d like to be part of the discussion as well, if you don’t mind.

      The point is not that BMW will wait five years, but that Cadillac’s rate of improvement and overall growth will be much faster than those of BMW. That’s how Lexus came out of nowhere in the 90s and became the leading luxury brand by the early 2000s.

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  16. I don’t mind ………… do you think BMW will sit around for 5 years let alone one year?

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    1. Like I said, no one (including BMW) will “sit around for 5 years”. The point is that BMW has little room for improvement. With the ATS and new CTS, the improvement for Cadillac is/will be exponential.

      So as BMW stays a steady course (as it has for the last 10 years), Cadillac catches up and shocks those who may not have considered it over the last decade or two.

      I hope that’s clear.

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      1. If BMW is really smart, it will offer be offering more standard features at a better price than Cadillac……

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        1. Ironically, Lexus offers standard leather on the IS and ES… both of which are Verano and LaCrosse competitors, respectively.

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        2. Danny, BMW can never afford to do that, that is what the Cadillac should be doing to BMW and Lexus has been doing for a long time and what Buick should be doing to Lexus.

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          1. I agree, Barbersher….I was trying to get BMW to force Cadillac to do what it should be doing 🙂 Verano is doing that to Lexus/Acura….I wish good luck to GM….I am seeing the ATS about…..nothing much in base of course…..$45k mostly with all the options (that should be standard)….

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  17. I agree BMW or KIA will not wait five years……..I hope that’s clear. If GM improvements are not exponential GM may not be around in 15 years. Last chance for GM to pay attention to consumers.

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    1. Went to Cadillac dealer today…no ATS brochures and no car yet….October I am told….crazy. I did look at CTS coupe…very nice…but I had a terrible time getting into rear seat…seatblets were in the way and I am not tall….awful rear head room…..crazy again. it was very cozy and extremely pretty too….so, I am waiting to see when they even show up. Why the dealy??????

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    2. What’s clear is that no one ever said that anyone will “sit around” for any amount of time, let alone five years.

      Are you familiar with the Rate of Improvement principle as it relates to consumer perceptions of products?

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      1. Alex, you are always clear in your responses….good 🙂 I am clear in what I’m saying that I agree with you

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  18. Yes and if the rate of Improvement needs to transcend the consumers perception of GM cars when they read and see recalls on what they believe to be every new GM car that comes to market.

    GM has been given a lifeline, will they let it slip away?

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  19. Sorry I didn’t proof read.

    Yes and the rate of Improvement needs to transcend the consumers perception of GM cars when they read and see recalls on what they believe to be every new GM car that comes to market.

    GM has been given a lifeline, will they let it slip away?

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    1. The way I see it, BMW has had no real competitor, Merc and Audi have not seriously posed a challenge to BMWs “Ultimate Driving Machine” mantra. Cadillac is laying the ground work to compete directly with every BMW model.

      “then I bet in 5 years BMW will be holding meetings on how to stop GM from continuing to steal sales.”

      And you seemed to misunderstand what I meant by the above quote. I dont mean Caddy will better than BMW, sell more than BMW, or have a better reputation than BMW. I mean that BMW will start realizing that Caddy is a threat when they see their sales growth stalling and profit margins slightly declining. Right now, their holding meetings on whether the ATS is a threat or not. And even though BMW will downplay their concerns in public, BMW has still shown that its not taking the ATS seriously, and thats a mistake, because even though the ATS isnt hurting now, the next generation will, and saying 5 years was a mistake because i was referring to the next gen ATS and CTS and they will probably come in 6 or 7 years.

      BMW is not standing still, no company is standing still, expect maybe Honda(Who knows what they have been doing the past couple years). But as Alex said, Caddy is growing exponentially at a pace BMW can never even dream to match. BMW vs. Caddy is like Apple vs. Samsung a few years ago. The first Iphone was light years ahead of anything Samsung had to offer, fast forward 7 years, the Samsung Galaxy S3 is a legitimate competitor to the yet to be released Iphone 5. While Samsung was playing catch up, just like Caddy is now, it took them 3 months to release a feature that took Apple a year to develop.

      The point is that if Caddy can grow at the rate their growing and BMW grows at the rate their growing, by the time the the 2019 ATS and 2020 CTS come along, BMW will be very worried about their closest competitor.

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  20. I know …………… but it’s so much fun to get Alex fired up over nothing.

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    1. 🙂

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