The ATS sedan was Cadillac’s unmistakably bold shot across the bow in the general direction of the BMW 3 Series, Mercedes-Benz C-Class, and Audi A4/S4 — all of which have established themselves as the stalwarts of the compact-luxury segment, which has traditionally been led by BMW. During launch, GM’s goal with the ATS couldn’t be any more explicit: to steal BMW customers, with ads even mentioning the 3 Series by name.
But while the ATS matches up and even surpasses the 3 Series in certain aspects, the vehicle hasn’t commanded 3 Series prices: through the first six months of 2013, the average transaction price of the ATS was $39,459, compared to $44,764 for the 3 Series, according to data from Edmunds.com. On top of that, the ATS had greater incentives of $4,088 per unit, compared to $3,555 for the 3 Series. The gap between what customers pay at the dealership compared to the suggested retail price clearly presents the challenge currently faced by Cadillac as it moves into the sport-luxury segment to compete head-to-head with BMW and its two German rivals.
Part of the reason behind the pricing disparity is the fact that the 3 Series enjoys a broader lineup that, more often than not, commands higher prices. For instance, the 3 Series is offered in sedan, coupe, convertible, and high-performance M3 variants — with the sedan being the least expensive of the group. Meanwhile, the ATS is currently offered only as a sedan, although an ATS Coupe and high-performance ATS-V variants are on their way for the 2014 or 2015 model year.
The difference in price between the ATS and its main rival also exhibits the edge enjoyed by the BMW brand over that of Cadillac, even though the ATS has drawn a significant amount of critical acclaim, going so far as to win the coveted 2013 North American Car of the Year award. More encouraging is the fact that real-world ATS pricing is more competitive with other top-selling luxury compacts: through June, the Alpha-based ATS sedan commanded roughly $1,000 less than the Mercedes-Benz C-Class sedan, while topping the Audi A4’s average transaction price by roughly $2,000.
For now, the ATS is serving its purpose, and doing so very well by attracting a new, younger customer to the brand. According to Cadillac spokesperson David Caldwell, 74 percent of ATS buyers are new to Cadillac and 20 percent are under 35. Through July, Cadillac sold 22,088 units — right in line with estimates set out by analysts.
The GM Authority Take
The overall image of the Cadillac brand should significantly change for the better over the next few years, as the brand overhauls its product portfolio with class-leading vehicles. It all started with the 2013 ATS and XTS, and will continue with the ATS Coupe and ATS-V, the all-new 2014 CTS to rival the BMW 5er, the 2015/2016 Omega-based LTS to take on the BMW 7er, as well as an overhaul in the brand’s CUV lineup, not to mention the next-generation K2XX-based 2015 Escalade. The better, class-leading product should elevate the brand’s overall perception, and consumers will be much more willing to pay top-dollar for Cadillacs; a rise in average transaction prices should follow. For now, those in the market for an ATS should simply expect to pay less.
Comments
The ATS is priced where it needs to be….where it needs to present itself as a solid alternative to the 3 and not as “discount luxury”; that’s the Chrysler 200’s job.
As before, one day at a time. The ATS doesn’t need to overthrow the 3, it simply needs a stable piece of the segment year after year. The average trans price will climb slowly provided GM carefully manages and cultivates the public image, perceived quality, and superior engineering of the ATS.
How can the media compare how well a car is doing after its been on the market for not even a calendar year! They are making a case about a car that is not even fully released yet, there is no two door version, convertible, performance models! There is no year over year data, no reliability issues to look back on!
Show me what these numbers look like in say 3/4 years, then we will all know what GM really has and what the public thinks of GMs new ATS and how it stacks up to the 3 series!
This just goes to show you that you don’t need to be in a certain segment for decades in order to convince people to purchase your new car as long as if its top notch!
It would help if more cars were equipped with the “driver assist package”, a $3600 package with a bunch of useful features that belong in a car of this caliber. I leased a 2013 ats 3.6 performance, but I was unable to find more than two cars in the entire Chicago area with this package.
Hope they offer the V-sport
The 3 Series has had decades to establish it’s image. Finally a manufacturer has come very close
to it’s performance and value levels. Rome was not built in a day – my friends.
( Here I am sounding like The Most Interesting Man In The World! ) L 🙂 L
The ATS is an entry point to establish a full-blown assault on the Germans. Conquest sales are
the name of the game. ATS will have diesel, AWD, coupe and convertible variants. Caddy will
shoot themselves in the foot if they pull a D2XX Cruze stunt and stretch it’s model iteration longer
than they should. BMW 3 is a moving target, they do a good job of coming out with a newer,
better one just as rivals begin to catch up.
Cadillac has a good start on this one. Let’s watch as sales chip away at the longtime leader.
This is a first attempt and GM was not going to beat all of them on the first swing. It takes time to grow a Model and brand and GM will do so in each and every year and model.
The ATS has done what it was supposed to do and will continue to grow. The CTS will build on this as will the LTS.
It took ten years for the 3 to be the market darling so no one should expect the ATS to take the lead yet. To be honest to sell better than the Benz and A4 says a lot and with the BMW you are fighting a major bias that takes time to break down.
Why is this even an issue? Of course if, (as the article indicates), the pricing average of the BMW 3 series includes the price of Ms and convertibles the average is higher-If there is a way of comparing only sedan pricing you would have the basis of a true comparison-otherwise it’s a flawed endeavor.
Remember, the 3 is being split along bodystyles, with the coupes becoming the new 4. That means that the ATS sedan and ATS coupe will have the 3 and 4 (respectively) as comparable segment products.
I’m new to GM having picked up my 2.0L performance model in May. I previously had a 3 series and was considering that again along with the A4 and Benz c class. To be honest, I went with Caddy because I got the best deal vs the similarly equipped rivals. Plus I found it to be the most handsome car in the segment, as the new bimmer body style left more to be desired. I couldn’t be happier with my choice- the cars a dream. People were surprised I went with Caddy but after seeing it my friends and family have definitely come around to thinking of Cadillac as much more than the senior couch on wheels of long ago. As the product portfolio lineup expands and more of the current models convert on the street it’s been my experience that Cadillac is in for a major uplift in perception. But changing perception takes time, luckily Americans have short memories, I mean president bush’s approval ratings were recently up as an example of how fickle perception can be when properly managed.
Cadillac is the best.
I absolutely love my ATS…I do wish it had more standard features….fogs, folding seats, cd, etc……but I can add a few things larer on; car is a dream to drive and looks so good 🙂