$12 Billion Earmarked For Cadillac’s Global Expansion
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General Motors plans to invest $12 billion in Cadillac over the next five years to develop eight new models by the end of the decade. The plans are part of the automaker’s strategy to revamp the Cadillac brand and position it as a global luxury leader − especially for the U.S. and Chinese market.
China is ripe for luxury car growth, though overall growth in the market has slowed a bit. Still, Cadillac sales in China for calendar year 2014 amounted to 73,500 units, an increase of 47 percent compared to 2013. Compare that to the 281,588 sold Mercedes-Benz vehicles, or 20,000 units more than the automaker sold in Germany.
Overall, GM sold over 350,000 vehicles in China this past December, a 32 percent improvement compared to December 2013.
According to Cadillac President Johan de Nysschen, eight new products have already been approved, with five being all-new. One of these will be crossovers/SUVs smaller than the current (and soon-to-be-updated) SRX, and one will be bigger. In addition, Cadillac is expected to unveil the all-new 2016 CT6 full-size luxury sedan later in 2015, and a more prestigious model may follow.
This aggressive product plan reflects Cadillac’s desire to have China, along with the U.S., as its volume markets as part of its growth initiative. And building Cadillacs in China helps GM avoid the tariffs imposed on imported vehicles by the Chinese government.
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Impressive as this is a goodly amount to make some major changes.
It usually costs a Billion $ per product to come to market . And that includes research and development . So we are looking at aprox. 10 to 12 models . Some of that will be for the American market , but most is going to the Chinese market . GM wants to get a big foot hold in that emerging market . That is where the growth potential is . And out of that budget you are not going too see $ 200,000 cars . The key is ” volumn ” . GM is a mass producer with goals of being #1 in China and that is going to take money and investments in plants being built in China . That is the focus right now .
The Germans can wait for S-class competition from GM , we have already been told as much since Oct. when Cadillac did a 180 and said the CT6 would not be the car after all .