Why A Sub-ATS Model Is Vital To Cadillac’s Growth Into The Future: Analysis

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• More vital are the Medium Suv´s and Cuv's.

  And yes, a one new sub ATS Car is the entry of a new level of premium cars, like the Audi A1 BMW 1 Series and CLA Merc.

  • Yes, the crossovers are vital. But this is easier to do, so it could come to market faster.

    To note, a sub-ATS car would rival subcompacts like the A3, 1 Series and CLA-Class. The A1 is a city car.

• Well the CUV and medium SUV's are already on the way.

  There is a need for a smaller car also because of future CAFE and also many people due to the stagnate economy are down sizing. With car prices moving up faster than income levels not everyone can replace their car with the new model of one they now have.

  As pointed out a loaded Ford and Chevy mid size is at $40K now and not all that far off the luxury cars. While GM is not totally helpless here as they do have Buick too in helping fill in they too need new models to replace the present ones. We will see a new Lacrosse soon and the Regal should not be too far behind.

  So while there is a need it is not like they are totally out of the segment at GM.

• The problem is customers don't buy GM. They buy Buicks and Cadillacs. Hence, Cadillac is out of the subcompact segment... putting Cadillac at a disadvantage.

  Regarding GM: the thought should be to treat each brand individually, as if it were a division, rather than a brand that's part of "GM" as a whole. There will be some overlap, but all in good health. That's exactly what VAG does with its brands (divisions), and that's why it's the world's largest and most profitable automaker, with all kinds of growth potential still.

  • Yes people buy models but the money all goes back to one place. They may think Buick and Cadillac but the money all goes to GM.

    So while Cadillac as a division may not be competing in this segment GM is still seeing money come in.

    While Benz for the most part has to make due with one major global car division GM has many smaller ones that make up the corporations.

    While this model if managed poorly like GM has in the past has seen this as a disadvantage if managed properly it can be a real advantage.

    Like hand grenades if poorly managed it could cost you a leg or even your life. If managed properly they can be a great advantage in your defense or even ofense.

    The real issue is while others like Audi are decontenting cars to make them cheaper into segments they do not cover they also are creeping into VW territory. This is the same thing GM needs to watch.

    This is a tricky road to take as you want to gain all the sales you can while not competing with yourself. We know that damaged GM in the past.

    The one advantage GM and Cadillac have is they are better versed in smaller cars and if they go FWD like some of the others they are one of the best at this already. Being competitive is not going to be difficult if they chose to go here.

  • Agreed! GM should only represent back of the house tasks such as logistics, R&D, and Wall Street.
    Chevrolet, Buick, Opel and Cadillac need to become divisions once again like at VAG.
    Overlap between brands is good, not a reason for concern. For example, VW CC sales strengthen the brand while not significantly harming Audi.
    I feel as if it had taken Cadillac too long to gain traction in its domestic market. Much of this pertains to overly conservative design that can't help Cadillac overcome it's damaged brand status. A sub compact Cadillac will only be successful once the design of flagship - like models strike a cord in the American automotive imagination.
    This is why a successful upmarket Buick is vital to the future of GM profits. Without doubt, Buick has every bit as much potential as Lexus (high transaction prices) while not being in the RWD vanguard. Buick and Lexus prove that luxury can be soft and approachable.
    My worry is that GM planers will avoid projects like Aveair due to segment overlap. Aveair without doubt would have a trickle down effect on cars like Verano therefore using prestige and price.
    Lastly, models like Audi 3 & CLA aren't really luxury. These cars demonstrate what label whores some shoppers can be. Realistically, a Chevrolet Impala or Buick Regal can run circles around these wannabe roadsters.

  • Actually, the most profitable car company is Toyota with one global brand (Toyota) and three more regionals (Lexus, Scion, Daihatsu) while taking advantage of partnerships with three others manufacturers, each with its own characteristics (BMW, Mazda, Subaru). Take in account the weak yen policy, new platform sharing and a still to come success in China to anticipate the future.

    VW manage to sell as many cars, but through eight brands (Volkswagen, Lamborghini, Bugatti, Bentley, Porsche, Audi, Seat and Skoda) and with less profit. Take in account that VW is still in the process of integrating all those acquisitions, both from an administrative and engineering point, and has already topped in China to anticipate the future.

    So where does it leave GM ? Doing well in China and having hopefully already learned a lesson in platform sharing (vs badge engineering). See the differentiation between Cruze and Astra/Verano ? The point being that they could relatively easily produce an entry-level Cadillac distinct enough to compete with the not so hard to beat CLA and (re)make a name for themselves among a new generation of buyers. Think of it as a marketing strategy.

  • I feel like you're on to something.

    When I visited the Audi dealership parents were impressed by the Q5 and A3.
    Later we visited a VW dealer and surprised later when I told them the A3 & Q5 is actually built on a modified platform borrowed from a VW Jetta & shortened Touareg.

    Later went to Lexus dealer to test the NX200t & CT200h.
    Like above, we later arrived at Toyota to look at a Rav4 and Prius. Cue the surprise when they learn the NX is built on the same platform as the Rav4 & the CT shares running gear with the Prius,

    Needless to say, almost ALL Cadillac dealers here in Toronto are sharing the SAME SHOWROOM as the cheaper Chevrolet corporate cousin. Totally transparent that the engine in that $30k Impala shares the same engine as that $60k CTS sitting beside it.

    The moral is unless the buyer is really into cars, most luxury brands don't really shout 'we're using a lot of parts from cheaper brands!' and the fact they do not share the same dealer/showroom means even if the A3 shares identical engine as the GTI or the ES350 sharing the same bits as a Camry it is not immediately noticeable as Cadillac & the rest of GM's lineup.

• With a good sub-ATS platform Cadillac could also do a CUV and coupe.
  That would give them good coverage in that segment.

  I agree with the article and the longer Cadillac waits to get into this segment the longer it will take and more expensive it will be to get those customers back that bought elsewhere.

  It is unlikely a customer looking to get an entry level luxury brand vehicle will look at Buick as an alternative. It simply doesn't have the cache.
  Buyers in this segment are not generally buying a A3, CLA or 2 series for practicality or need it is to own a luxury brand.

  • Exactly! The longer they wait, the more expensive it will be.

    PS: the sub-ATS car will be on the Alpha, which is good news.

    • I had not heard that. I didn't think the Alpha could go that small. But good on them for giving it an exceptionally good chassis to work with.

      Actually I would like them to make the sub-ATS model just a little smaller and lighter than the current ATS and make the next generation ATS bigger.
      The ATS is currently regarded as a little snug especially in the back seat and one of the smallest trunks in the segment.

      The sub-ATS model, let's call it CT1, would also be a valuable product to spearhead a return to Europe for the 2020 model year and for expansion into new markets for Cadillac.
      India, South America and Russia will all be growth areas in he coming decade or two.

• If they do a sub Alpha it could open the door to the still born smaller RWD Chevy and even a next gen Camaro as it will continue to shrink too. It also could under pin smaller CUV and SUV models too.

  At this point I had not heard anything about the Alpha going smaller yet. If they do it could present some packaging issues as the hard points now has place limits to what Chevy could do with the Camaro to a point.

  • Yes, I thought there was a packaging issue to go smaller.

    Maybe they could use an upgraded version of the Code130R chassis.

    • There is no Code 130R chassis. That is the greatest reason there is no 130R now. The claim then was there was no way to shrink the Alpha and they would have to invest in a new platform. The cost to do so for a low volume car like the R would have been stopped the business case from what I has read.

      Now if Cadillac leverages this out over several models as well as Buick it could change this later.

      The RWD small coupe at Chevy is not totally dead just at this time there are no plans is what was stated. I can see this as other models could come along and make it a profitable venture.

      The real issue is the small coupe sales at Toyota/Subaru/Hyundai have been stagnate at best.

      The 130 was a show car and not a well finished show car at best and was a one off. There is nothing to base on with that one.

• who care chassis or this code or this upgrade. they must just built ideal car and thats it. thats all what we or i need. ideal car. same good as bmw-audi-mb or better

• Gm is fighting battles on multiple fronts. Lawsuits from the recall, developing more vehicles for cadillac, streamlining it's European operations, continuing to streamline global manufacturing operations, etc. So, yes, the public is not fully aware of the current models cadillac has, and also, they still have that assumption stuck in their mind that Mercedes, BMW etc are better. So it will take time to improve sales but some good people are at the helm (Mary Barra for overall operations and Mark Reuss for product development)

• I like the Mercedez M Class. Would I prefer a Cadillac?? For sure. Does Cadillac have anything that is like that NOOO The Escalade is huge and the crossovers are nothing but glorified Chevy's

• I know I'm in the minority, but I would love to see Cadillac build a small hatchback similar to the Mercedes "A" class.

  • Not a bad idea for the Euro market as they are popular there. If they did they could leave a few here to satisfy the niche buyers.

    But they would have to establish the Euro market first.

  • Minority for sure.
    Certainly not for North America. Europe and Asia a premium hatch may have some value.

• The luxury badge plays a key role in the purchase decision ! That one sentence explains it all . Cadillac just does not exude luxury in the minds of the public anymore , escpecially the millenials . They see Audi and BMW mostly as the car to buy , even VW is on their radar . Luxury to them doesnt mean the same as it did to the early Baby Boomers . Shiny chrome and wood accents are not what this market segment is looking for . A small resonably priced car with all the latest techno gadgets in a car that is solidly built . The problem GM has is their small cars were always looked at as cheap and not built well. And GM has a tough time making money on small cars . They always have . Plus the culture at Cadillac is still " if we slap our {new} badge on it we can call it luxury and they will buy it . WRONG . I just read an article that ask owners of their current car if they would buy another one if they had it to do over . There was not " 1 " owner of a Cadillac that answered it yes . That is so sad for the division , and peole read stuff like this so why would they even consider diving to a Cadillac dealership , it aint gonna happen . So , as we soldier on to the '16 model year where is that sub-ATS , where is the XT5 , no change for the A-CTS , other than color changes , selling the XTS that doesnt even look like the current fleet and, an $80,000 dollar truck that if you bought a GMC Denali your driving the same thing . But wait , people will say wait till 2020 , for what , cars that wont compete because they are coming into the game late . The majority of automakers are coming out with some decent products this year , andstill we wait . JMHO .

  • You really need to add some reality to your thinking. Hell if GM could have all these cars tomarrow they would have them but the reality is it takes time to develop and build cars properly. Sorry but 5 years is a pretty good turn around and that is going to make it 2020 no matter what you like to think or claim.

    The fact is these cars will be targeted also for the market 5 years from now too.

    The 2020 Vision here is that the GM and Cadillac know the next 5 years are going to be painful and slow growth with the product they already had started before the first all in approach they started last August.

    So many said Oh GM was too late in the game on the HHR and to be honest it became one of the most profitable and best selling Chevys of that era. It proved if you build the car right and people like it and price it well they will come.

    So it is time to stop the too late BS and let them focus on getting the details right. They also have to repair the dealers and the marketing that is already starting now.

    The growing or improving of an image is a slow process and It does not happen over night. It took BMW years to do it, it took Audi many years to do it and even recently we have seen how long it took for Hyundai to change its image from being one of the worst cars on the market to one of the more popular models.

    The fact is GM is one of the few companies that can pull something like this off and can afford the 5 years of change and growth.

    It also needs accepted that they may not be number one for some years after 2020 too but all they need to do is compete.

    Cadillac has the luxury that they can sell in low volumes make high profits and survive just fine as Chevy and Buick also take up much of the other lower sales that the others fight for with gutted Audi A3 and BMW entry 3 series.

    GM has a good set of cars and finally management that is willing to let them play them for once with a pot that is enough to win big but it take time to set the game up.

    • Well said.

    • GM PDT 1.
      Scott3. 0.

      Thanks for stopping by Comerica Park today, folks.

      • Sorry we have not even hit the 7th inning stretch. LOL!