Cadillac Eyeing Plans To Push Escalade Into $100,000-Plus Market
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With a wave of new luxury SUVs about to flood the market, Cadillac may have found an answer to what it should do with the oddball-success story of the Escalade nameplate.
While brand managers and marketers ponder where to take the Cadillac Escalade next within the brand’s portfolio of vehicles, the market may have just made the decision for them. Cadillac is seriously considering taking the Escalade into the high roller territory, pushing the content and power to create a $100,000-plus SUV.
“The argument for doing it with Escalade is strong and momentum is moving it higher. It’s completely logical that’s where you go with it,” said Cadillac spokesman Dave Caldwell to Automotive News.
The news comes hot on the heels of a rumored Cadillac Escalade-V with LT4 6.2-liter supercharged V8 power, which would also likely push the SUV’s topped out price tag of $95,870 for a Platinum ESV trim past $100,000.
Caldwell stated that plans have not been solidified, however, stating the focus is on filling gaps within Cadillac’s lineup, specifically with new crossovers.
“The strength of the Escalade prompts us to think about ways to delve into even further,” he said. “But filling new portfolio slots for us is far and away the priority and new variants are much less of a focus now than in the past.”
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Let’s see the return of a pickup. Everyone is pushing out high trim level trucks, Cadillac should make the top dog.
GMC, They need that kind of differentiation. Loaded luxury pickups, and heck, luxury commercial vans for the successful tradesman.
Pushing the price of the Cadillac Escalade is a great idea…
then they can collect dust on dealer lots just like the CTS and ATS.
Because there wouldn’t be anything to differentiate a $75K Escalade from a $100K Escalade?
I think you’re incorrectly thinking of a $100K Escalade as a being simple trim option of vinyl and badging.
Be creative with your imagination of what a $100K Escalade would have over a $75K Escalade. Think more bespoke options and interior appointments.
I mean a Range Rover Autobiography starts at $139K, and Autobiographys were never intended to be a volume seller despite their mass appeal.
Why can’t Cadillac make offer such product with the Escalade? Why handicap Cadillac by not moving up market, to chase those wealthier customers? That was Cadillacs’ original mandate!
ATS and CTS maybe collecting dust but not so the Escalade. It is a brand in and of itself that will garner a 6 figure price tag.
Start with the Platinum model. Drop in a slightly detuned LT4 (in the 625hp /625lb.ft range ) smaz up the interior a little ,sport up the exterior, move the column shifter to the center console and for God’s sake put in a larger full length sunroof.
Call it the Cadillac Escalade V-Sport Platinum.
( SWB only ) price it between $125-$130000 and call it a day.
I assume the Escalade is going to be the XT8…is going the benefit from being a large SUV than just being a large SUV…..the CT8 and XT8 could have the same body lines and brovo…as being the top dog Caddys.
Cadillac has said that the Escalade name is staying
the BIG COMFY CARS should come back as the CT8 and XT8/Escelade flagships….FLAGSHIP means BIG. BETTER and COMFY WITH A V8 and have straight lines….NOT JUST SQUISHED, FAST AND HAVE STIFF AND HARD SEATS and look like big ATS….BIG AND COMFY with a V8 is a true flagship and an icon…witch has been missing from Cadillac for years….the CT6 is nice… but not quite the retarn of the BIG COMFY V8 ICON….THE CT8 would take that misson.
Wonder if Cadillac understands that it’s exorbitantly overpriced vehicles might have a bit to do with their sales problem.
Have you looked at the prices of comparable luxury vehicles from other brands? If you think Cadillac is overpriced, then you have no business looking at the Germans, Lexus, or Land Rover and then complain about price.
Guess what Lincoln is for? To catch the price complainers as they fall from the sky by offering them a substandard product with a hollow promise of ‘value for money’ instead of a truly exclusive product.
cadillac ATS/CTS/XTS/CT6 are overpriced and the styling and body shape is a bit stale….its both that has to do with sales problems….it could be more things.
I can see it as these are extremely popular vehicles already. Make one that is over the top and people will buy it regardless of the cost.
Hell GMC just adds a little chrome and wood on the wheel and get thousands more for a Denali.
Mercedes already does this now and while it is low volume it makes big bucks.
That is the key here for people who do not understand the big picture. You don’t have to sell many to make a lot of profit. It also will drive the sales of the less expensive ones even more.
GM should call this the Money Tree as they just keep picking and picking more money from this vehicle. More power to em.
Well, I’ve asked before what the profit margins are, to no avail.
So, Escalade has sold 13,000+ through August.
And, just for argument’s sake, since no one seems to know (or be willing to share) how much dosh is falling from “the Money Tree”… this is partly factual, partly hypothetical:
Cadillac has sold 13,000 Escalades so far in 2015, and – let’s pick a generous number … say, $40,000 pure profit per car. That’d be $520,000 pure profit in eight months. Mark them up to $100,000, and that’s maybe $850k to $1m profit per year?
Am I wrong? It doesn’t seem like a game-chaging amount – I wonder if it even covers the losses the ELR generated.
Especially after they cut the price to $65k. Or what the helicopter reveal/fashion show in Manhattan’s price tag was …
Yes, you have to start somewhere – The Escalade probably needs some upgrades to make it into the six-figure club. But people still buy them.
The CTS-V starts at $85. And the XT5 should do well.
But there’s a long wait after that.
So we’ll see.
There’s a lot of attention being payed to millennials, but on Cadillac’s current time-arc, they may as well start catering to Generation Z.
Wonder what marketers will call the generation after Gen Z?
Let’s assume your in a ballpark with your assumptions…I think they make bit more than 40K on each Escalade….I think it’s closer to 50K per vehicle, but let’s go with your figures.
Problem is, you’re missing 3 more 0’s in your profit calculator. It’s $520 Million, not thousand… thru 8 months of this year nonetheless. With the mark up we’re talking about $850 Million to $1+ Billion so far of pure profit off of one low volume nameplate!
They will sell about 20,000+ Escalades this year. At $40,000 per vehicle that’s $800 Million before markup. At $50,000 per vehicle that’s $1 Billion before markup.
Actually, Cadillac sold 22,321 Escalades thru August according to sales with the ESV combined.
GM is not going to release numbers like this as no automaker would.
But for your review here is the simple steps to profit of a vehicle like this.
Take a platform that you already sell for tens of thousands of less dollars that you sell in great volume under two different brands already and make a very comfortable profit.
Then you had several thousand more dollars of equipment and trim to it and then sell it for up to $15,000 more you make a killing on it. Then you add another $5,000 in trim features and sell it for $20,000 more even more money is made.
It really does not take a Einstein to understand how this works. This too is how the cars have worked too and how they have been making money. If you can make money with a V8 from a truck or a Malibu the profits carry over to the Cadillac at twice the cost.
The secret is it really cost little more to make a Cadillac over a Chevy other than material cost. They cost no different to design or build. They do cost more for content but is that really $20,000 more in content?
This is the general rule and profits of a Luxury brand and why nearly every company wants a part in it and can afford to sell low numbers for many years.
This is how companies like Infinity and Hyundai can afford to sell cars at such low numbers that they are nearly invisible and yet keep them on the market. There is a lot of meat on the bone of each luxury car.
The difference between a Yukon SLT and Denali is a little bit different than a little chrome and wood on the wheel! The biggest difference is the 6.2 V-8, 8-speed automatic, and Magnetic Ride Suspension all standard with the first two not available on the SLT. It just so happens these are the same three component aspects on the more expensive Escalades!
The other option should be a diesel engine (motor ) if it want to compete with like’s of Mercedes and Porsche and other Luxury SUV ‘s .
You don’t need a diesel unless you want big sales numbers in Europe. Gasoline is still king on this side of the pond.
I’m not sure if Cadillac is ready for this price point. I like their cars. I’m on the Left Coast — in our county, more Mercedes are sold each year than Chryslers — and American cars in our neighborhood are <10%. Lots of BMW, Benz, Audi. Tons of Toyotas, Hondas, Kias. A smattering of Fords.
I'm a Detroit boy. I've seen a few ATS and CTS around. They look nice. I'm not sure what the proposition is for buying one out here, unless you *really* want to be different (and, luxury car buyers are sheeple). Sub-par dealer experience. Resale value is crap. You have to justify yourselves to the neighbors ("you bought American?!?"). And it's not like you're getting a discount at the front end.
If Caddy stays in this game long enough, they should do OK. I doubt they have the stomach for it, though. And . . . . I'm amazed that they missed the boat on CUVs. The Q5 is on generation two. The GLC is coming out, replacing the GLK. Lexus even, just came out with the NX. And Caddy . . . . well, the new SRX (XT-something) is bigger, not in the same class.
With the current price of an Escalade its not hard to see a specialty version selling for 6 figures . Its just the first attempt by Cadillac to start playing in the Teir 1 arena . This plan will work and make GM some serious cash . The Escalade already has a “cult” following and the image to back it up . The people that will buy these aren’t concerned with the resale of it , it’s the prestige of pulling into the country club with the biggest baddest SUV that Cadillac can build . Plus I am glad GM decided not to change the name or share it with another vehicle. Would you buy a wanna be vehicle that had the Corvette name . No .
It will also give Cadillac room for the rumored 3 row SUV that will fall in line between the XT5 and the Escalade . And possibly a stretched version of the XT5 as well .
If Cadillac is going for the $ 100,000 range , they need to make sure that every little detail is spot on , I wouldn’t be suprised that in the build process they go to another sub assembly line for the upgrades . It’s been done by GM before for specialty models .
No matter what GM does with this generation Escalade it’s still saddled with one major problem: and that’s it’s old fashioned, live rear axle chassis!!! Thankfully, sales of the Escalade are relatively good, so I suppose the average customer doesn’t know or care for the fact. But if GM is serious about taking the Escalade into higher territories of luxury and performance, then they must make it a priority to ditch this ancient suspension setup! Even the old Navigator is said to be superior to the Escalade in the ride and handling department; despite the Escalade being equipped with magnetic ride control! And just wait til Ford unveils its all-new aluminum-based full-sized Expedition and Navigator, they might not outsell the GM trio, but they’ll most certainly steal some customers!!!
With that being said, there’s quite a bit that can be done to make the $100K Escalade appealing. Since this is in essence the traditional, RWD, V8 Cadillac, and again, it sits on that old rear axle, the best I can see them going with it is what we see with these custom Escalades from the third party shops. Like what Lexani did with one. You know? Turn the Escalade into an office suite on wheels. With full massage seating all around, smart screen TV’s lining the rear seats, ultra view sunroof, drink coolers, touchscreens that double as a small writing table, etc. I’m sure such a vehicle would appeal to many! I’d love one for myself!!!
Target that range rover autobiography…………. AND DESTROY IT just as the V series did the M
Cadillac can even consider integrating ad advanced cylinder deactivation technology from Delphi where the LT4 can drop to a V-2 engine as this might allow Cadillac to save money from needing to build a hybrid variant as the Escalade could drop to a V-2 when in stop and go traffic.