The Chinese are coming. Again. Following the announcement of the 2016 Buick Envision heading to North America from China, General Motors and Cadillac have confirmed the 2016 CT6 PHEV will also be imported from China.
For the record, before the comment section fills, the 2016 Cadillac CT6 is already being built in the United States. The 2016 CT6 PHEV, however, is expected to be a much stronger seller in China than North America. Therefore, the strategical decision to import the PHEV model was made.
Uwe Ellinghaus, Cadillac CMO, confirmed the news at the 2016 North American International Auto Show, according to Bloomberg, where he said the CT6 PHEV would be built only at only one factory in China.
Chinese tariffs make importing vehicle into the country extremely expensive, therefore, many automakers have set up shop locally. The news also shows much faith placed in the quality of GM factories in China with the 2016 Envision and 2016 CT6 PHEV
Comments
Agree with the decision.
For the relatively small volume of small volume segment it does not make sense to set up tooling in 2 different countries. As the article says, if Cadillac decided to build here and ship to there the model would face high tariffs and make it uncompetitive to the other players in that segment.
The decision will take some flak but it’s the right decision.
Chinese imports. First one, now two.
And then Verano.
It’s like being swallowed by a python.
Doesn’t really hurt until everything goes dark.
And China keeps 51% of the proceeds.
I know we have offshore assembly in Poland and South Korea and Canada and Mexico. But I don’t think they have the same favorable arrangement that China does.
You are right the corporate ownership structure is different in the countries you mention yet that isn’t the issue. If it was possible to make a business case for using any of those countries and getting the same results GM would have.
The corporate ownership structure is not going to change anytime soon in China. Are you saying GM should stop doing business in China since 51% of profits stay in that country?
I hope the Australian public doesn’t adopt the same mentality of only buying what is produced there.
Not sure why you’re bringing Oz into the conversation, mate.
It’s not even one of the twenty biggest auto buyers or manufacturers in the world.
My point was that GM will stop all production Australia very soon.
So if fine folks in the land of Oz decided to also boycott any vehicles that was not built there then GM would lose those sales.
It is the only way to do this till the market demands more of these or requires more of these in the future.
Just the fact that GM was saved by USA taxpayers an even exists today should weigh enormously on executive decisions and policy. Its more than a numbers, MBA calculation. Apple was never saved by USA taxpayers and managed to stay in business barely with a simple quarter million dollar loan from a direct competitor who only did it to say that Microsoft still had competition in their market and the US government would have to split the company up as a monopoly.
There is a battery factory in Detroit where US workers make Volt and ELR batteries already and the motor systems for Electric GM and Ford and other vehicles. Shipping a 4,000 pound vehicle from China is way more expensive than planning for the next 5 years to loose the obvious electric market in that timeframe unless GM has agreements to buy Tesla before Apple does. Apple has the 100 Billion dollar plus warchest to beat GM silly. GM is not the oligopoly it once was. Rethink before its too late.
I know what I’m saying from experience in negotiating the purchase of a 2014 ELR last July for $39,000 off list price. I’ve studied the electric car market for 10 years. A 60% discount on an outstanding engineered vehicle was a crime of marketing that I was more than happy to take advantage of. Good marketing could have sold way more than the 2,000 ELRs produced over the 2 year period. I could design a fool-proof marketing plan to avoid this disaster again. Again I know this from my 40 plus years in advanced Technology marketing successfully. Simple marketing principles could have avoided poor market introduction if GM had truly wanted to sell higher volume. I am grateful for the affordable Cadillac ELR, but rather than anticipating low sales of a perfectly designed full sized CT6, a plan to produce domestically in USA factories could take a big market drag on the CT6 away. I’m scouting for the next electric CT6 electric bargain, but a mutually satisfactory arrangement to write an effective introduction plan of USA produced CT6 and USA produced new Buicks could be far more effective in a 5 year plan. Or I’ll just wait foe another Electric failed USA introduction by Cadillac. Your company can still avoid this continuing market disaster.
Since the bailout GM has increased its production and workforce in America at the expense of countries like Mexico, and especially Canada. They are the only company building a sub-compact (Sonic) car in the U.S. The investment to save GM was worth every penny. Every area of the automotive business in America benefited by saving GM. The industry, and the country would have still been feeling the effects had they let GM fail. A bailout of a company like apple would not have the same economic impact because most of their production and parts sourcing is done off shore. Believe it or not, it is a fact that GM still builds and sources parts more from the U.S. than any other nation in the world, and I wouldn’t expect that to change.
The UAW was bailed out by the us taxpayer . Gym would have gone into a prepackaged bankruptcy . All union contracts and pension obligations wiped out and new gm would have marched on . The UAW was bailed out . Get that straight
maybe I shouldn’t say anything as im in Toronto, but is it the word china that hits a nerve? importing isn’t new plenty of GM cars were made in southern Ontario, Mexico for so long and imported to America even post bail out. Even the SS is imported from Australia yet there were very little commotion for those vehicles which included (Camaro,equinox,impala,xts,+more) its a business decision that makes sense. and remember profits for gm stay in the US while profits for Japanese cars even if their made in the US don’t.
i may be wrong on some points above but my point is its not the end of the world, and i will always be a GM customer
China charges huge tariffs to bring a foreign car into their country, I think it would only be fair if we did the same. We’re building cars there because of their rules, but we’ll take anything from anywhere. Who’s really winning here? Who’s rules are we playing by?
Cadillac’s experience with the ELR demonstrate that until Americans are willing to embrace buying luxury hybrid vehicles, it makes no sense in building a niche market vehicle like the CT6 Hybrid in the US especially given the investment cost for US production; but like the Buick Envision, if US sales for the CT6 Hybrid demonstrates it’s financially viable to build the car in the US, General Motors will do so.
It is so easy to justify building this vehicle in China for export to North America but thousands of jobs that could go to our own people in building the Envision go begging , now it’s Cadillac’s turn and then ……? This is how we got into such a bad situation with common everyday household items in everybody’s home,,,,made in China !! From I pads to clothing and textiles , with a much lower wage and benefits , plus almost no worker human rights , we just enable this communist monster more and more . Frankly , we have become world consumers , whoever has the lowest price and delivers the most for that price , gets our business . Jobs be damned , as long as the banks give us the credit to buy these 40,000. dollar plus vehicles , who cares ?? This , believe me , is just the tip of the iceberg , for once this most costly purchase people make other than a house starts rolling off the boats from China , the biggest employer in the world , the MANUFACTURING
INDUSTRY , sees potential employment and many thousands of real jobs departing from North Americans big time ,,, it will affect our children and theirs for generations to come !
As a buy American advocate it pains me to read an article like this. But, as the son of a former GM employee I understand the logic that goes into making these decisions. First, for those calling out GM saying that, ” This is the tip of the iceberg for GM, only more important vehicles to come.” I regret to inform you that GM has imported countless models throughout the years: Avalanche, SRX, W-body, Newer Body style Regal (First years of production), HHR, Spark, Aveo, and F-body….etc. But, I will say over the past few years of the “new” GM I am ecstatic to see vast amounts of new model production actually returning to the United States. The issue comes from the “knee jerk” reaction people have when they hear news like this. However, these are the same individuals who complained when GM asked for government assistance. What they don’t understand is decisions like this ultimately help GM stay competitive, thus keeping your “government motors” at bay. There is a logical reason for each decision GM makes when it involves a controversial topic like this. In conclusion, feel free to express your feelings on a topic such as this….however, I only hope you put this much effort into reading the country of origin on every product at your local Walmart, as well.
Dan thank you for the post. It is well articulated and accurate.
If Americans want more jobs they have to again learn how to be competitive or be willing to work for less. Companies for better or worse are in business to make money and pay stock holders for their investment. If they do not make money and pay dividends they lose investors and go bankrupt. It is the nature of business.
GM could chose not to import these two models but yet if they did not bring them over we would never see them as there would little meat on the bone to make them here in low volumes and higher cost.
No one wants higher prices and they all want more in their 401K but they do not want products made outside the US market. At least that is what they say but as they say actions speak louder than words as they continue to buy imported products and car that may be made here but profits that still go back overseas.
There is no perfect solution but the fact we need to follow the money. It is not so much anymore where the jobs go but where the money goes. Follow the money.
If the UAW wants more work they need to be completive globally now as they are no longer just working against Ford and Dodge across Detroit anymore. Some locals have proven they can be competitive here but still many want to play hard ball and they will not be rewarded with work unless they work with the companies.
GM moved the Sonic here so it can be done but some plants still have not figured out they are not the only game in town anymore.
Times have changed and we again need to work for what we want and educate ourselves if we want to do better.
Time to stop blaming companies and everyone else for you not making it in the world as the only thing limiting you is the will and drive to do what it takes to make it.
The solution to making more money is not to just pay someone more for doing the same thing but to improve your place in life and work with education or training. You want better pay get a better job and to do that better prepare yourself for it. That is what many who come to this country with nothing do. I have seen it time and time again they come with nothing and they do what it takes to get ahead and end up Doctors, lawyers or business owners because those that are here are not willing to sacrifice to do what it takes.
There is nearly nothing you can not do or become here but many would rather just sit there and hope their lottery ticket pays off vs. making their own luck.
Lo the horn of plenty is bursting at the seam
The harvest of the world will be our prize
We claim to know the secrets, the answers have been found
But how can one fool make another wise
‘Cause nothing’s better than it used to be
To live and die is still a mystery
We take away and we give nothing back
We just consume it all and still we lack
No one together, No one is touching ground
Look at each other, Chaos is all around
Same situation, Nothing is really new
No one together, No one is me and you
Think about it!
We can expect more pay but who will pay?
This doesn’t make any sense. The factory in Detroit Hamtramck is already tooled and producing validation build CT6’s. This same factory already produces the Volt and ELR. So it makes no sense to import it from China when it would literally take next to nothing to do it in the US.
Exactly! I don’t see why this is necessary when it doesn’t appear to be that difficult to add the CT6 PHEV assembly to the Detroit Hamtramck plant! Is it really that hard to retool it for this? I’m beginning to suspect there’s more to this decision than meets the eye……GM needs to explain! Has it been confirmed how high the demand is for the CT6 PHEV? Because if the demand isn’t that strong then GM should forget wasting the time importing (another) Chinese assembled car over here! I guess I should level this same statement towards the Buick Envision!!! How’s the demand for the Envision anyway?! Are customers aware of the vehicle at all?! And is GM willing to market its Chinese assembly?! Since they are “very confident” in the quality and safety of its Chinese assembly then they should BOLDLY share this confidence with potential customers! And if people are still willing to buy the product, then let GM import all the cars they want!!!!
It makes sense when adding a hybrid to the assembly line is not like adding a vinyl roof.
The simple fact is this. This car is going to be low volume in the American marker. It already is going to be higher priced as it is.
To build it in MI would entail added cost to a already more expensive vehicle making it that much more difficult to sell at the already elevated price.
GM can not ignore making these cars as they will become the norm as we move on as Hybrid technology will not be optional but standard as regulation come that give them no choice. By making these now it will help drive cost down when it has to become standard.
Customers are not wary as the parking lot Is full at Harbor Freight every day when I pass by as the only thing in the store made in America are the employees. You want to know what China Smells like go there.
The simple fact is people speak out with their words but they act with their wallet.
If GM could build everything here they would love to do it. It would make things much easier and simpler but that is not the way it works. While many of you cry about the prices of American made products you still shop at Walmart. Sorry you can not have both. And no if you buy American you are not going to get paid more to buy it either.
The fact is the American public will not pay more and will not do with less spending power.
If you really want to get serious about this you should take issue as to where most of your pharmaceuticals come from. Yes they are coming from China now. Think about that when you get your flu shots or take your blood pressure meds.
The fact is many of you under estimated China and for too long let it go. Today you are in competition with them and they will take your lunch and eat it because you will not pay the price for American production be it higher prices or lower wages.
When trump gets elected and if he has his way you can expect a 45% tariff on this and the envision. Putting an end to these commie cars.
Sure and then they add tariff to the many things Economically they could easily crash our economy if they would like to. The only thing saving us is the exports as well as the fact that they need our economy to help keep their viable. We are joined at the hip like it or not.
we no longer make and or could produce in short order and send prices through the roof here.
Follow that with the call in on the many loans they have given our government.
Did you notice how when their market went down ours followed. That is a simple lesson in economics here.
Trump says a lot of cool things that many people are thinking but he is smart enough to know he can not most of what he says. He is a very shrewd man that has spent little in his campaign by saying outrageous things and let the news media promote him.
Trust me I love America and try to buy American as much as I can afford. But the fact is so much is not made here anymore and so much is not afford able anymore. Even your damn Twinkies are from Mexico as they could no longer afford the work force here as people would not pay the increased cost.
You want to fix things here you will need to learn to do with less and learn to pay more. Then you have to convince the rest of the materialistic American public to do the same.
Most of you are nothing but damn hypocrites as you say what you want but most of you would never sacrifice to do what it would take to fix things.
To fix this you would need to learn to pay more, be able to afford and buy less and stop relying on the government to take care of your every need. With nearly 50% of the American Public now receiving funds from the government in some form few will go with you on this.
The way out is not easy or simple and too few American are willing to do what it takes. You want to but your foot down on 30K Buicks and 3K Cadillacs but yet you still buy your Chinese Cell Phones, tools and plastic storage tubs.
Until you are willing to pay more for your way in life China and most other global MFG is your sidekick like it or not. The damn Unions and Government is not going to help you now.
You can blame China, Wall St, Companies or Rich people all you like but the power was in your hands and you gave it away before you even had a clue.
You have the hand you were deal so at this point you may not win and may only be able to find a way to lose more slowly till you are ready to sacrifice to do what it would take.
We really have gone too long with out a world war are depression as that is where people learned how to make it in life the hard way with hard work and little reward. That Generation is what gave us the good times and we pissed it selfishly away.
I know many of you will hate this post as it hits close to home to most all of us including myself.
That is how Trump takes minds of people who have no clue and gets them excited when he still has no plan laid out on how he really is going to fix things. He has given no real details like most running for office. They capture the weak minds and take their votes.
The real sad thing is there is no real choice for the office this election. Anyone smart enough for the job is smart enough not to run. Or they would never get elected as you would hate what they would have to do in fixing the issues.
Yes I am pissed off about China and ISSI and our own government regardless of party. And it makes me sad to see so many comments from smart people that have no real clue how the world really works. It is so sad they don’t teach economics in school even as far down as grade school. They don’t want you to know how it works as they have taken your lunch and they don’t want you to know they ate it too.
Agree with the catastrophic effect introducing a 45% tariff on imported goods would have on the economy of all of North America.
Listen….if China comes to take over, it will not be with guns but rather they will simply repossess us. China is the our largest debtee at nearly $1.3T (yes that’s trillion with a ‘T’). They are the single largest holder of American debt.
The question here is how much miss information are we going to believe. GM is a global company making global decisions. Are we going to believe all the neo conservative nut bags and their over hyped rhetoric or are we going to make a conscience decision to support a business that is still a US based and owned company. Let’s tAke for example the Thermos brand you think your buying American right nope Taiwanees owned and operated…
Correction.
GM is a American company making global decisions.
Just as Honda is a Japanese company making global decisions.
Hyundai is a S Korean company making global decisions.
Benz is a German company making global decisions.
I believe I stated US based, read…
You did but you left out the others and where their money goes.
Just adding to what you said.