We’ll preface the story with this: we live in a global, interconnected economy. The saying used to be, “When the United States sneezes, the whole world catches a cold.” While that’s still quite true, China plays a larger part in today’s modern economy than ever before.
Recently, controversy has risen over Buick decision to import the 2016 Envision from China, which was followed by more distaste after Cadillac announced it will import the 2016 CT6 PHEV from China, too.
Speaking to AutoblogGreen, David Leone, Cadillac’s executive chief engineer, explained why the decision only makes sense from a global business standpoint.
“[China is] far more receptive to approving localized production of vehicle programs that have new energy vehicle powertrain applications.” In laymen’s terms, it’s easier for General Motors to build each variant of CT6 because of the green credentials that come with the production.
“To bring any new car into China, to produce it, you need government approval,” Leone said. “The government isn’t interested in bringing many new cars to market that don’t have new energy credits. [The CT6] also provides new energy credits that enables it to be an attractive, well-received product in China.”
China does everything in its power to court new business, and keep business there, through government incentives for “new energy vehicles.” Therefore, the 2016 Cadillac CT6 PHEV is simply poised to do much better than it will in the United States. Cadillac forecasts low demand of the CT6 PHEV stateside, and it made the judgement call to simply ship the few models from the People’s Republic.
It also makes more sense for the supply chain, too. The LG Chem battery cells found in the 2016 CT6 PHEV are made in Michigan, but in much higher quantities in South Korea, making it easier on the automaker.
The 2016 Cadillac CT6 is on sale now in China, while the U.S. CT6 will be built at GM’s Detroit-Hamtramck assembly, and will arrive presumably in late March.
Comments
Folks we can bemoan the decision to import from a patriotic standpoint but there is no denying the valid business case for doing so.
So what they think there will be a low number for the hybrid CT6. Of course there will be when its made in China. They make the batteries in Michigan, so why can’t they ship them “down the road” vs shipping them across the world to put them in a Car that will just come back…? Esp if its a low number and they think they will sell very few of them….
There’s more to building a hybrid CTS
than just shipping the batteries down the road,
Even with the batteries taking a round trip it still makes economic sense. There is more to building a CT6 PHEV than swapping out some batteries. You are oversimplifying the process.
Also factor in the hybrid credits.
union members would not have to worry about this if they had not voted for Obama as a repub president would not have pushed for a 54 MPG fuel average. GM needs to do this so they can get credits to build and sell big SUVs and pickups where the profit is.
Whichever party takes office in the upcoming election is going to have to do something about the 54mpg CAFE because no company is going to hit that mark.
With fuel prices expected to remain low for the foreseeable future there is little incentive for the average consumer to pony up the extra money to buy hybrids and electric vehicles. With low fuel prices the payoff will take even longer to reach.
When the 2017 Chevy Bolt EV sales begin in December, GM will have a better chance to reach the 54 MPG average CAFE number because there will be many more Bolt EV buyers than Cadillac CT6 Hybrid buyers.
Mitt Romney would have sold the company to China!
You got that right. Romney even said “Let General Motors go down”. That would have had a domino effect on all the other industries/companies that depend on General Motors (suppliers, etc.).
Consider doing your readers a favor, Sean and spare the semantics. You needn’t preface your now staggeringly frequent Made in China pieces with “we live in a global, interconnected economy, blah, blah” apologies. You’re covering it with gobs of lube to make it go down easy but really, all Americans should be feeling the full force of the raw violation that it is.
Sometimes, business decisions that “make sense” today bode horribly for the future. Sort of how we ended up where we are now, with almost everything Americans consume wearing that obnoxious “Made in China” label while countless factories are abandoned and the American middle class has died a lingering, painful death, suffering lost jobs one by one until the unemployed and displaced number in the hundreds of thousands. There’s a word for this type of “progress”: insidious. And there’s a word for business decisions that make sense now but do more harm than good in the long run: shortsighted.
This is only the beginning of a trend that will result in more Americans bleeding. Trade only works if it’s fair and reciprocal. Our trade relationship with China is neither. Not by a long shot. It’s a handsome car, though. Go Trump.
Are you also on the FCAuthority forum to berate Sergio for the decision to outsource production of the 200 and Dart which will likely end up offshore?
Since those two models accounted for 265000 units in 2015 that will have a far more significant impact on the UAW and NA production than the couple of thousand CT6 PHEV that will be coming over from China.
Get your head out of the sand. Painful decisions are going to be made in a changing economy.
BTW…’shortsighted’, would be spending the extra unwarranted costs to produce locally only to lose money thereby affecting the whole brand.
My head isn’t in the sand; on the contrary, I’m way more prescient than you’re willing to comprehend. It isn’t about one car. It’s about a movement that’s already begun.
Painful decisions involve rightfully imposing tariffs on artificially cheap Chinese imports flooding into America and Europe – taking us to the cleaners and making a mockery of our “fight” against global warming among other things. Import tariffs will be the only way to stop this runaway freight train. Painful indeed but more to some than to others based on ideology.
Speaking of sand, I don’t intend to put aside more business to fall into an endless pit of FCA quicksand. Peace out.
“I’m way more prescient than you’re willing to comprehend.”
-____-
I assume you meant that you are more ‘prescient than (I am able) to comprehend’ and that maybe be the possible.
Tarrifs would also be shortsighted as that will hurt us more than help since a large percentage of our goods are exported.
Building a wall made out of tarrifs around our economy is not the answer.
Okay, let me break it down for you. Our government and many but not all “corporations” – often in order to remain solvent mind you – sold out long ago and we the people went along with it because we like to save money just as much as the corporate bean counters we love to demonize when we’re standing in the unemployment line. We came up with an anodyne name to describe it in a way that makes it sound acceptable and even worthy of our enthusiasm: globalism.
I’m no economist but I can tell you that what we’ve been doing for the last 20-odd years ain’t working. And expanding it won’t help.
Every US factory in China is 51% Chinese owned by decree of the Chinese government. Figure that one out. We have been bottoming for China far too long.
There isn’t really even a strong argument for importing the CT6 PHEV if the demand for luxury hybrids is all but nonexistent as alluded to above. Sounds like a weak business case either way.
Unfortunately, Americans suffer from a collective shortsightedness. That’s why we won’t give up our SUVs as long as gas is cheap and plentiful and your luxury PHEVs remain a poor business case regardless of country of origin. Most regular folk will choose a cavernous rolling brick over a Volt every time and the wealthy will always put their money in biturbo AMG Benzes. Tesla is the only notable exception to the luxury EV rule and their success largely comes down to buyers who are fascinated with and committed to tech and who see the car as a rolling testimony to their technocrat status and environmentalist leanings, more so than their desire to conserve actual fossil fuel and that’s why Teslas are ubiquitous in wealthy tech driven communities with short commute distances and largely unaccounted for just about everywhere else in the country. No formal studies have been undertaken to prove this, but most Tesla owners have a biturbo AMG Benz for longer trips and maybe a Ferrari or two for the occasional jaunt to the wine country. Anyway, I love that ballsy Elon.
Someday you’ll be like gawd dang jimmy that idiot boy was wright!
That day maybe closer than you think, I do not disagree with everything you say.
A lot but not everything.
I bemoan GM and Cadillac gambling their recovering reputation at the worst possible time.
I hope the people that buy these Chinese imports get lead poisoning.
Written on your Chinese imported item.
Colour you hypocritical.
Actually, it was written on a assembled in USA moto x. And both of my vehicles were more than 75% American. All my cookware/ appliances are made in USA. Even my flat screen was assembled in the USA so you know what they say about people that make assumptions.
Fair enough!!
You have to go to Flint for that.
Cadillac’s decision to import their CT6 Hybrid from China is simple, Cadillac expects to sell as more CT6 Hybrids in China than the 3.0 Twin Turbo and hopes the CT6 Hybrid will sell better than the ELR in the US as why invest tens of millions to build cars that no one will buy.
Well if anyone had taken the time to really understand the though here of what is going on you would better understand the why.
GM is going to sell most of these cars in China. The Chinese government makes it easier to build this car in China vs. here and then trying to import them.
So if you are going to sell 85% there and you are going to have an easier time building them and selling them there where would you build them?
The numbers sold here will be very low as this will not be a cheap car or one in high demand here. But In China it will be an important car as they are really pushing this kind of car on the market.
Even now the Tesla is having trouble over there and part of the problem is they are not made there and are difficult to import. Musk now is considering moving production for some of the S and all of the 3 there so he can sell the cars and then figure out the charging problems later.
The greatest selling model here will be the TTV6 and it will be built here along with a V8 in the future also built here
Look, I will NEVER buy a car made in China, or Korea, or Germany for that matter. Especially one that costs as much as this one. You can hype all the bs you want about global economy, the end result is lost jobs in America. It’s not just this car, or the Envision, it’s the begining of the end of American car manufacturing. Over the next few years, there is going to be a flood of Chinese cars coming into this country and most Americans couldn’t care less about buying American, they want CHEAP, that’s how Toyota nad Honda started. Christ, just look at Hyundai.
People jump up and down about jobs, jobs are priority #1, but there driveway is full of Japanese and German crap,and their house is full of Chinese crap.
The Chinese government restricts trade. Their policy is to limit imports and is essentially mercantilist. Therefore, the government wants to assure the greater percentage of goods consumed by the Chinese are built in China to bolster their own economy and they insist upon majority ownership of foreign automotive factories not only for the sake of maintaining a controlling interest but to gain intellectual property and technology. This is far too often excused and innocuously boiled down to “The Chinese government makes it easier to build this car in China vs. here and then trying to import them.”
China stacks the deck in their own favor and our government has dropped its trousers and subjected Americans to a decades long pounding. Our elected officials are supposed to protect Americans best interests. The intent of international trade agreements was and is to bolster the domestic workforce and increase prosperity, not decimate both, but as a direct result of ongoing lax US government policy on trade, we’re not only victims of a monumental trade deficit but can look forward to ever increasing demands for “redistribution of wealth” at home while more of our jobs and money quietly vanish overseas. This isn’t how free trade is supposed to work. It isn’t really trade at all when US consumers are left with no alternative but to purchase 90% of the goods they consume from the Chinese while China buys comparatively little from us and imposes stiff tariffs on imported goods to keep it that way. Our government has failed us and to even accept, let alone promote these ludicrous “trade” arrangements with China as the associated cost of living “in a global, interconnected economy” is an affront to every man, woman and child in the USA.
Conceding that we have very little choice but to enter automotive joint ventures with the Chinese in order to sell cars there completely changes the dynamic to something that might be loosely termed trade but without the the domestic job producing and exporting components that make international trade beneficial to us to begin with. Unlikely that Elon Musk will agree to turn over a controlling interest in any of his operations to anyone, just as he won’t acquiesce to the demands of independent dealers to shut down his factory stores.