Cadillac Looks to New Large Sedan to Boost Sagging Sales

The luxury brand’s global marketing director tells WardsAuto the year’s second half will see the new XTS exceed the combined 2011 sales of the defunct STS and DTS models.

Herb Shuldiner 1, Correspondent

June 22, 2012

3 Min Read
XTS primarily North American model but also will be built in China
XTS primarily North American model but also will be built in China.

NEW YORK – Cadillac launches its new ’13 XTS flagship model just as inventory of the two large sedans it replaces, the STS and DTS, dwindles to barely 100 units.

General Motors’ luxury-brand deliveries tumbled 36.7% through May, compared with year-ago, WardsAuto data shows.

However, Jim Vurpillat, Cadillac's global marketing director, tells WardsAuto at a press conference here that the year’s second half will see the XTS exceed the combined 2011 sales of the two defunct sedans.

That will boost Cadillac's overall results this year, which Vurpillat forecasts will surpass the 149,000 units delivered last year.

He estimates the mid-price luxury segment, which includes the Audi A6, BMW 5-Series and Mercedes E-Class, will enjoy sales approaching 500,000 units this year. “(But) I don't want to speculate on what the XTS share will be or its volume.”

The XTS has a lot going for it. The 200-in. (508-cm) long vehicle has 40 ins. (102 cm) of rear legroom. “That's more than the (BMW) 7-Series or (Audi) A8 have,” Vurpillat claims, noting the XTS is the only model in the segment that has magnetic ride control.

The XTS also is loaded with safety and infotainment features, including Cadillac’s new CUE system, which will strongly challenge the technology-loaded German competitors. He also claims the driving dynamics and ride comfort of the XTS is something a buyer might not get from the German brands.

“We do large luxury sedans well,” Vurpillat says. “The XTS, with its unique blend of luxury and technology, broadens and enhances our portfolio.”

The XTS offers four trim levels: Standard, Luxury Collection, Premium Collection and Platinum Collection. “The Luxury Collection will account for 50% of sales,” Vurpillat predicts.

He estimates the premium trim will garner 25%-30% of demand, while the top-of-the-line platinum will make up 15%. The entry-level standard trim should account for 10%.

Starting price for the XTS is $44,075, increasing by roughly $5,000 for each step higher on the trim scale. An XTS all-wheel-drive Platinum Collection model tops out at $60,385.

Vurpillat emphasizes the XTS primarily will be a North American model, even though it will be produced in China starting later this year. A plant outside Shanghai will assemble the sedan with the same content that customers here will get. AWD will be available on the units built in China.

Last year, Cadillac sold about 30,000 units in China. That will climb to about 35,000 in 2012, Vurpillat says.

Cadillac plans to export the XTS to markets in the Middle East, which also will get the smaller ATS model later this year. The brand already distributes the SRX, CTS and Escalade in the region, and Vurpillat expects overall sales to range between 5,000-7,000 units this year.

However, Cadillac has experienced slow going in attempting to establish itself in the European market. Ever since its Dutch distributor went bankrupt, the brand has managed to retain only 38 dealers in the region.

“The launch of the ATS will represent us coming back to the European market,” Vurpillat says.

“But we don't have huge volume aspirations over there. The new XTS will not be sold in the region,” he adds. “We don't want to play in that segment in Europe.”

Cadillac is reluctant to compete now against the A6, 5-Series and E-Class in Europe. But the SRX, Escalade and CTS will be available, along with the ATS.

Vurpillat says Cadillac delivered 25% of its volume abroad in 2011. Foreign sales so far this year are running at about 27% of the brand’s overall volume. “When we get to a steady state above 30%, then we will be a true global market player.”

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