Cadillac, with market-specific cars and a rapidly expanding dealer network, is increasingly a China-reliant GM luxury brand.
In four consecutive months, from April 2017 through July 2017, GM’s Cadillac division sold more new vehicles in China than in its U.S. home market. Indeed, so far this year, 48 percent of the Cadillacs sold around the world were sold in China. Thank a massive 67-percent year-over-year sales gain, stirred up by very healthy Chinese demand for the XT5.
But in August, for the first time since March, Cadillac’s U.S. dealer network reasserted its collective claim as the rightful nation for Cadillac sales success. That’s correct: Cadillac sold more vehicles in the United States in August 2017 than in China.
Albeit not many more.
U.S. Cadillac sales slid 8 percent to 15,016 units in August despite overall GM expansion, growth that can largely be credited to strong crossover gains at Chevrolet and GMC.
In China, meanwhile, Cadillac sales jumped 51 percent, a massive gain that continues Cadillac’s rapid China growth rate. But that 51-percent rise only took Cadillac’s China volume up to, wait for it, 15,014 units.
Two fewer than in America.This blip on the radar certainly doesn’t — and won’t — represent a trend. Cadillac’s U.S. volume has been sliding for much of the year. Only slight upticks in April and May broke a trend that’s seen Cadillac’s U.S. sales decline, year-over-year, in six of the last eight months. In a luxury market that increasingly favours utility vehicles, Cadillac has the exceedingly premium full-size Escalade (in two wheelbase lengths) and the XT5. But there’s not yet any competitor for the BMW X1, no direct Mercedes-Benz GLC alternative, no Audi Q7 rival.
That’s not to diminish the success of the Escalade, which outsells the Lincoln Navigator, Infiniti QX80, and Lexus LX570 combined. Nor would anyone suggest the Cadillac XT5 is anything but a success. The SRX’s succesor produced a 23-percent rise in U.S. Cadillac crossover volume in August, and the Cadillac XT5 currently ranks second among U.S. premium brand utility vehicle sales.
But Cadillac’s 7-percent year-to-date U.S. light truck sales increase is more than counteracted by plunging passenger car sales. Even with the CT6 adding sales to the car lineup, sharp declines from the Cadillac ATS, Cadillac CTS, and Cadillac XTS have brought the brand’s U.S. car volume down sharply compared with 2016. In the U.S., Cadillac sold 42,547 copies of the ATs, CT6, CTS, ELR, and XTS in the first eight months of 2016, but 23-percent fewer — 9,721 fewer actual cars — in the same period of 2017.
GM’s drawback from fleet sales has nothing to do with the Cadillac division’s decline, either. While retail sales at Cadillac are down 6.5 percent to 86,996 units so far this year — 88 percent of the brand’s total volume — Cadillac fleet sales are up 4 percent to 11,320 units.
The bright spot for Cadillac? Transaction prices. Cadillac charged an average of $54,000 per vehicle in the United States last month, up about $1,000 compared with August 2016.
Outside of China and the U.S., which account for 48 and 44 percent of global Cadillac volume in 2017, 4 percent comes from Canada and the scant remainder from the rest of the world. Global Cadillac sales are up 22 percent to 221, 566 units through 2017’s first eight months. Cadillac is on track to sell 161,000 new vehicles in the U.S. this year, a five-year low and a 25-percent drop from a decade ago.
[Image: General Motors]