Cadillac won’t discount prices to improve sales

Cadillac’s new boss, Johan de Nysschen, formerly CEO of Infiniti, has publicly stated that the brand will hold the line with prices, despite sagging sales.

Numerous reports state that Cadillac has an overabundance of new model ATS and CTS sedans in dealer lots and in holding pens. The company sized up its CTS to beyond BMW 5-Series/Mercedes-Benz E-Class dimensions with the launch of the new models, as it wanted to leave room for the BMW 3-Series/Mercedes-Benz C-Class-fighting ATS.

Along with the size realignment, Cadillac also decided, at the same time, to bring its prices into much closer alignment with its German competition.

Speaking to Automotive News, de Nysschen said that “either you have to bring your volume aspirations into alignment with reality and accept that you will sell fewer cars. Or you have to drop the price and continue to transact at the prices where you were historically. I think the logical conclusion is that it’s better to build off a very solid base in terms of [product] credibility, charge a fair price for the car and realize you have to wait until the volume comes.”

Cadillac sales breakdown by model

As you can see in the chart below, sales of the CTS dropped off markedly when the new entry-level ATS was introduced. Instead of having two high selling models, the brand now has two models doing slightly more than cumulative sales of the old CTS.

Cadillac sales versus its luxury competitors

Just in case you were curious, here’s how Cadillac is faring against its German and Japanese competition. Like Acura and Infiniti, Cadillac is fair distance behind BMW, Mercedes-Benz and Lexus.

Source: Automotive News

Sales figures: Good Car Bad Car