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BMW, Mercedes Slugging It Out for Sales Title

Duel over luxury crown headed for photo finish.

by on Nov.11, 2014

BMW is holding a slim lead over rival Mercedes-Benz in the U.S. luxury market.

BMW and Mercedes-Benz are locked in a battle royal for the sales crown in the prosperous market for luxury cars in the U.S. BMW held the title for the two previous years, but one of the two has been the leader since 2011: the last year Lexus held the crown.

“One of the noteworthy facts in the October U.S. new vehicle sales results is that BMW now leads its archrival Mercedes-Benz by just 5,389 sales through the first ten months of this year,” IHS Automotive Analyst Tom Libby said.

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“With such a small gap in sales through 10 months, the two makes will most likely use marketing tools extensively through the end of the year, including numerous types of incentives, to gain an edge.” (more…)

Sales in a Slump, Cadillac Loses Another Key Executive

Global chief Ferguson returns to Washington as top lobbyist.

by on Jul.11, 2014

Cadillac's global chief Bob Ferguson with the 2015 Escalade during its NYC debut.

General Motors is looking for an executive to head up the Cadillac division, following the announcement that the luxury brand’s current leader Robert Ferguson has been named Senior Vice President, Global Public Policy.

It’s the latest in a string of top management departures for Cadillac, and comes at a critical time for the brand which is struggling to regain momentum as it rolls out key new products in a bid to reverse a sharp and unexpected sales dip.

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A veteran Washington hand who spent 10 years in the nation’s capital as AT&T’s top lobbyist, Ferguson had spent only two years as Cadillac’s global chief. But his departure isn’t entirely unexpected, as he has been splitting his time between the luxury brand and a key role as part of the management team responding to the recall crisis that has engulfed GM since February.

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Cadillac Loses Another Top Exec

Turmoil at the top as sales bottom out.

by on Jun.19, 2014

Bill Peffer becomes the third U.S. sales chief to leave Cadillac in less than two years.

This was supposed to be a big year for Cadillac as it rolled out new models like the CTS and updated Escalade, and solidified the gains of other recent models, such as the compact ATS and big XTS sedans. But instead of growth, the brand has been wracked with turmoil, losing a procession of senior managers as sales have unexpectedly tumbled.

Cadillac’s only recently hired U.S. sales chief has left the company for supposedly personal reasons. Whether he fell short of expectations, General Motors isn’t revealing, but the luxury brand’s volume was down 2.3% for the first five months of the year, a sharp disappointment considering Caddy had been anticipating double-digit sales growth in 2014.

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The departure of Bill Peffer, who joined GM just last autumn, is the latest in a series of executive departures, a list that includes former Cadillac global strategic development chief Don Butler, who left the company last August, and Peffer’s predecessor Chase Hawkins, who was fired as sales chief for “violating a company policy.”

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Cadillac Sales Stage Sharp Upturn

New products like ATS give Caddy a much-needed lift.

by on Mar.04, 2013

Cadillac is gaining momentum on the competition with new models like the ATS.

After a disappointing finish to 2012, Cadillac got some much-needed momentum when its new ATS compact luxury sedan was named North American Car of the Year. That big boost from a panel of 50 U.S. and Canadian journalists is clearly paying off.

Along with the traction it’s gaining from other new and updated products, such as the flagship XTS sedan, Cadillac is beginning to regain some of the ground it has lost in recent years to imports like Lexus, BMW, Mercedes-Benz and Audi.

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And with a remake of its mid-range CTS set to debut later this month, General Motor’s flagship brand is finally seeing some upside after years of decline, sales for the first two months of this year climbing by nearly a third over the same period in 2012.

Sean McAlinden, executive vice president of research at the Center for Automotive Research in Ann Arbor, Michigan, noted Cadillac is also benefitting from the broader revival of GM’s product development efforts. “This is the year GM product development catches up,” said McAlinden.

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Cadillac Soars, Lincoln Sags

January sales tell two very different tales.

by on Feb.04, 2013

A Cadillac ATS shown during filming of the sports sedan's debut ad campaign.

It was, to mangle Charles Dickens, the best of times and the worst of times for the two domestic luxury makers last month.

For Cadillac, January brought a sign of vindication suggesting that, after a slow start for the 2013 model-year, critical new products like the compact ATS sedan are finally building the sales momentum needed to help restore General Motors’ flagship brand to its former luster.

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For Lincoln, however, January delivered an unexpected setback, sales plunging by 73%, year-over-year, despite parent Ford Motor Co.’s strong aspirations for the luxury brand’s new MKZ sedan.

While Lincoln’s numbers plunged 18%, to their lowest level since the Reagan era, Cadillac posted its best performance at the retail level in 23 years, demand overall surging by 47%.

The new Lincoln MKZ reached showrooms late in 2012 and production has only slowly been ramping up.

“When you look inside the numbers, we’re even more encouraged to see our products building momentum, drawing new luxury consumers and expanding our brand,” said Chase Hawkins, vice president of sales for Cadillac.

The executive pointed to two key products for building brand momentum, the SRX crossover-utility vehicle and the new ATS sedan. Roughly the size of a BMW 3-Series, Caddy’s new 4-door has been winning wide praise since its launch last year, most notably being named last month the North American Car of the Year by a panel of 49 U.S. and Canadian journalists.

To industry analysts, one of the most significant measures of Cadillac’s rebound is the fact that it is rapidly gaining converts in the retail market, rather than by pumping cars into fleets, as it had done in the past. A full 94% of the brand’s sales were racked up at retail showrooms last month.

Of course, January alone won’t guarantee that Cadillac – which long billed itself the “standard of the world” – has truly recovered.  The maker has, in fact, been promoting its “renaissance” for more than a decade, ever since it introduced the dramatic “Art & Science” design language with the launch of its original CTS sedan.

But after some early signs of success, the promised revival faltered as consumers turned their backs on other edgy designs, such as the bigger STS sedan and the XLR sports car.

The arrival of the ATS and the XTS, the latter also new for 2013, appear to be putting the brand back on track, but analysts caution Cadillac will need to continue building momentum month after month.

And it will face another big test when it reveals the third-generation CTS sedan later this year. The first versions were so-called “tweener” cars, according to analyst Jim Hall, of 2953 Analytics, in Detroit, falling somewhere between the BMW 3-Series and 5-Series models.  With the ATS directly taking aim at the smaller of the Bavarian models, the 2014 CTS will move up in size – and price.

Cadillac has even more ambitious product plans in the works, including a replacement for the massive Escalade sport-utility vehicle. And it has hinted at product development programs underway that could result in a variety of other much-needed offerings, including a compact crossover, a convertible and other models.

For its part, Lincoln also is looking to broaden its appeal with a newer, more modern design language that will be shared across an expanding line-up of products. It has announced plans to introduce four new models by 2014 while Ford CEO Alan Mulally recently confirmed in a DetroitBureau.com interview that even more vehicles are now under development for the rest of the decade – including Lincoln’s first rear-drive passenger car since the aging Town Car was pulled from production.

The MKZ is the first step in Lincoln’s revitalization. But despite generally positive reviews, and what Lincoln officials had claimed to be record advance orders, January did not deliver a strong launch.

The entire brand’s line-up generated just 4,191 sales – less than the total for the Ford division’s Fiesta – and the lowest monthly tally since July 1981.

Despite that weak performance, company officials put as positive a spin on the results as possible.  A key reason for the slow take-off, they stressed, was not a lack of demand.  If anything, there are more customers waiting in line than for any product in Lincoln history, asserted Ken Czubay, Ford’s vice president of sales, marketing and service.

But in light of the problems the parent company had with the debut of the Ford Fusion – which shares the same underlying platform with the Lincoln MKZ – it’s perhaps no surprise the maker is putting the luxury sedan through a rigid inspection process that has sharply reduced production rates.

“We are going over them as we have never gone over vehicles before,” said Czubay, during a conference call discussing Ford’s January sales. “As we re-launched Lincoln … we know the quality finish of all of our competitors,” and wanted to ensure Lincoln would match the best it will face off against.

Despite the short supply, Lincoln went ahead with plans to advertise the new model – and to emphasize the brand’s transformation – on the Super Bowl, perhaps the highest-profile venue an automaker can participate in all year.

Lincoln took some flak when it previewed its Super Bowl campaign on Youtube, Mark Simon, the chief creative officer at Detroit’s Campbell Ewald – an ad agency that, until recently had long represented Chevrolet – offered a put-down on Twitter. The spot, chided Simon, “doesn’t change my opinion about the brand.”

Whether potential luxury buyers will agree remains to be seen, but it’s clear that Lincoln, like its cross-town rival, Cadillac, will have to change plenty of minds as it struggles to regain its former glory. And that will be all the more difficult considering the solid gains by rivals ranging from Porsche – which set a new sales record in January – to Lexus, Mercedes-Benz and BMW.

Both U.S. luxury marques have slipped well behind the imports and face the fight of their corporate lives to win back buyers. Ford Cadillac, January showed signs that this just might be possible. For Lincoln, the New Year is off to a worrisome start.

Cadillac, Lincoln Stuck in Neutral

Domestic luxury brands gain little traction in 2012.

by on Jan.04, 2013

Cadillac is hoping to see the ATS win North American Car of the Year honors, which could put its sales push back into gear.

The long-promised revival of Detroit’s two main luxury brands failed to materialize in 2012 despite the launch of some major new products that generated largely positive reviews.

Both Ford Motor Co.’s Lincoln and General Motors’ Cadillac wound up losing market share last year – 4.1% and 1.7% respectively — despite the makers’ anticipated improvements . Only the near-luxury GM brand Buick posted a modest, 1.6% gain for the year, though company officials insist the real test will come in 2013.

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That’s quite likely the case, says David Sullivan, of AutoPacific, Inc. “Looking back at 2012, I would say they were semi-disappointing and if we didn’t know there was promising new product in the pipeline it would be pretty bleak.”

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Cadillac Takes Aim at Lexus

Compact CUV could undercut rival’s crossover dominance.

by on Aug.30, 2012

Cadillac's new ATS may soon have a lot more company in the showroom - including a compact CUV.

Once the reigning U.S. luxury brand Cadillac is eager to reclaim lost ground and has put a target on the back of Lexus, which was itself the best-selling luxury brand until last year’s Japanese earthquake violently disrupted production.

The 2013 model-year will be a big one for the U.S. maker, as it rolls out both the new ATS compact luxury sedan and the more upscale XTS.  Cadillac is also working on plans to expand its line-up even further, officials now openly discussing plans to add a compact crossover – as TheDetroitBureau.com first reported.

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When asked about which brand was likely to windup to “donate” some market share as the deck is reshuffled in the luxury, segment, Cadillac’s marketing boss Don Butler didn’t hesitate – “Lexus,” he said, suggesting it certainly has a large pool of owners who could be persuaded to try something different.

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GM Posts Sales Gains in July, Up 5%

Remaining four brands are now clearly growing. Can GM recover from its decades long share and sales decline?

by on Aug.03, 2010

The question remains how well GM is doing relative to other automakers. Quick answer - lousy.

Dealers for General Motors delivered 25% more vehicles in July from its surviving Chevrolet, Buick, GMC and Cadillac brands for a total of 199,432 units when compared to a modest July of 2009.

Overall sales year-to-date were up 5.4% to 1,280,213 units compared to 1,143,799 last year. However, the industry was up 14.7% during the same period, meaning the GM continues to lag sales trends.

GM said U.S. auto sales for the industry ran at a seasonally adjusted annual rate (SAAR) of 11.7 million units in July, compared to 11.2 million a year ago.

Another potentially troublesome trend was a decline of -3.8% in retail sales year-to-date as fleet sales are increasing.

Incentive costs also remain relatively high with $3741 on average required to move each unit of metal, according to J.D. Power.

GM sales executives defended the incentive spending by introducing a new metric – the percentage of incentive per average transaction price. Here, GM at 10.6% YTD is in much better shape than the same period in 2009 when it was 14.6%.

Don Johnson, vice president, U.S. Sales Operations said that average transaction prices are up $3800 YTD and incentives are down -$730 to $3270 per unit.

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June U.S. General Motors Sales Up 11%

Chevrolet, Buick, GMC, Cadillac Increase 36%, but not enough to offset the lost sales from the now defunct four brands.

by on Jul.01, 2010

GM hasn't stopped the sales loss caused by closed brands. New models are strong, though.

Dealers for General Motors delivered 195,380 vehicles in June compared with 176,574 one year ago when it was in bankruptcy, a gain of 10.7%.

It remains in the Number One Spot in U.S. sales. by a healthy margin.

However, in May of this year GM sold  222,000 vehicles, so June represented a setback in what was a slow recovery in vehicle sales.

Year-to-date, GM sold 1,080,521, or 13% more than the corresponding year earlier period. The industry is up 17% for the same period.

This is 17,022 fewer units CYTD than 2009, when the now cancelled Hummer, Pontiac, Saab and Saturn brands were still operating. The overall market is up 17% YTD through May. Therefore, GM  is lagging the movement in the market.

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GM prefers to cut the numbers differently, pointing out that June sales for Chevrolet, Buick, GMC and Cadillac increased by a combined 36% to 194,828 units in the United States. This is the sixth straight month in which sales for GM’s remaining brands increased year-over-year by more than 20%.

Year-to-date sales for the four brands also have risen 32% to 1,069,577 units – an increase of 258,368 units compared to last year.

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GM May Sales Up 17%

Company is showing signs of a recovery, but more retail sales are needed among the surviving brands.

by on Jun.02, 2010

Dealers for the four remaining brands at General Motors – Buick, Cadillac, Chevrolet, GMC – sold more than 222,000 vehicles in May, up 32% from the year earlier when GM was bankrupt. Retail retail sales were up 11%.

This is the fifth consecutive month of double-digit increases, but if you look at the sales total of the previous eight brands, GM’s turn around is running at a sales increase of only 17%. How this tracks with the industry won’t be clear until late today when final May sales numbers are available, but preliminary estimates show an increase of about 19%.

GM’s fleet sales are running at about, gulp,  37% of the total, which works against the profitability the  taxpayer-owned company needs to achieve so that it can go public again.  GM  executives say the plan is to trim fleet to 25% by the end of the year. Incentives at an average of $2,250 per vehicle are up $200 a unit from April. Toyota’s aggressive incentive programs appear to be damping attempts by makers to raise prices now that inventory levels are under control due to the massive cutbacks invoked last year.

Year-to-date sales for GM’s four brands have risen 31% to 874,749 units – an increase of 206,994 units compared to a year ago.

GM’s newest products are doing particularly well. Year-to-date, combined sales of the Chevrolet Equinox, Chevrolet Camaro, Buick LaCrosse and Regal, GMC Terrain and Cadillac SRX and CTS Wagon are up 323%.

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