Monday, October 14, 2013

I’d Buy That For – Actually, No, I Wouldn’t…

There’s a new product coming out this winter from GM that has great potential, both in bringing the company into new product categories and selling a lot of units, but about which I find that I’m dubious. All hype aside, it’s basically a Cadillac version of the highly controversial Chevy Volt hybrid – with all of the elaborate body-styling, leather interior and other optional extras that implies. But the guts of the vehicle are virtually identical to those of the Volt, including the troublesome (and occasionally incendiary) battery pack, performance should be similar in all categories, and without the Volt’s hatchback the design may look better, but is significantly less practical – all of which is a problem given that the Cadillac version is priced at over twice the MSRP of its Chevy progenitor…

You can read the Wired online story about it if you want to, but they’re not that positive about the car either. For one thing, the $75,000 GM is asking for the Cadillac ELR is high enough that you could purchase a number of highly-regarded competitors for the same money, including the Tesla Model S, the Mercedes-Benz E-Class Hybrid, the BMW 5-Series Hybrid, the Acura NSX and the Porsche Cayenne Hybrid instead. For another, the ELR has a number of optional features that remain unreliable, even apart from the power plant, like the CUE entertainment system. But mainly what they are questioning is whether adding the Cadillac nameplate and logo will be enough to double the price people are willing to pay for the vehicle – and there is historical justification for questioning that…

Some of our older readers (assuming I have readers) may remember a product called the Cadillac Cimarron from the 1980s’ – it was the compact car in the Cadillac line at that time, and the company had difficulty selling them because the Cimarron looked almost exactly like the Chevy Cavalier of the same period, only with some chrome bolted on and double the purchase price. This was, of course, because that’s exactly what the Cimarron was; the majority of the car’s parts were interchangeable with the Chevy and Pontiac versions (the Sunbird, in the later case), only at twice the price or higher. The ELR has all of the same problems, including the legacy of cars like the Cimarron to muddy the waters, but from where I’m sitting it has at least one problem that is even worse…

Consider the traditional customer demographic for the Cadillac line. Developed by GM specifically to create an up-market product for people who had grown too successful to drive Pontiacs or Buicks, the Cadillac has always appealed primarily to older customers from higher income categories, both as a demonstration of wealth and because they can afford the extra comfort of the car’s optional amenities. In recent years the brand has met with increasing popularity in several other segments, notably including the rap music community, because in addition to the established prestige associated with Cadillac, the vehicles can be easily customized to conform to the owner’s vision of status, showmanship and visibility. What I question is whether either of these groups will be interested in a small, cramped, under-powered and very expensive vehicle whose primary selling points are high gas mileage and low environmental impact…

There are environmentalists in both of these communities, of course. And we can easily imagine that at least some Cadillac buyers might find the idea of lowering their gas bill by as much as 75% to be intriguing. But such individuals have had access to other hybrid models for nearly a decade now, including the highly successful and relatively prestigious Toyota Prius; it’s difficult to imagine that anyone who is motivated by either lower emissions or higher gas mileage wouldn’t already have migrated into the hybrid market. If the ELR proves to be the equal of the Tesla, Mercedes or BMW offerings from a mechanical and efficiency standpoint it might be able to complete on value, but the company as a whole has been having difficulty competing for the luxury sedan market for some years now, and the questions about whether the bugs have been worked out of its systems will not help. Unless Cadillac can reach a new customer demographic with this product, or somehow convince their existing customers to start accepting the ELR’s strong points as being worth switching to, it’s difficult to imagine this ending well for GM…

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