Cadillac, Lincoln Claim Big Stakes in Luxury Segment

September 18, 2010/Steve Tackett

MOTOR MATTERS DOWN THE ROAD BY HERB SHULDINER

Despite the recession that just won’t go away there are still car buyers who have the money to buy luxury cars. For the most part, premium car buyers have typically turned to imports for their pricey rides, such as Lexus, BMW and Mercedes-Benz.
One serious obstacle to the domestic carmakers is that their portfolios are limited compared to the imports — both in the number of models and powertrain options. However, U.S. luxury nameplates Cadillac and Lincoln are re-establishing themselves as relevant choices in the luxury segment.
Cadillac is making a big push for recognition with an all-new 2011 CTS-V, a 190-mph, 556-horsepower sports sedan. Interestingly, a growing market for the CTS-V is in China where buyers pay as much as twice the U.S. manufacturer suggested retail price of $62,165 for this high-performance sports car.
“My hope is China becomes a significant presence for us,” says Jim Vurpillat, Cadillac’s global marketing director. He also says that Russia is another market in which Cadillac hopes to grow its sales volume. “Long term, we’ve felt that up to 25 percent of Cadillac’s volume could be sold outside the U.S.,” he says. Vurpillat notes that Cadillac is exported to 35 countries.
Jim Farley, chief of global marketing for the Ford Motor Co., doesn’t believe Lincoln needs to target fast volume growth domestically, or establish global markets.
“Why would we want to distract our engineering team with world requirements when our focus is on North America?” he states. “We need an engineering team that’s scoped on Lincoln’s future.”
“The most important metrics for our (Lincoln) customer is resale value (which has improved 6-10 points) and craftsmanship and technology in our vehicles, Farley says. “We’re looking for more progressive customers who care about fuel efficiency.”
Toward that end, Lincoln unveiled its first hybrid car in the nation’s capital. The 2011 MKZ Hybrid shares the same second-generation hybrid powertrain as the Ford Fusion Hybrid, but comes in a premium package designed to appeal to luxury buyers.
Lincoln engineers targeted the Lexus HS 250h, the leading luxury hybrid — aiming for better performance, fuel economy and quiet operation. The marketing executives also gave MRZ an aggressive starting MSRP of $35,180, identical to the price of the conventional gasoline fuel MKZ sibling.
Cadillac doesn’t yet have a hybrid in its product portfolio. But it outperforms in the crossover utility segment with its SRX and in the big SUV segment with the iconic Escalade. Lincoln hopes to cut in on Cadillac’s SRX market share with an all-new MKX crossover model that debuts this fall.
General Motors’ Vurpillat forecasts that total Cadillac sales will exceed the 92,000 units that the brand retailed last year. That’s still a long way from catching up with the Japanese and German leaders in the luxury segment.
Farley is less interested in volume growth than he is in getting Lincoln’s basics right. He describes the current state of Lincoln as foundational. “We’ve reestablished that foundation with (coming) new products,” he says. — Herb Shuldiner, Motor Matters

Copyright, Motor Matters, 2010

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