The wonder of the luxury-car business is there’s so much money to be made from it.
Mercedes andare making billions. I recall, a couple decades ago, that ’s Lincoln Town Car, alone, was earning $1 billion a year.
Ferdinand Piech is trying to moveout of the “people’s car” business and into the “rich guy’s car” business with models such as the Phaeton; and brands such as Bentley, Lamborghini, Bugatti and the expansion of Audi.
wants to grow Alfa Romeo and Maserati. I suppose we’ll see a luxury version of the $2,500 Nano one day.
But is there a place for Detroit in the luxury-car business? Despite the success of the Cadillac CTS, the Detroit auto makers are being whipped now, even in their home market, let alone the global luxury car business.
Last year, Cadillac ranked fourth in luxury brand sales in the U.S., behind Lexus,and Mercedes. Lincoln was a distant fifth.
is out of the luxury-car business. Does anyone even remember the Imperial, or the very classy old Chrysler models?
’s luxury plant in Wixom, MI, is shuttered. Lincoln has a lineup, but the strangely named MKZ and MKX are dolled-up versions of Fords.
The Town Car will be gone soon. The question is, can a luxury division be built with gussied-up Fords? Another luxury model, the MKS, is coming soon. It’s big enough, but it only has a 6-cyl. engine. And the Lincoln MKS will be built in the same plant that builds the Ford Taurus.
There’s no question Ford wants to build up Lincoln. Most are sold in Lincoln Mercury showrooms, and the idea seems to be to phase out Mercury and build up Lincoln.
Trouble is Ford hasn’t shown any flair for luxury lately, and it is about to sell Jaguar and Land Rover.
There has been some talk of a rear-drive sedan somewhere down the road, but it’s difficult to put much faith in the talk, considering Ford’s neglect of the once hugely profitable rear-drive Town Car.
The only real domestic player seems to beand Cadillac.
But no Cadillac competes in the top end with $70,000-plus big dogs, such as the Mercedes S-Class, BMW 7-Series and Lexus LS.
One size down, the Cadillac STS is sinking fast against the Mercedes E-Class and BMW 5-Series, with only 21,000 sales last year, less than half BMW and Mercedes sales.
Yes, in the U.S. the CTS is competitive against smaller and midsize Mercedes, BMW and Audi models. A gorgeous coupe is coming to join the 4-door. But the larger DTS (formerly the DeVille) is fading.
The big Escalade SUV is a success, but not other models with monikers such as XLR and SRX.
There was to be a new model in a few years, a big, rear-drive car replacing both the STS and the DTS. That’s been needed for 20 years, but the way GM is ducking big, rear-drive car programs, I’m not sure it will happen.
Then there’s been talk of a smaller Cadillac, but again, it’s just talk right now.
Meanwhile, foreign luxury auto makers have plenty of money to invest in radical engineering. The Germans put powerful diesels in their luxury cars; still build 12-cyl. engines, plus an array of high-powered specialty models, such as Mercedes AMG and BMW M models. And they can stomach paying gas-guzzler fines when the lineup doesn’t pass U.S. fuel-economy standards.
Cadillac does offer its powerful V-Series performance models, but unless Detroit auto makers make a determined effort with a well-developed plan for moving up and expanding their product lines, they’ll wake up in three years and find the luxury-car business is another lost cause.