Co. confirms plans today to invest $190 million at a Lansing, MI, assembly plant, clearing the way for a small Cadillac sports sedan and giving the brand an entry in the meatiest segment of luxury sales.
“America’s fastest-growing luxury brand this year is about to get even more competitive with the addition of an all-new small luxury car,” GM CEO Dan Akerson says in a statement announcing the investment at the Lansing Grand River facility.
Known internally as the ATS, the car would compete against the likes of the3-Series, Audi A-4 and Mercedes-Benz C-Class in a segment commanding 39.5% of total luxury sales in the U.S. through September, according to Ward’s data.
The booming middle-luxury cross/utility vehicle segment remains a distant second, with 24.4% of sales.
Cadillac also needs an entry in the lower-luxury segment to become a truly global brand. The division currently is rebuilding its sales channel in Western Europe, which went under with the bankruptcy of its distributor during the recession.
But perhaps more importantly, Cadillac needs the volume car in its home market.
U.S. sales for GM’s toniest brand have been rising this year, as Cadillac builds out its portfolio, a lending freeze thaws and its parent recovers from bankruptcy.
Cadillac deliveries through September soared 43.8% to 105,013 units, from 73,024 during the recession-plagued 2009. It’s the biggest jump in volume among the major luxury players.
Cadillac car sales in the period grew 7.1% to 50,156 from 46,819, and deliveries of its bread-and-butter CTS line were up 12.1% to 32,516 from 29,011.
But underscoring the importance of a lower-luxury entry,-brand sales to date are at a segment-leading 192,052 units, or nearly twice Cadillac’s volume. BMW AG’s car sales, including Mini, are up 3.5% to 157,465, with the 3-Series leading the way on 73,395 deliveries and a whopping 18.1% of the segment.
Globally, BMW sold 397,103 units of its 3-Series last year, down from 474,208 in like-2008, when the recession was not pummeling auto makers. Either way, the 3-Series accounts for more 37.2% of the BMW-brand’s worldwide sales, according to the company’s annual report.
Mercedes-Benz sales in the U.S. climbed 15.1% in the first nine months of this year, to 170,381 units from year-ago’s 148,082, good for second place among luxury sellers. Its entry-level C-Class owns 11.4% of the segment on sales of 46,160 units, up 17.1% from like-2009. Total car sales for the brand are up 20.4% to 107,083.
The new Cadillac widely is expected to ride on the auto maker’s Alpha platform, a global compact rear-wheel-drive architecture delayed by GM’s bankruptcy and uncertainty over a then-pending hike in federal fuel-economy rules.
GM has not shown the ATS publicly, but Ward’s was among a number of media outlets and Wall Street analysts to be offered a sneak peek last year. The car shares the same sharp lines as other Cadillac products but is noticeably compact, with wheels stretched to the corners for nimble stance.
At the time, GM design chief Ed Welburn said the auto maker planned both sedan and coupe versions of the car, with the first version to come in 24 months, putting it on track for next summer.
But GM today offers no timetable for the ATS. The auto maker also wants to bring to market a new large sedan, currently called the XTS and shown in concept form as a hybrid at the Detroit auto show earlier this year.
It is suspected future vehicles could be added to the Alpha platform, such as the Chevy Camaro, and that LGR could become a hub for GM’s RWD production. LGR currently makes the CTS sedan, coupe and wagon. High-performance V-Series variants of each model also are built at the 9-year-old plant.
GM says the LGR investment will create 600 jobs and adds a second shift to the plant, which currently runs at 50% of its normal capacity. It brings GM’s investments in the U.S. since emerging from bankruptcy last year to $3.1 billion, resulting in some 7,900 jobs.
“This investment demonstrates GM’s commitment to Cadillac and to a strong U.S. manufacturing base,” Akerson says.
GM’s bankruptcy last year shed thousands of jobs at the auto maker, jettisoned four brands and shuttered a number of assembly plants that today remain either on standby for future product, sold off or closed permanently.