smk4565

You mean Gen Y and the Millenials...plenty of 30-something and 40-something Gen Xers in the luxury market today.. Yes, but may 30 somethings are not yet in the luxury market. Most luxury car brands do attract people in their 50s and up. But from 2015-2030 those 30-45 year olds today will be nearing that age. The ideal car lineup is small ATS at $33-50k, midsize CTS at $45-65k and a rear drive full size sedan of $75-100k. I would add a sports car, doesn't have to be a $100,000 car, a $45,000 roadster could work. A super car would create more image though. I would also add a car below the ATS, but only after a legit flagship was in place. A $27-33,000 hatchback would get them international sales, and get younger buyers in America. Lexus was sort of after that with the CT200, but they made it ugly, boring and slow. Young people don't want that. They got the fuel efficient part right, but it has to be fun too.

In 2007, BMW had the highest percentage of fleet sales in Germany at 67% with Audi right behind them at 66% thus only about 33% going to private customers. By contrast, Mercedes sold 50.1% to private owners. While VW sold 47% to private owners, Ford 41% and Opel 39%. So Mercedes does sell more to private customers than other German domestics. But Mercedes wants fleet sales because their profit margin is very close to their retail sales. Daimler posted $6.3 billion in profit last year and so far 2011 is a record sales year for Mercedes, so they're doing fine. The thing is BMW and Audi are also doing well this year and the German trio is expected to grow and do well in the future. This is why I think Cadillac has to move fast, and expand globally. They can't rely on a North America only strategy, or cater only to past customers. I just read how of the top 10 car brands bought by Gen Y this year, zero are domestics. Gen X and Gen Y may not be in the luxury car market until the 2020s, but when that time comes Cadillac better have something to attract them, because those buyers favor imports heavily. This would be the one case I would approve of a FWD Cadillac, is for a hot hatch type of car like a Golf GTI or Mini but with more luxury.

Fleet sales don't hurt Mercedes in Germany or anywhere else in the world either. If fleets sales were hurting them so much in Europe, Lexus or Infiniti or Cadillac would have broken into the market. The German trio dominate China and Europe, and Mercedes and BMW and #1 and #2 in North America now also. Mercedes in 2011 is actually having a record sales year, they are up in England, Sweeden, Germany, China, USA, Japan, and Middle East. Their image seems to be fine, they perform near the top in every market. Global luxury sales first 6 months of 2011 BMW: 689,861 Audi: 652,950 Mercedes: 610,531 This is largely due to Mercedes being #3 in China, selling 30,000 fewer cars than BMW and 50,000 fewer than Audi there. Audi is the choice of the Chinese government (A6 is the #1 selling luxury car in China), which helps boost sales volume there.

Fleet sales do not hurt Mercedes. They almost seem to enhance their reputation as 97% of all governments own an S-class, and over 100 own an armored S-class limo, and many leaders and dignitaries are driven around the fleeted out cars. You may not like how they operate, but they are in 1st place and have been the most successful luxury car brand worldwide over the past 30-40 years. The question is how does Cadillac (circa 2015) put a vehicle lineup, marketing strategy, etc together to compete with the top tier brands. Cadillac staying status quo and hoping for Mercedes to fall apart is not a good plan.

Now if you're talking worldwide volume, I'm certain that Cadillac won't expand worldwide and then fleet itself out like Mercedes and BMW do. However, everything else you said in this comment is spot-on. I was thinking global volume, and perhaps not the million units a year that Mercedes sells, but maybe 400-500,000 units. The profit margins and image I am more concerned about.

The goal of Cadillac should to have Mercedes' volume, price margins, customer loyalty, reputation, image, etc. The goal is to make the Wreath and Crest carry as much weight as the 3-point star. Everything Cadillac does should be done to put them in a position to be on par with Mercedes, that is why I dislike the SRX, and XTS, those are distractions and quick fixes, they aren't solving the problem.

I already explained why. The two cars aren't even comparable because they're aimed at different markets. Now if someone could prove that the E63 handily outsells the CTS-V, then you make a better point. I don't think either brand breaks down sales by specific model, could be hard to find out. But look at the price gap also, if the CTS-V was $90,000, they would sell like 10 cars a year. Nothing Cadillac makes is directly comparable to Mercedes because they operate in such different price brackets, due to the massive image gap between the two. This is the gap Cadillac has to narrow. I just priced an E350 with 4matic, Premium package 2 and the driving nannies like Distronic, night vision, blind spot, parking aides, wood/leather steering wheel, rear air bags, message seats, etc. Pretty much everything but dealer accessories, AMG wheels, panoramic sunroof, and rear seat DVD system. Price is $69,905. This is the difference between Cadillac and Mercedes. Cadillac could not price a V6 CTS at $70,000, they would be laughed at. Perhaps even more scary, is the options list on the S550 can total near $40,000, that's a whole Cadillac just in options, or 3 Fiestas.

I wasn't meaning to say sales volume equals superiority, but to point out the brand image difference. Dwight suggested a 470 hp 25 mpg V8, yet even with 556 hp, more people would take a Mercedes with a 268 hp V6 for the same money. Big engines and 0-60 time aren't enough, Cadillac has an image problem. Any muscle car can crank out horsepower, the image has to be repaired by more complex measures, such as refinement, build quality, and technology. And Mercedes did sell over 825,000 W126 S-classes, that is pretty big volume for a top end luxury car.

3 red letters on a Chevy truck.

I agree with what Hyper has been saying. Cadillac does need to adapt to get the current luxury buyers plus those that haven't entered the luxury market yet. Image does play a huge role in luxury cars. Of course people say "I've always wanted a BMW" or "I've always wanted a Mercedes" because they build the best and most expensive cars. They built their reputation over the past 30-40 years while Cadillac let theirs weaken. Driving a Cadillac (or Lexus or Lincoln) means you are an old person or that you couldn't afford a BMW or a Benz. The image just isn't there for those brands. Image building is what Cadillac needs, that is why they need to get focused and build some top end cars. Cadillac is clueless from a brand management standpoint. The CTS-V may have 556 hp, but the 268 hp E350 that is easily optioned up over $60,000 probably outsells the CTS-V by large margin. Even with all that horsepower, Cadillac can't overcome the 3-point star.

So undercut the Germans by $10-20,000 to compete on price. Then make versions of the Chevy Tahoe and Equinox to be unique? I agree with your statement, but Cadillac is not doing that. Mercedes and BMW are the 2 that make unique products and they are the top sellers in the luxury game.

In general the S-class is 10 years ahead of the field, but I know not always on everything. If you look at a 2000 S-class and the features and technology on it, it would rival or beat $50,000 cars of today, and for sure outmatch the entry level luxury class. But they are obviously committed to the car also. Since the 1970s the S-class has been the car everyone has been chasing. If Cadillac plans to go into that field, they better go all in. Because the S-class is about to go into its 6th model year and it is still outselling brand new models from Jaguar, BMW and Audi.

I do think Cadillac needs 30-40 mpg cars, if they don't do it with hybrid they can do it with diesel. They need diesel anyway to sell outside of the USA. While I agree that hybrids don't make much volume, it does give a technologically advanced image to a brand. Flagship is a big problem for Cadillac, they are going to have to make it the size of the XTS, yet charge twice as much. So that could be a hard sell. Then we are looking at Sigma or Zeta rehashed; by 2015, those are 10 year old platforms. And will Cadillac spend the money for it? I think a Cadillac flagship is essential to legitimize American cars and build image, but I am skeptical in them doing it right. ATS convertible is needed, but not enough. BMW makes 3, Mercedes makes 4, Audi makes 3. Cadillac needs a purpose built sports car, whether that is in the Z4/SLK class or at something higher end I don't care which. I find the CTS 2-door to be a horrible looking car, it looks tacky, overweight, and big butted. But even the fans can't say it is a better looking 2-door than a Jaguar XK or Maserati Gran Turismo.

At their peak sure, but the Deville/DTS peak was 10 years ago, most of those buyers are shall we say, not looking for a new car. Big luxury sedans in general do not sell much volume, the front drive ones do worse than the rear drivers. The XTS is catering to a dying market. And the XTS is a gussied up Buick (and future Impala). It is exactly what Ford does with the MKS and Acura does with the RL. Cadillac might just execute it better. The XTS is made to appeal to the Cadillac buyer of the 90s, I think they are wasting their time. Cadillac needs to move on and build the future, not the past.

Crossover buyers are mostly sheep. They'll buy what they perceive to be good, that is why the Lexus RX wins the sales crown every year. I'd rather Cadillac make the SRX rear drive, but I would never consider buying any crossover, and I know the market doesn't care. so I have less problem with the SRX being FWD than I do the XTS. I mainly don't like the SRX being front wheel, because it will no doubt lead to more front wheel drive Cadillacs. XTS won't sell 5,000 cars a month, the DTS sells about 1,000 the Lincoln MKS about 1,200. Town Car and STS are dead, S80 and Acura RL don't sell. This is the type of car it is. How is the XTS going to sell at E-class levels, where will the buyers come from? Aside from funeral homes. The ATS might be good, I am glad we know not much about it. I am eagerly awaiting it, because it is probably the only Cadillac in the next 4-5 years that I'd consider.

According to Dr. Weber they will do it; this is the company spending $2.5 this year on alternative fuel and hybrid technology. I read this article a little while ago: In an interview with Car and Driver, Mercedes development director Dr. Thomas Weber said "Three years ago, everyone thought that there would only be small cars and that there would be no more large cars. But our plug-in concept demonstrated that an S-class could make 78 mpg (3.0 L/100km), so those questions stopped. With the next generation of S-class we are talking 81 mpg (2.9 L/100km), using a new-generation 3.0-liter V-6 gasoline engine-direct injection and piezo injectors-integrated with a 60-hp (44 kW) electric motor. In pure-electric mode, the car would have a range of just over 20 miles (32.2 km) at speeds of up to 68 mph (109 km/h). It is clear that we will have a plug-in hybrid in the next-generation S-class." 81 mpg Euro is about 70 mpg here. If they do this, (and I think they will because the S-class is always 10 years ahead of its time) no other car maker is close. The new S350 bluetec has over 450 lb-ft of torque and gets 30 mpg highway, that is still well above big car standards. The next S-class is supposed to drop weight from the W221 model, but cars seldom drop weight. Although when they went from the W140 S-class to the W220, there were considerable weight savings, so I know Benz knows how to do it.

Yet for all their faults they are the #1 selling luxury car in the world, selling over 1 million cars a year and they make billions in profit every year. The C-class turbo 4 arrives this fall, the C-class and S-class also get diesels soon, that will solve some of their fuel economy woes. The next S-class is said to get over 70 mpg while doing 0-60 in under 5.5 seconds. No automaker is even remotely close to that, that is game changing. You can keep thinking what Cadillac is doing and has done for the past 10-20 years is the path to success, but look at their brand. Sales have been on steady decline over the past 20 or even 30 years, they have almost no sales volume outside of North America and their product line is now 1 mid size car and 2 SUVs. Cadillac is a dying brand, there was a blip from 2003-2005 when they showed a little sign of life, but they are flat lining again. They aren't as bad off as Lincoln, but in 5 years they could be.

I was never really a big promoter of the XTS should be a Buick campaign, I more think that the XTS shouldn't even exist because a $50,000 front wheel drive car is stupid. I also don't think Buick competes with Lexus, unless by compete you mean they both attract buyers over 60. Buick is a $25-40,000 manufacturer, and today most mainstream brands like Ford, Chrysler, Toyota, and Hyundai live in that space also. Cadillac should be more like an Infiniti or European car. Even Lexus tries to make a couple sporty cars to balance out their old geezer ES, Lexus just isn't any good at sport sedans. The 40-60 year old luxury car buyers aren't too interested in land barges and float mobiles that their parents drove. Gen X and Gen Y (for the most part) are buying smaller, nimble handling, fuel efficient cars and they like technology and style. Cadillac right now still builds to a midwestern America baby boomer and older demographic. Cadillac needs to broaden its appeal. Where is Cadillac's 30 mpg car or better yet 40 mpg car? Where is the DOHC V8 that Infinit, Hyundai, Benz, BMW, Audi, Jaguar, Lexus all have Wehre is the 7 or 8 speed transmission? Where is a real flagship? Where is the sports car or convertible? Can you imagine BMW, Mercedes, Audi or Jaguar with no convertible? Even Infiniti and Lexus have them. Where is Cadillac's image? They are part BMW wannabe, part rap video truck, and part retirement home geezer cruiser. There is no focus.

Styling -- I think they are on track Interior Quality -- A little demerit here and there, but they are 90% of the way there Differentiated Features -- Electrochromic windows, magnetorological shocks, something special. Performance -- between a 2.0T & 3.6 DOHC V6, plus a small block powered V they are set as along as they keep weight in check Value -- Don't price yourself out of the market; even Lexus started out selling the LS400 at a $20K discount over the Germans Thing is though, magnetorological shocks are still an adaptive suspension that reacts to what it hits. And Audi and Acura use it also. Mercedes is working on a suspension that reads the road before the car hits it, so the suspension can adjust before the car hits the bump. Everyone has suspensions that react, but only Benz will have one that prepares, that is special. On performance, I do think Cadillac needs a DOHC V8, but horsepower isn't really a Cadillac problem. The E-class is the #1 selling mid-size luxury car and it is far from the most powerful. I think the problem is in the ride/handling department.

This is their biggest challenge and something Cadillac (nor Lincoln) has been able to do for the past 15-20 years. That is why their sales volume kept dropping. The CTS brought in a new buyer compared to the old Seville and Deville/DTS, but I wonder how much of that was import luxury conquest compared to mainstream buyers moving up to a luxury car. I think Cadillac's areas for improvement need to be build quality, fuel economy, and driving dynamics. Especially for overseas markets. The CTS is their only car that is decent at driving dynamics and even it didn't wow me in anyway when I drove it. A BMW is a much better driving car. Cadillac loses the performance buyer to the Germans and the old folks that want worry free and good mileage buy Lexus. So they have to find a way to appeal to those buyers.

S-class still outsells the A8, Lexus LS, or 7-series by 2-1 margin. All 3 of which are about $20,000 cheaper and have had redesigns since the current generation S-class went on sale in 2006. It still dominates the segment.

The economy is hurting when the S-class is down, even the super rich seem to be cutting back. But the S-class is also near the end of its life cycle. The "stripped cargo van" isn't so low end. The base model Sprinter has a higher MSRP than these vehicles: Acura TL Audi A4 Cadillac CTS Cadillac SRX Infiniti G25/G37 Lincoln MKZ Lexus IS And Mercedes is fine offering a commercial vehicle, they are a huge commercial vehicle producer. They still without the Sprinter outsell Lexus, Cadillac, Audi or Infiniti nearly 2-1. BMW is their only competition right now.

Mercedes outsold Lexus and Cadillac combined in June. I think the Sprinter sells better than most Lexus models, haha.

Thing is though, a CTS gets 27 mpg highway. A Genesis 8-speed gets 29 mpg highway, a 528i w/ 8-speed gets 32 mpg highway. This fall BMW is putting a turbo 4 in the 528i, that does 0-60 in 6.2 seconds and should get 35-36 mpg. But if 30-32 mpg becomes the norm for mid-size luxury sedans, how does the CTS find that extra 5 mpg without a new transmission? Then the other thing to consider is the influx of hybrids and diesels that is about to take place with luxury cars. Cadillac circa 2015 needs to have both.

I saw a new Optima turbo yesterday, it is nice looking car. It looks sleek and more expensive than it is. I also learned that you can get a double sunroof of Merc S-class style in it, that's pretty cool.