As Foreign Cars Dominate Luxury Market, Cadillac Pushed Down List

Cadillac Logo
Cadillac Logo

Despite the launch of a number of new models, Cadillac's share of luxury car sales in the United States continues to be less than modest, as the sales of brands from overseas have pushed it almost out of the market. General Motors Co. (NYSE: GM) remains at a loss about how to break back into a market that it once dominated.

Among luxury brands, Cadillac had a market share of only 9.2% over the first eleven months of the year, according to Edmunds. That puts it far behind Mercedes and BMW, with 17.3% and 17.1% respectively.

With 15% of the market, Toyota Motor Corp. (NYSE: TM) nameplate Lexus sits well ahead of Cadillac. Honda Motor Co. Ltd.'s (NYSE: HMC) Acura has a share of 9.8%. Audi almost matches Cadillac's position with an 8.7% share. Just behind is Nissan's Infiniti nameplate with 7.5%.

Cadillac's major gamble for an improvement in sales is the launch of two new models. These are the large XTS, with a base price of $44,075, and the smaller ATS, with a base price of $33,095.

There is no reason to believe that the XTS can match the reputation of the Audi A6, the Mercedes E-Class or BMW 5-Series or 7-Series vehicles. Each of these is considered a marvel of engineering. Each is available with all-wheel drive, as is the Cadillac.

The ATS is meant to compete with the BMW 3-Series, which many experts believe is the best car in the world, and also with the popular Mercedes C-Series and Audi A4. Again, each can be bought with all-wheel drive, as can the Cadillac.

The A6 and BWM 3-Series were each on the Car & Driver 10 Best list. The Audi A7 captured the Consumer Reports "reliability" rating for "upscale/luxury" cars. In the J.D. Power Initial Quality Survey, the luxury premium crown went to the Lexus LS and the mid-sized premium to the Infiniti M-Series. In the Power Vehicle Dependability Survey, the luxury-class winners were Hyundai, Mercedes and Volvo

Until the luxury car buyer's perception of Cadillac changes, it will remain an also-ran in the category.

Douglas A. McIntyre

Filed under: 24/7 Wall St. Wire, Autos Tagged: featured, GM, HMC, TM