SALES TALES: Cadillac keeps 'true luxury' title

[tgagneguam]

SALES TALES: Cadillac keeps 'true luxury' title

By John K. Teahen Jr.
Automotive News / February 14, 2005

John K. Teahen Jr. is the senior editor of Auomotive News.

True luxury
2004 U.S. sales of cars and light trucks over $42,000 by major brand in luxury segment Sales over $42,000* Percent of total sales

The best ...
Cadillac 182,727 78
Mercedes-Benz 156,466 70.7
Lexus 152,223 52.9
Lincoln 133,603 96.1
BMW 129,895 49.9

... and the rest
Acura 56,535 28.4
Infiniti 32,690 25
Porsche 31,473 100
Audi 29,725 38.2
Hummer 29,345 100
Land Rover 25,497 71.8
Volvo 24,962 17.9
Jaguar 24,333 53
Saab 6,352 16.7

Once again, it's time to make one U.S. luxury brand happy and several others mad.

It's the annual Automotive News rundown on which major brand sells the most "true" luxury cars and light trucks - those with a sticker price of $42,000 or more, including options.

In this case, Cadillac will be pleased; others won't be.

The $42,000 comes from the U.S. government's late and unlamented luxury tax, which kicked in at a transaction price of $40,000. The tax died at the beginning of 2002. Car and truck prices have continued to rise, so Automotive News now uses a benchmark of $42,000.

In 2004, Cadillac was the winner for the third year in a row, and it increased its margin considerably last year. In 2003, Cadillac topped Mercedes-Benz by 933 true luxury U.S. sales. In 2004, Cadillac's margin was 26,261. Mercedes was second again.

Cadillac chalked up 182,727 true luxury sales last year, and Mercedes had 156,466. Lexus was next in line with 152,223 followed by Lincoln (133,603) and BMW (129,895).

Only one other brand in the luxury segment had more than 35,000 true luxury sales. That was Acura, with 56,535. Most of those were loaded MDX sport wagons.

That order of finish differed from the ranking in the overall luxury segment. The 2004 leaders in that segment were, in order, Lexus, BMW, Cadillac, Mercedes, Acura and Lincoln.

If you're confused, you have a right to be. But the answer is simple.

Every major luxury brand except Porsche and Hummer sells cars and trucks that do not qualify as true luxury under the Automotive News standard of a sticker price of $42,000. They are counted in their make's overall tally, but not in this one. They include, for example, the Cadillac CTS, Mercedes C class, BMW 3 series, Lexus G 35 sedan and many Lexus RX 330 sport wagons and some Lincoln LS models.

Looking at percentage of sales represented by true luxury deliveries, Porsche and Hummer are 100 percent over $42,000. Lincoln has 96.1 percent of its sales in that class, and Cadillac has 78.0 percent (see box below).

I like this version of the luxury vehicle sales race

[dav305z]

Well, nice to see that they are gaining ground in this extremely profitable segment. And to think, most of those $42k+ sales were Escalades that cost GM very little to build. I can only expect that with the new STS and DTS that these sales will increase. As for overall sales, It's nice to see that Caddy is third. When you consider that both Lexus and BMW offer models below the price and size level of the CTS, third is pretty good. The BLS could certainly change this, but I'm not totally certain they want to. Unlike Lexus and BMW, Cadillac has several brands that slot right below it. I wouldn't mind seeing Buick, Saab, Saturn and Pontiac taking some of those entry lux sales away from Lexus and BMW rather than Cadillac.

[Darc Requiem]

Its nice to see that the are increasing their lead over Mercedes. I also like the fact that 78% of their sales are from the 42k and above segment. It means people are willing to pay 42k+ for the Cadillac name. The only thing Caddy has below 42k is the CTS. So would that would mean the left over 22% would me the CTS sales....right?

[slaughter58]

Now this looks like an American Revolution to me. Snowball affect is taking place here. If caddy keeps their models fresh, and the new product trickling in they are gonna spank the imports. I think with caddy marketing the v-series as they have been only good things can happen, people will buy based on quality, new product, and the perfomance luxury image that is being built.

[AdmiralViscen]

Why does Ford think that Lincoln isn't viable as a true luxury marque? People are obviously still willing ot pay big bucks for them.

[jro4566]

Must be the Escalade...

[member12]

Originally Posted by AdmiralViscen

Why does Ford think that Lincoln isn't viable as a true luxury marque? People are obviously still willing ot pay big bucks for them.

Yeah, the late sixties continental is probably my favorite car. Black sedan with suicide doors. My grandfather had one.

I wish Lincoln would do something like Cadillac, perhaps making the two bestselling Luxury nameplates American nameplates. Lincoln derserves more attention than what Ford is willing to provide.

[Bravada]

The truth is that these numbers prove that Lincolns sell well (and for good prices) WITHOUT Ford doing anything about them. So the economic reasoning for Ford is not to spend money on Lincoln now. Jag is the one who needs investment, especially given those figures.

I also hope Ford gets back to Lincoln and revives it as a true (and global) luxury brand, but I hope not the Caddy way (i.e. heritage styling and real NAMES for models and no A&S crap).

[SobeSVT]

Very interesting ranking. Amazing performance by Cadillac, is good to see the results of honest effort and hard work. Cadillac is certainly showing Detroit how is done. Beautiful numbers!!

Interesting also that John K. Teahen drives a 2005 Lincoln LS. He traded in his old 2002 Lincoln LS.

[MelvinJ]

I'd like to see the stats for any nameplate that sells vehicles over $42K, instead of just "luxury" nameplates. I'm almost certain the top seller of vehicles $42K and over would be Chevrolet, thanks to Suburbans, Tahoes, and the very high end (mostly diesel) Silverados. Corvettes add a few in there too.

Interesting that the lowest brand in the GM lineup would sell the most vehicles over $42K.

[goblue]

Originally Posted by Bravada

The truth is that these numbers prove that Lincolns sell well (and for good prices) WITHOUT Ford doing anything about them. So the economic reasoning for Ford is not to spend money on Lincoln now. Jag is the one who needs investment, especially given those figures.

Actually, I would do the opposite - invest heavily in Lincoln and cut back the Jag models to a lower end (40K) sedan / coupe / convertible - all on the same platform, a high end sedan (60K) , and thats it. Then, as Jag reclaims profitablilty - consider adding models. Lincoln needs a massive cash infusion and design project - something along the old school american luxury line. Clean conservative lines, large RWD vehicles, and conservative large SUVs. Contrast it to Caddy and they could do quite well. Where lincoln is going wrong is trying to dabble in smaller luxury cars - let Volvo do that, and make it a hip brand. The old school conservative, Lincoln heritage simply doesn't do well in smaller lux vehicles. The CTS works b/c A&S appeals to 30 year olds much better than 70 year olds, and younger people tend to desire smaller, sportier cars.

[Bravada]

You mean you would drop the XK? I guess it defines the brand, it has to stay.

May I return to my idea of pairing Lincoln and Jaguar - Jag does sporty European cars, Lincoln does classic American luxury barges, both RWD. XJ's platform is used as a base for the new Continental, available as a Town Car Sedan and Mark IX cabriocoupe. Plus a "smaller Lincoln" on the S-Type platform (that's basically what LS is). Mercury takes care of the Zephyr market.

[SobeSVT]

Originally Posted by Bravada

You mean you would drop the XK? I guess it defines the brand, it has to stay.

May I return to my idea of pairing Lincoln and Jaguar - Jag does sporty European cars, Lincoln does classic American luxury barges, both RWD. XJ's platform is used as a base for the new Continental, available as a Town Car Sedan and Mark IX cabriocoupe. Plus a "smaller Lincoln" on the S-Type platform (that's basically what LS is). Mercury takes care of the Zephyr market.

That was Wolfgang Reitzle original plan. Was ruled out as too costly. It only makes sense to me.

[mk1700]

Yes! at least one american brand on the first place!
Good Work Cadillac!

[mikethenerd]

Originally Posted by goblue

Lincoln needs a massive cash infusion and design project - something along the old school american luxury line. Clean conservative lines, large RWD vehicles, and conservative large SUVs. Contrast it to Caddy and they could do quite well. Where lincoln is going wrong is trying to dabble in smaller luxury cars - let Volvo do that, and make it a hip brand. The old school conservative, Lincoln heritage simply doesn't do well in smaller lux vehicles. The CTS works b/c A&S appeals to 30 year olds much better than 70 year olds, and younger people tend to desire smaller, sportier cars.

Good point. People still buy the town car because it is big, RWD, and rides great. I think Lincoln could use a CTS fighter though (An updated LS). I read somewhere (probably on this site) that the next generation town car and LS would be FWD and built of the same platform of the Ford 500. Can anbody verify that? If so, that is a big mistake. Why can't Ford develop a RWD/AWD platform for Lincoln, like GM did for cadillac with the Sigma platform? I think Ford has fell off the deep end.