The BLS is far from a Yank tank
APRIL WILL BE the first full sales month for Cadillac in South Africa. General Motors SA sold more than 87 000 new vehicles last year, mostly Opels and Chevrolets, and Cadillac won’t add much in terms of volume. However, the return of America’s best-known luxury vehicle would be a big test of the ability of US automakers to take on the European players in the most competitive segment of them all – the compact executive.
Cadillac’s baseline model – the BLS – goes head to head with the BMW 3-Series and the Mercedes-Benz C-Class in SA. There can’t be many places outside Germany where both marques have a stronger hold on the segment. Even with the C-Class in its final months before the new model arrives, it sold just under 1 200 units in March. Usually during a so-called run out, sales drop dramatically as buyers hold out for the new vehicle, particularly at this luxury end of the market. March was also a disappointing month for passenger cars, with total sales declining just under 4% year-on-year.
The 3-Series ended 2006 in sixth place overall, with sales of 16 572 units in SA, one place above the C-Class. To put that in perspective, Cadillac expects to sell only 10 000 units across its entire range in the whole of Europe this year.
Cadillac premium channel manager Alf Bennett won’t disclose sales targets for SA but hopes to chip away at the established names with marketing centred on offering something different. That’s a shrewd strategy. In a market looking for exclusivity, the very success of the 3-Series and C-Class over many years is beginning to work against them.
The Cadillac BLS sold in SA is built in Sweden on a Saab platform, GM’s other luxury brand. Cadillac first launched the BLS in Europe a year ago and has not lost sight of European tastes, including a diesel model (only the second since the Seventies) in its line-up and for the first time in the company’s 104-year history, a station wagon (not available in SA).
Bennet says the introduction of the impressive Cadillac SRX sport utility vehicle (which is already available) was brought forward, and the BLS’s bigger brother – the STS – will be here by the third quarter.
Cadillac will be sold alongside Saab and Hummer in five new R10m dealerships, growing to 10 next year. Says Bennet: “SA is among the first markets where GM has grouped these brands together under one banner. This approach will be applied in other small and medium-sized markets around the globe.”
Last year 250 000 Cadillacs were sold worldwide, with its home market accounting for the vast majority.
GM SA must have watched Toyota’s reintroduction of its premium brand into SA closely. Last year roughly R200m was spent by Toyota on dedicated Lexus dealerships and service centres. For that, Toyota has reaped between 260 and 280 sales/month.
In contrast to Lexus, Cadillac enters the SA market at a time when the industry is hoping for a soft landing after three years of record growth. If Cadillac can match the performance of the Japanese brand from the start, it will have done well.