Cadillac eyes China, Russia for growth

[NINETY EIGHT REGENCY]

Cadillac eyes China, Russia for growth

MARK PHELAN • DETROIT FREE PRESS • MARCH 15, 2010 • FROM LANSING STATE JOURNAL

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General Motors Co.'s Cadillac division made headlines recently with its plan for western European sales.

But the real news lies elsewhere: in China and Russia.

The rapidly growing markets already account for far more Cadillac sales than western Europe does and the brand is primed for more growth this year. Cadillac plans to eventually boost sales outside the United States to 30 percent of its total volume, double the current level.

Cadillac sold 128,727 vehicles around the world last year. That's about one-eighth the total for luxury car leader Mercedes-Benz. Cadillac has no aspirations to million-plus sales, but it must grow dramatically to compete with global powers such as Audi, BMW, Mercedes and Lexus.

Cadillac's model line and brand position make Russia and China the best candidates for growth over the next few years, global marketing director Jim Vurpillat said. The Mideast, where Cadillac has been strong for decades, is its other main market outside North America.

Sales in China and Russia are small now - 7,265 and 1,529 in 2009, respectively. However, each already exceeds western Europe, where German brands' large sales networks, model lineups and strong images give them a huge advantage. Cadillac sold 1,128 vehicles in western Europe last year. Its sales never approached the ambitious 20,000-a-year sales goal Dutch distributor Kroymans set when it became Cadillac's European distributor in 2003.

Cadillac's aspirations were crippled by a model line badly out of sync with European tastes. The lack of first-rate diesel engines effectively shut it out of half the market, while its SUVs left buyers cold.

None of that applies in China and Russia.

Neither country cares much about diesels, and both appreciate Cadillac's crossovers and SUVs. GM has handled Cadillac sales itself since launching the brand in China and Russia in 2004 and 2006, respectively.

"Chinese demand is off the charts" for the new SRX crossover, Vurpillat said. "It'll be 40 percent to 50 percent of our sales there this year" and dealers are howling for more, he said.

Chinese sales could almost double to 12,000 to 13,000 this year thanks to the SRX, he said.

China eclipsed Canada to become Cadillac's largest non-U.S. market last year, and Vurpillat said it shows no sign of slowing down. Cadillac has 40 Chinese dealerships and plans to add about 10, with more to come as the brand moves beyond megacities like Shanghai and Beijing.

The Escalade large SUV is Cadillac's best seller in Russia, where buyers appreciate its size and security. The smaller SRX is off to a strong start there, too.

"We expect Russian sales to be up by at least double-digit percentage points this year on the strength of the SRX," Vurpillat said.

Unlike the brash approach that previously failed in Europe, Cadillac now aims for gradual, consistent growth, Vurpillat said.

link:

http://www.lansingstatejournal.com/apps/pbcs.dll/article?AID=20103150318

[smk4565]

Cadillac doesn't even do well in the USA, and can't seem to grow any here, in fact they are shrinking fast in the U.S. Mercedes is looking to sell 100,000 vehicles in China this year, Cadillac's hope is 12-13,000? They are getting their butt kicked all over the globe. They can't compete with Mercedes when they have home field advantage, how will they ever do it on neutral ground or when Mercedes has home field.

[Z-06]

Cadillac doesn't even do well in the USA, and can't seem to grow any here, in fact they are shrinking fast in the U.S. Mercedes is looking to sell 100,000 vehicles in China this year, Cadillac's hope is 12-13,000? They are getting their butt kicked all over the globe. They can't compete with Mercedes when they have home field advantage, how will they ever do it on neutral ground or when Mercedes has home field.

You mean where Mercedes fleets taxis and limos?

[smk4565]

You mean where Mercedes fleets taxis and limos?

Cadillac fleets limos and hearses, so what.

Mercedes sells a million cars a year, Cadillac does not. Mercedes makes profit, Cadillac and the General do not.

Scoreboard.

[Lamar]

Fleeting and sales numbers argument aside, smk has a very good point.

Caddy should be fixed here, first and foremost, before expanding worldwide.

[balthazar]

Cadillac fleets limos and hearses, so what.

Cadillac has never manufactured or sold a hearse.

Cadillac has not manufactured or sold a limousine since 1984.

Next.