GM luxury brands Cadillac and Buick, are finding a place in some foreign markets; where they meet a growing demand for American style and convenience.
It’s no secret that the Chinese market has grown by leaps and bounds in the automotive industry. Along with this growth is the demand for high-quality American made vehicles. Buick has created a foothold in China and even offers one model in the lineup that’s built in China, but the story today has to do with the luxury brand that’s a sibling to Buick; Cadillac. The Cadillac brand has found an enormous demand for the models in this lineup in the Chinese market and these sales have helped to seriously boost the brand.
Over the past several months, Cadillac sales have dropped dramatically in the US. July alone showed a reduction of the sales of 22 percent to only 11,227 new vehicles sold in the US from this brand. This is the worst drop in the history of the brand since 2011, but the overall brand showed a different story. Cadillac actually had an increase in global sales of two percent thanks to the sales that took place in China. Over the past three years, this brand has steadily increased sales in China year over year and now sells a bulk of its production outside the US.
The sales in China for July increased by 37 percent to 12,006 vehicles which was the fourth consecutive month in which this brand was sold in a larger volume in China than it was in the US. The volume for the year shows the Cadillac brand up by 69 percent in China to 92,363 vehicles which is eleven percent more than what this brand has sold in the US. This certainly represents an amazing shift in the marketplace for the Cadillac brand and one that appears to be poised to sustain the brand for the long term.
Not only has Cadillac found more sales in China, the production of vehicles in China for the brand has increased dramatically as well. Last year the Chinese production only represented 35 percent of the global volume; for 2017 that number has increased to 49 percent. It seems that Cadillac is finding more success outside the US even though this has historically been a domestic brand that has shown quality and growth in the US in a variety of ways. There may be a change on the horizon that will turn the sales in the US to the positive for this brand.
If you look at what Cadillac offers and what the market demands, this brand is missing their share of the SUV market. Currently, there are only two SUV models from this brand, the XT5, and the Escalade. Plans are in place to build two new XT models, one to fit below the XT5 and one to fit above it. With these additional SUVs, which will be built in the Fairfax, KS plant, the sales for Cadillac should turn around in the US and begin to grow. More SUVs are sold in the current US market than any other style of vehicle and with these additions, Cadillac can be more competitive and capture their share of what’s been missing.