Forget the halos, focus on the core

An article in this week’s Automotive News has people wondering again about Cadillac’s ongoing flirtation with the idea of producing a $100,000+ car. They’ve shown two in recent years, the Cien mid-engined supercar and the Sixteen sedan. Fans of GM love the cars. I also happen to be a fan of GM, but I feel that producing either car would be a mistake.

Cadillac Cien conceptCars such as the Sixteen never sell in high volumes, and those like the Cien have even fewer customers, so there is little if any potential for direct profit from them. Instead, they are generally justified as “halos,” high-end cars that will bring people into showrooms to take a look and supposedly improve the overall image of the brand. The idea is that people will come to the showroom to check out the Ford GT or Dodge Viper and leave with a new Taurus or Stratus.

Perhaps this happened in decades past, when the only cars available were limited production sports cars and mainstream sedans and wagons. But these days few if any people are going to buy a generic sedan to get a piece of the image of the dream car they’ll never actually own. Instead, with so much diversity in today’s market, people can buy a car that fairly well satisfies their full range of needs directly. Why buy a sedan that sits in the same showroom as a sports car, when you can buy a sports sedan?

For a halo to have any impact, it must be closely related to the brand’s other cars. A sports car has a much better shot of boosting the sales of a first-tier sports sedan than it does of boosting the sales of a fleet special. In other words, a halo cannot substitute for shortcomings in the core products. The top priority must be on making the core products as strong as possible.

Cadillac STSWhich brings me back to Cadillac. Before Cadillac can play in the $100k+ class, it needs a more solid position in the $50k to $70k stratum. The current STS sedan and SRX crossover have fallen well short of their sales goals. The SRX has won a number of comparison tests, but clearly it’s not what premium crossover buyers are looking for. The STS has simply underwhelmed. This is where Cadillac’s focus for the next five to ten years needs to be, not on some ego-gratifying halo.