Cadillac to spend $12 billion on 8 new vehicles by 2020

Melissa Burden
The Detroit News

Detroit — General Motors Co.'s Cadillac brand will invest $12 billion in eight all-new vehicles, including SUVs, by the end of this decade, Cadillac President Johan de Nysschen said Tuesday at the North American International Auto Show.

Of those vehicles, five will be in segments that the brand doesn't compete in today, de Nysschen said. Cadillac likely will add a small crossover and a sedan smaller than the ATS in two years, and a car bigger than the CT6 by 2020, he said.

Three of the vehicles will be crossovers, two positioned smaller than the SRX crossover like the size of the BMW X1 and Audi Q5, de Nysschen said.

"Then there's a big gap above SRX and below Escalade," he said. "And so I think when we have all those in place we will have a very comprehensive crossover/SUV portfolio."

The investment is substantial for the Cadillac brand, analysts say.

Cadillac on Tuesday revealed the 2016 CTS-V, a powerful sedan packing 640 horsepower and capable of hitting 200 miles per hour. The most powerful Cadillac in the brand's 112-year history will be available in the summer.

During a fall Barclays Global Automotive Conference, de Nysschen said he wanted the luxury brand to sell an "ambitious" half million vehicles a year globally by 2020. That's up from 263,697 vehicles it sold last year. Its global sales rose 5 percent, but U.S. sales slid 6.5 percent in 2014.

"We are on a mission to turn Cadillac back into being a powerhouse global luxury brand," he said. "Our focus is on elevating the brand stature. It is not to sell cars."

Cadillac could choose to put big incentives on vehicles to sell more cars, but the brand wants to earn its growth through products, de Nysschen said. It also wants to retain its high average transaction prices that top competitors.

But he acknowledged the lack of a premium luxury sedan below the ATS and a crossover below the SRX are "clearly limiting our growth opportunities at present in the U.S. market."

Much of its growth is slated for China, where Cadillac sold more than 73,000 vehicles in 2014, up 47 percent from 2013. But de Nysschen told reporters that he expects sales of luxury vehicles in China will slow this year and predicts Cadillac will sell about 80,000 vehicles there in 2015.

A slide in the Barclays presentation on future Cadillacs shows 12 offerings, up from the six in the lineup today. That included a small luxury car, a convertible, a compact and mid-luxury car, a large luxury car, two other compact/mid luxury cars, a small luxury SUV, a compact luxury SUV and two midsize luxury SUVs, plus the Escalade.

Today's lineup includes six vehicles: the compact ATS and ELR plug-in hybrid, midsize CTS and XTS, and a midsize SRX SUV and the Escalade.

GM will work to boost production of the popular selling Escalade this year by about 2,000 vehicles at its Arlington Assembly Plant in Texas, de Nysschen said. Increasing Escalade production won't diminish production of the other large SUVs built at the plant, said Mark Reuss, GM's head of global product development, purchasing and supply chain.

(313) 222-2319