General Motors and China have been close friends for years thanks to the popularity of its Buick brand, but the General is reportedly working on making Cadillac a fixture as well, by producing three models there.
The Detroit News reports that Cadillac will announce these intentions at the Beijing Auto Show later this month. Ultimately, Cadillac will build its ATS sport sedan, midsize CTS sedan, and executive XTS sedan in China. Presently, only one Cadillac model is currently built in China, the STS-based SLS executive sedan. It's built by Shanghai General Motors, which is a long-standing joint venture between General Motors and SAIC Motor Corp.
Because the SLS is made in China, it isn't subject to the heavy tariffs levied on imported cars by the Chinese government. This makes for some serious price discrepancies in Chinese-market Cadillacs: A top of the line 2012 Cadillac CTS will cost you $57,555, but Chinese-market models cost $71,032 after including import taxes and fees. CTS buyers in China actually pay more for the sport sedan than the larger, Chinese-built SLS, which starts at just $61,546.
At this stage, it’s unknown if the CTS and ATS will be clones of their North American counterparts, or if Cadillac is planning on crafting long-wheelbase variants to appease Chinese buyers, who frequently prefer being driven in their luxury vehicles instead of actually driving them.
Cadillac sales hit 30,000 last year in China, which is a 72.8-percent increase from the year before. Moving production of Chinese-spec ATS, CTS, and XTS sedans to that market could greatly increase Cadillac's market share in China, considering that Chinese luxury car buyers are scooping up BMW 3 Series and Audi A6 models. As for whether or not Cadillac will cannibalize Buick, it's rather unlikely: the venerable luxury brand sold nearly 650,000 vehicles last year in China.
GM believes that China will consume half of the world's luxury goods by 2020, so perhaps Cadillac's preparations are arriving just in the nick of time.
Source: Detroit News