Cadillac Increases Its Presence In China

BEIJING  (WWJ) – General Motors is going to build more Cadillacs in China.

With the Beijing Auto Show as a backdrop, GM announced Monday that it’s going to produce a version of the Cadillac XTS in China for sale in that market.

“It illustrates how important the Chinese market has become for Cadillac,” said GM Marketing Vice President Don Butler. “Last year our sales rose more than 70 percent. Introducing the XTS is part of our strategy of adding at least one new model a year to the Cadillac lineup in China at least through 2016.”

INTERVIEW: Don Butler, Cadillac Vice President of Marketing

While the entire product plan hasn’t been laid out, Butler also said they will sell the extended range electric Cadillac ELR in China. The ELR, which will be out in 2015, will have a power train similar to the Chevy Volt.

Cadillac currently imports the Escalade and CTS to China, and makes a sedan that’s unique to the China market. While Cadillac sales have been growing in China, the total number remains fairly small. Cadillac sold 30,000 vehicles in China last year.

Butler says the drive to increase Cadillac’s presence will not hurt Buick, which is now General Motors most popular brand in China.

“Buick is one type of luxury,” said Butler. “Cadillac is a distinct type of luxury. From a price position standpoint, from the kinds of buyers that we’re targeting, we feel very, very comfortable with how Cadillac will be viewed, and how it is viewed in China.”

GM sees the Cadillac XTS competing with European luxury sedans in China.

China is now the world’s largest car market. While growth has slowed some this year, it’s seen as a market with enormous potential. Analysts believe sales in China could top thirty million a year by 2020.

Because of import duties, it’s expensive to sell vehicles in China that were built elsewhere. But, GM says it also needs more capacity for the XTS, which is built in Canada for the North American market.

Even the XTS production in China, Butler says, will have a positive impact on GM’s operations in the U.S.

“Although the vehicle is built in China, and the laborers there assembling the vehicle will obviously be Chinese, the fact that it was designed and developed here in America, the supply base, again is a global supply base, but a lot of those located here in North America.”

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