Is a $300000 Cadillac a Mistake?
Cadillac unveiled a concept version of the CELESTIQ ultra-lux sedan last week. Rumors of pricing for the production model have been swirling with some estimates around $300,000.
So, this begs the question…has Cadillac lost their collective minds? Will anyone walk into a showroom and drive off in a $300k Cadillac sedan?
The answer is ‘no’ - but not for the reason you might be thinking.
This is not going to be a car built like your garden variety CT5 or Escalade. The CELESTIQ is going to be hand built to a buyers specification. This makes the CELESTIQ that much more like a Rolls-Royce or an Aston Martin.
If you come to Rolls-Royce, you can select from a traditional list of options and colors…but if you take part in their Bespoke Program, a truly epic number of options are at your disposal with thousands of colors and the option to work with the interior designers to select from defined color schemes or have something truly unique developed and installed for your car.
I think we should expect practically every CELESTIQ to be built after a buyer spends time with a specialist and selects from a laundry list of customization options. This is a car that likely will be available in far more colors and patterns, inside and out, than any Cadillac you have seen before. They may also offer options for truly bespoke paint and interior options like ultra luxury brands offer.
Want your seats done with bright purple, faux ostrich leather? They might try to make that happen. Want your paint to match the scarf of your teddybear growing up - bring in a sample so they can work on that for you. This is how you make a ultra-luxury sedan for buyers with the means to expect their car to be something the feels like it is really -theirs-.
One thing I think we can be sure of is that Cadillac will build very few of the CELESTIQ for dealer stock. They might build examples to have on hand in major markets to help inspire potential customers. These would be a good way to start the conversation with those potential buyers who need to sit in a car before moving forward with the customization conversation…but I think Cadillac intends for most of these cars to be built to-order.
In that spirit, if only 300 buyers come forward a year to get a CELESTIQ…then that is what they will build. They won’t be a failure at that sales rate because they were intended to change the image of the brand. The car is supposed to send a message about what Cadillac and GM as a company are capable of. They aren’t supposed to meaningfully change Cadillac’s profits.
They also are a way to show how the new Ultium platform strategy can allow GM as a company to offer really unique products to all different kinds of customers. Ultium is a collection of technologies that allows GM to build products as different as the GMC Hummer pickup -and- the CELESTIQ and to showcase how technology and electric powertrains will transform transportation -and- GM as a company. Every CELESTIQ sold will be incremental volume for GM towards that goal. Therefore, it shouldn’t be judged by traditional sales volumes like other Cadillacs.
In that way, don't expect Cadillac to chase sales volume. Don’t look for them to lower the price in a year or put cash on the hood. Your local dealer won’t be running specials to come in and pick your color of CELESTIQ from what they have in stock.
So, is Cadillac crazy to ask $300,000 for their flagship sedan? Not necessarily. Will everyone writing articles or commenting on blog posts or Facebook understand that - certainly not.
But at least you can sit back and watch while we see if this strategy works or if we will be talking about the CELESTIQ in a decade like people do now about the Caterra or the Cimmaron as a time when Cadillac took a chance that didn’t pan out.