General Motors is sticking to pricing strategy for Cadillac ELR

Article by Anita Panait, on August 29, 2013

Despite a decision of many carmakers to trim the sticker price of their electrified vehicle offerings, General Motors remains bullish of the pricing for its Cadillac ELR plug-in hybrid. When GM unveiled the ELR in January, it executives said they plan to fix a lofty sticker price to convey exclusivity. But GM and its rivals has been cutting prices of their own EVs.

For instance, GM trimmed $5,000 off the sticker price of the Chevrolet Volt, which shares its powertrain with the ELR. Also, the BMW priced its new i3 EV at $42,275 including shipping, which is only $2,280 pricier that the previous tag for the Volt. Despite the recent occurrences, Bob Ferguson, senior vice president of global Cadillac told Automotive News that that they have not revised their pricing plans for the ELR plug-in hybrid, which will be rolled out in March 2014. Ferguson said that they are "really confident about that vehicle," adding that there will be "a scramble" for the ELR.

Ferguson remarked that was encouraged by the success Tesla Motors, a sign that pricing is holding up far better in the luxury segment than in mainstream brands. IHS Automotive expects GM to sell just 2,100 ELRs in the US in 2014 and 2,700 in 2015. According to Jim Hall, principal of research firm 2953 Analytics Inc., the ELR will be a halo car for Cadillac, while the i3 has a different role in BMW's lineup. He noted that Cadillac's pricing strategy for the ELR is not driven by volume, but by image.

He said that the ELR could be among Cadillac's highest-priced vehicles. Escalade models and the CTS V series are priced from the mid-$60,000s to higher than $70,000.The ELR uses the Volt's underpinnings but has edgier styling and extra touches, such as real wood accents, a suede headliner and a storage compartment accessed through an electronic cover.

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