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.

By having a profile that leans more forward and aggressive, the Cadillac ELR is able to present a progressive and new theme, as well as proportion, to the design evolution of the brand. In fact, it is able to carry, without any changes, the 2009 Converj Concept that served as its inspiration. Looking at the overall shape of the ELR, it is clear that it is reinforced by the sweeping and pronounced body line.

This body line in turn is highlighted by the 20-inch wheels, all of which have been positioned to the edges of the vehicle’s body. In designing the ELR, the brand made sure to put emphasis on aerodynamics. The goal was to manage the airflow so that the drag experienced by the vehicle would be minimized. Making this possible is a combination of the narrowed fascia corners, flush front fascia, and the grille having active shutters at the back of its opening.

As such, the air moves easily around the ELR and this lowers the drag. On the rear section, the sharp edges plus the spoiler assist in managing the airflow. Still on the rear section, the back glass and the windshield with its aggressive rake help as well in lowering both the drag and the turbulence.

All of these different measures help in giving the new ELR a coefficient of drag at 0.305. In terms of design, the use of vertical elements for the headlamp and the tail lamp results in the ELR showing off Cadillac's signature, whether from the rear or front, or even during daytime or nighttime. Then again, this has been a tradition the brand has followed going back to 1948.

Cadillac Design Director Mark Adams said that the Cadillac’s guiding principle of Art & Science is still in the new ELR but it is characterized in a new dimension. The brand, he added, has always been known for innovation as well as having a design that is provocative and dramatic. The ELR manages to offer this as a luxury coupe and thus, it stands out among the world’s major luxury brands, he continued.

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