Ford shouts that its ambition is to dethrone Tesla from its position as world leader in electric vehicles.
Chief Executive Jim Farley is never shy about taunting Tesla CEO Elon Musk on social media. It’s something of a game between the two bosses.
Last year, Tesla (TSLA) – Get Free Report was by far the leading seller of electric vehicles in the U.S., followed by Ford (F) – Get Free Report. The American electric-car landscape seems as if it’s Tesla, Ford and the rest.
And yet — a third actor continues to quietly align his pawns.
What we see less prominently is that the Detroit giant is transforming Cadillac, its premium brand, into a real machine to challenge Tesla’s leadership in EVs.
GM Announces the Escalade IQ
GM, for example, has just said that later this year Cadillac would launch an electric version of the iconic full-size Cadillac Escalade SUV.
The new model, the Cadillac Escalade IQ, “promises the same commitment to craftsmanship, technology and performance that has helped the Escalade nameplate dominate the large luxury SUV segment for the last 20 years,” the company said in a statement on May 22.
The carmaker did not provide further details about the vehicle: nothing, for example, about range or selling price.
“The IQ naming strategy celebrates Cadillac introducing a different type of EV to the market — one that works in tandem with people’s daily lives and environments,” the Detroit giant said.
Going by Cadillac’s history in electric vehicles, we shouldn’t expect the Escalade IQ to be just an electric version of the internal-combustion-engine-powered Escalade.
Indeed, GM’s previous electric models that share names with their gasoline models have completely different designs, technologies and features. In addition, the Cadillac Escalade IQ will be developed on GM’s Ultium modular platform for EVs.
“As the brand’s first all-electric full-size SUV, Escalade IQ marks the reinvention of one of Cadillac’s most iconic nameplates,” a spokesperson said in an emailed statement.
Analysts expect GM to start producing the Escalade IQ no later than early 2024 followed by customer deliveries. This vehicle confirms GM’s strategy to make Cadillac a brand producing and selling mainly electric vehicles by 2030.
Cadillac Going Full Electric
Cadillac has already announced two electric vehicles: the Cadillac Lyriq SUV, base-priced at $58,590; and, last year, the Cadillac Celestiq, which the company said was designed to reconnect Cadillac with its famous motto: “the standard of the world.”
The Celestiq is an imposing luxury electric sedan that will be brought to the market by 2024. Celestiq’s designers have traveled back in time to study prewar V-16s and the 1957 Eldorado Brougham to draw inspiration.
Fewer than 400 Eldorado Broughams were built, for a starting price of $13,074 each. At the time, a Rolls-Royce Silver Wraith sold for $9,000. Adjusted for inflation, those figures would be roughly 10 times as much today.
Production, which will be based on GM’s Ultium modular platform for EVs, is expected to begin in late 2023. The Celestiq will be a niche and exclusive product, with a base price around $300,000 or more.
GM is betting big on Cadillac. Last November, the carmaker said its electric division would be profitable in 2025 in North America. In other words, in two years, its electric vehicles will start contributing to the company’s bottom line like gasoline vehicles.
It plans to ramp up EV capacity in the region to more than 1 million units annually, increase its software revenue opportunities, generate significant greenhouse gas benefits and realize the positive impacts of new clean energy tax credits.
The vow left many investors speechless, since they didn’t expect the billions of dollars of investment automakers are pouring into electric vehicle development to pay off before the end of the decade.
But CEO Mary Barra said new elements had emerged. She listed federal incentives under the Biden administration’s Inflation Reduction Act, which includes money back for companies that produce EVs in North America as well as for consumers and fleet customers who purchase the vehicles.
Sales of electric vehicles are expected to reach 50 million in 2025, said GM, which plans to produce 400,000 vehicles a year in North America from this year through the first half of 2024. Annual output is expected to reach 1 million units by 2025.
The Detroit giant thus hopes to boost its market share.
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