Detroit Auto Show: Cadillac Unveils New SUV

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DETROIT January 5, 2003; Michael Ellis writing for Reuters reported that General Motors Cadillac division on Sunday officially unveiled its SRX mid-size sport utility vehicle at the Detroit auto show on Sunday, one of three completely new vehicles the luxury brand will roll out this year.

The SRX arrives a year after Cadillac began its product renaissance with its new sharp-edged styling, embodied by the CTS sedan, which has lifted the automaker's sales this year and boosted its appeal among younger buyers.

Cadillac's U.S. sales last year grew 16.1 percent, to 199,728 vehicles, good for fourth spot among luxury brands behind the No. 1 seller Lexus, the Toyota Motor Corp. (Tokyo:7203.T - News) brand.

Cadillac had been the best-selling luxury vehicle nameplate in the United States for nearly 50 years until it lost the sales crown in 1998. But Cadillacs lost their appeal to a whole new generation of buyers who preferred the smaller, sportier cars offered by the European and Japanese automakers.

"The CTS has worked to change the perception of the brand," said Jeff Schuster, director of North American forecasting with J.D. Power and Associates. "The new styling is a little bit of a love-it-or-hate-it thing, but I think people are coming around to it."

Cadillac took another step this year to change its elderly image by licensing the Led Zeppelin's 1971 hit song "Rock and Roll" for use in television advertisements.

Cadillac General Manager Mark LaNeve said it will be difficult to achieve last year's sales gains, particularly with most forecasters predicting a moderate drop in industry-wide U.S. sales this year. But its new vehicles should help, he said.

"We certainly hope that we can continue to grow in a stable market," he told reporters before the auto show.

The SRX will be a late addition to the growing number of luxury mid-size SUVs, which include Toyota Motor Corp.'s popular Lexus RX 300, BMW AG's X5 and the Mercedes M-Class from DaimlerChrysler AG, Nevertheless, analysts said that the SRX could be a big success.

"That, I think, is going to be a smash hit," said Scott Hill, an analyst with Sanford C. Bernstein.

Mid-size SUVs, many of which now have third row seats, are proving to be a popular alternative to mid-size and large cars, and minivans.

The SRX, which will go into production this summer, is one of three all-new Cadillacs coming this year. Also arriving is year is Escalade ESV, a full-size, seven-passenger SUV somewhat similar to the Chevrolet Suburban, and the XLR roadster.

"I think the product base that they're putting out there is truly impressive ... Their big burden is to try to overcome perceptive issues that have haunted this company for the last 25 years, and rightfully so."

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