GM, Ford show new luxury models

August 17, 2002

PEBBLE BEACH, Calif. Bloomberg News -- General Motors Corp.'s Cadillac and Ford Motor Co.'s Jaguar introduced cars on Friday intended to regain customers who have shunned the world's two largest automakers in favor of German and Japanese rivals.

Cadillac will add a V-Series auto line next year based on current models that feature more engine power, racing-style suspension, wheels and brakes, said Mark LaNeve, the unit's general manager, at the Concours d'Elegance motor show in Pebble Beach.

The company also showed its XLR, a 4.6-liter, V8 engine convertible with a retractable hardtop that is to go on sale next year priced at more than $80,000.

Jaguar showed the 2003 XKR sports car that is to go on sale Oct. 1 with a 390-horsepower, V-8 engine, about 5 percent more power than the current model, said Bob Dover, chief operating officer of Ford's Aston Martin Jaguar Land Rover unit. Prices for coupe and convertible models are unchanged at $81,975 and $86,975.

General Motors and Ford have poured millions of dollars into reviving their luxury units' prestige to lift profit.

While Cadillac and Jaguar increased sales this year through July with respective gains of 13 percent and 63 percent, they lag Bayerische Motoren Werke AG's BMW, Toyota Motor Corp.'s Lexus and DaimlerChrysler AG's Mercedes-Benz in total U.S. sales.

Cadillac "is doing many things right with new products but they've got a lot of hurdles to overcome," said Wes Brown, an analyst with Nextrend, which tracks consumer buying patterns.

"They've got interesting things coming but so do BMW, Lexus and Mercedes."

The brand's new performance line won't generate a lot of new sales, Brown said.

Still, "there's a growing segment within the market that wants vehicles with extra performance, and it's a smart move to appeal to this kind of enthusiast buyer," he said.

Jaguar's latest XKR is also meant to improve the brand's reputation, though it probably won't result in much greater numbers than the current model, Dover said.

Sales of XK-series sports cars fell 32 percent in the year's first seven months to 2,254.

"This is a relatively low volume car," Dover said in an interview, declining to set a sales target.

"We're in the premium business. We want to supply people but we don't want to push metal down people's throats."