Jaws hit desks when Cadillac announced that the upcoming ELR would cost almost $76,000 but according to company representatives, dealers and industry analysts that’s not likely to matter.
The Chevrolet Volt on which it is based starts at about $35,000 and that’s after GM slashed $5,000 off the price for 2014. Early reviews of the vehicle are lukewarm at best and negative at worst to the premium Cadillac is prepared to charge. But a conversation between Ward’s Auto and Darin Gesse, the marketing product manager behind both vehicles is shedding a little light on the large price gap.
Gesse said the company believes the ELR is priced to be competitive within its class, but that raises questions about where the vehicle sits. Speaking to Ward’s, he said Cadillac expects customers to cross shop the ELR against the BMW 6 Series Gran Coupe and possible the brand’s new 4 Series. While the notion that a Volt-based luxury coupe with a 0-60 time laughably slower than either of those might seem strange, the premium price point could have its merits.
Cadillac ELR spokesman Brian Corbett echoed Gesse’s comments, saying the company pictures the car being cross-shopped against the Tesla Model S among others. Members of the automotive press haven’t been shy about taking Cadillac to the woodshed over its pricing strategy even before any dealers have taken delivery of the high-priced coupe, but early feedback from dealers could indicate that Caddy isn’t crazy after all…
“It’s amazed me. We’ve already sold orders,” Joel Defazio, general sales manager at Red Noland Cadillac in Colorado Springs, Colo. said during a phone interview. “That surprised me. I was a little skeptical.”
His store has already found buyers for its annual allotment. So far, four customers have committed to buying them; a small number, but one he says is appropriate for the market size because. “It’s going to be a very limited production car,” he said.
Production of the ELR starts this month, so Defazio hasn’t actually sold the ELR, but some of whom already own a Chevrolet Volt and see the ELR as an upgrade to an already familiar product.
Colorado is one of a few states with especially friendly tax policies toward vehicles like the Volt and ELR. Currently, the state government offers up to $6,000 in incentives for alternative fuel vehicles on top of the $7,500 Federal credit. Defazio ordered each of the ELRs he has sold specifically for the customers requesting them and he says some haven’t been worried about tax incentives, but they do all have one thing in common: they all want fully-loaded models.
It comes down to how this car is going to lease. — Dave Sullivan, AutoPacific
Corbett said during a phone interview that the ELR comes packaged with most of its content as standard equipment, but there are a few items missing. For example, adaptive cruise control costs almost $2,000 while upgraded leather rings in at $2,450 and optional red paint for about another grand. After adding the options, a fully-equipped ELR will cost just about $83,000 after delivery and excluding tax breaks.
To a certain extent, manufacturer-suggested retail prices don’t matter to customers, AutoPacific analyst Dave Sullivan said. “It comes down to how this car is going to lease,” he said, admitting that the price still came as a shock. “It is a bit of an eye-opener for me. I was blown away by the pricing, but to me it was saying ‘We don’t want people to buy this, we just want people to lease it.'”
Even with minimal sales, the ELR could be a big asset for Cadillac right now. The company is working to re-establish itself as a top-tier luxury brand, and part of that will fall to its image. The ELR could serve to draw buyers in to showrooms who might have otherwise ignored Cadillac on old notions of what the brand offers. And with years of Volt sale under its belt, Sullivan said Cadillac might be able to benefit from a relatively problem-free product launch.
GALLERY: 2014 Cadillac ELR live photos
GALLERY: 2014 Cadillac ELR
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