Cadillac Sales Plunge as Lincoln Gains

June 2, 2016 by Douglas A. McIntyre

General Motors Co. (NYSE: GM) continues to face the fact that its luxury car division is among the least successful brands in the industry, particularly because of the mighty effort from the largest vehicle manufacturer in America. (Johan de Nysschen, who has been CEO of Cadillac for less than two years, may be looking for a new job soon.)

Ford Motor Co.’s (NYSE: F) Lincoln sales continue to be tiny, but they have posted modest increases so far this year. If Lincoln sales continue higher and Cadillac stumbles, the unthinkable could happen. Lincoln could approach Cadillac in total sales for an entire calendar year.

Cadillac sales collapsed 16% in May to 12,099, an acceleration compared to the first five months’ drop of 12.5% to 58,968. Lincoln’s sales rose 6.9% last month to 9,807. For the first five months, sales rose 14.7% to 44,488.

The only Cadillac that sold well last month was the Escalade sport utility vehicle (SUV), which rose 14.8% to 1,856. After a tremendous marketing program, sales of the brand new CT6 hit 697, up from zero in the same month last year. The next few months will show whether the new flagship makes it. Sales of Cadillac’s primary coupes/sedans, the ATS and CTS, skidded. ATS sales declined 30.7% to 1,630. CTS sales fell 39.6% to 1,082

Lincoln’s results show how one vehicle’s success can carry an entire brand. Sales of Lincoln’s cars and SUVs suffered, with one exception. Sales of the relatively new MKX SUV rose 87.8% to 2,794. This represented 28% of the brand’s sales in May.

Cadillac is in trouble. Lincoln is inching forward. Neither is close to catching major foreign rivals BWM, Audi, Mercedes and Toyota Motor Corp.’s (NYSE: TM) Lexus. American luxury brands still have a long way to go, no matter how they are performing at the present.

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