Cadillac's Resurgence Critical to Chevrolet Silverado's Future

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By Tim Esterdahl

Cadillac's new brand chief recently laid out the future of the brand and explained why GM is willing to invest in rebuilding it. According to a Motley Fool report, GM is spending money on Cadillac to help GM trucks. What the heck does Cadillac have to do with GM trucks? Simple. Profits, lots and lots of luxury-car profits offsetting future truck margins.

It is no secret that corporate average fuel economy requirements for pickup trucks will cause manufacturers to use all sorts of fuel-efficiency tricks. Terms like turbocharging, hybrids, diesel, aluminum and high-strength steel for reducing weighting will become part of "truck-guy speak" in the foreseeable future.

All of these fuel-economy innovations have one big problem: They make trucks more expensive to build, and truckmakers have been reluctant to pass those costs onto customers. Instead, Ford and other manufacturers have added features and options to entice customers to spend more on pickup trucks. Also, there are more luxury pickups to choose from. This isn't by accident; truckmakers are looking for ways to keep healthy profit margins and offset the higher production costs. Luxury vehicles help them accomplish that.

Cadillac to the Rescue

Getting back to Cadillac, GM is quite serious about making the luxury brand relevant again, and the reason is profits.

"The global luxury market accounts for, depending on how you define the luxury market, 10% to 12% of the total auto business globally, but generates about half the profit," said Cadillac President Johan de Nysschen in the Motley Fool article.

Another example of a luxury brand's importance is demonstrated by Volkswagen Group. Porsche and Audi, two luxury brands owned by VW, accounted for just 18 percent of the group's total sales. However, they contributed 65 percent of VW's profit.

GM is a lot like VW in volume, but it doesn't have the luxury-brand recognition or sales like Porsche and Audi do.

Cadillac Isn't Alone

All this talk about Cadillac and GM begs the question of how the other truckmakers stand. Ford is currently working on resurrecting Lincoln, its luxury brand. You could literally insert the word "Lincoln" in place of "Cadillac" above and the facts would be the same.

Fiat Chrysler Automobiles is bringing luxury brand Alfa Romeo back to the U.S.)There are plans in place for eight new vehicles to be introduced in the next four years. These vehicles are clearly meant to help create profit at FCA, which has a considerable amount of debt after the merger.

This leaves just Nissan and Toyota. Both companies have a luxury car division (Infiniti and Lexus respectability), and they are both growing.

Forbes reports that "Lexus is the fastest growing manufacturer among the top luxury car brands," and the recent introduction of several models should keep that momentum going.

Infiniti hasn't done so well in the past, yet it is on pace to increase sales by 13.6 percent over last year. Among luxury brands only Lincoln and Lexus have grown faster according to a Motley Fool story.

What does all of this have to do with shiny new pickups loaded with premium features? While it doesn't always seem obvious, the growth of luxury brands and luxury trucks is critical to the future of pickup makers. If those brands and products slip, profit margins shrink and funding for future vehicle innovations takes a step back. As the saying goes, "you fund tomorrow's vehicle with today's sales."

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Comments

Everybody is excited about the 2015 Colorado.
Here are 2 fuel mileage reports at fuelly.com on the 2015
http://www.fuelly.com/car/chevrolet/colorado

Tom#, those numbers are not impressive with such a small truck

Actually I disagree with Tom#3, I am in my 60's and the last type of vehicle I want is my mother's Cadillac. Growing up in the 50's, 60's & 70's makes one less likely to buy what your father or mother had. Of all the luxury brands you are more likely to see those in there 60's buying a Lexus because the are reliable as well as luxurious. Also disagree with Big Al in that those in there 40's are more likely to want a large V-8 powered pickup. Most guys when they get older don't want to drive a large vehicle of any kind. If you go to a Bob Evans or Denny's see how many older guys drive compact and midsize cars, crossovers, and pickups. There are lots of guys in there 60's driving around in Ford Rangers and Toyota Tacomas. It is guys in their 40's that feel a full size 4 wheel drive pickup with a big V-8 makes them a real man.

"Middle America isn't farmers, they are generally suburbanites living outside a city or large town."

Find me one of those people who do not depend on farms or farmers. Just because they think food just magically shows up at supermarkets and restaurants, doesn't make it so.

@Alex--Agree Middle American is made up of subdivisions that were once farms. The closest suburbanites come to being a farmer is buying a John Deere tractor mower to mow their lawn and a roto tiller to plant a garden with a 4 door crew cab pickup to haul the tractor mower and roto tiller to get their Spring tuneup.

@Jeff S and 1LLA, both of you: well said!

It is guys in their 40's that feel a full size 4 wheel drive pickup with a big V-8 makes them a real man.
Posted by: Jeff S | Dec 9, 2014 4:08:05 PM


@Jeff S and 1LLA, both of you: well said!
Posted by: Alex | Dec 9, 2014 6:10:29 PM


Say what now?

funny that motortrend picked the 2009 f-150 over the 2009 ram as the truck of the year back in december 2008. Fast forward to 2015 and ford has an all-new truck that is better than the old model in almost every way including vastly better engines (in 2009 fords top engine was the old 5.4 liter v8). Ram meanwhile has not changed their truck much since 2009. Still has the 5.7 hemi but a new 8 speed transmission and the ecodiesel. As far as I know the interior and exterior of the ram is basically the same as in 2009. And yet motortrend now thinks the ram is better than the much improved since 2009 f-150?

@beast
nothing improved? Led headlights. The new interior is definitely improved. Huge weight savings, better ride, faster even with the carryover engines due to weight loss, much better tailgate step, new features like the 360 camera, better looks imo, almost every review mentions an improved ride and quieter interior. Better gas mileage across the board especially with the new 2.7 ecoboost. Kbb just got 26 mpg on a road trip which is much better than could be had with the 2014 truck. Way more info in the instrument cluster. I've heard it said the seats are more comfortable, flat load floor in back seat, more storage space. And you say it is not improved?

"Pretty easy to get HID on any car and cheap."

No, not if you are doing it the lawful and respectable way by getting your lenses retrofitted or getting projectors to block glare and scattered light. This costs lots of money. It also scatters the light in a way for you to see better and you won't blind others on the road.

Doing it the illegal way by just installing an HID kit into a lens made for halogen light is the cheap way and is disrespectful to other drivers. Not only does this blinds other drivers, but it will blind those that have them in their truck tricking them that they can see better when they actually can't.

In Texas(and most US states), putting HIDs in a lens housing made for halogen bulbs is illegal per US 49 CFR Sec 571.108. You can put HIDs in retrofitted or projector lenses.

So again, no it isn't just pretty easy to get HID in any car cheap unless the already have the lens or projector for it.
Posted by: 1LLA | Dec 10, 2014 12:06:30 AM

Depending on the added efficiency engineers are able to achieve, the improved 3.6-liter engine could help the Ram 1500 regain the gasoline-powered fuel efficiency crown it lost last month to a turbocharged version of the 2015 Ford F-150.

The headlights have been redesigned and equipped with LED lights FOR 2016.

http://www.2016releasedate2017.com/2016-dodge-ram-review-improvements/


Home > DODGE > 2016 DODGE RAM REVIEW AND IMPROVEMENTS
2016 DODGE RAM REVIEW AND IMPROVEMENTS
solaja November 13, 2014 DODGE No Comments

If you are one of those who are looking for a high performance and stylish pickup truck, we sincerely recommend you to wait and see the new 2016 Dodge Ram.

Exterior and interior changes

2016 Dodge Ram belongs to the group of medium size fully equipped trucks. New model will become a lot more modern but it will save its traditional look. Everything on new Dodge will be redesigned and built on a higher level. These improvements also include safety and comfort of the driver. It is made mostly of steel, witch guarantees the strength of the vehicle and safety as well. This mid size truck comes with four doors and a large trailer. The front end and the whole vehicle is redesigned and decorated with high quality materials such as chrome, aluminum and others. On front of the truck we can see beautiful, stunning and powerful chromed grille and redesigned headlights equipped with some beautiful high quality LED lights. Colossal chrome plated bumpers, door locks, fender and special cargo door are just some of the magnificent features on new model. Fog lights and taillights are also redesigned. New 2016 Dodge Ram from outside looks muscular, but interior is very gentle, comfortable and functional. In the cabin, truck will have chrome trim and comfortable seats, upholstered in high quality materials. The improved equipment inside the new model includes an electric power steering device, Bluetooth, new navigation and audio system, reduction of noise and vibration, infotainment system, touch screen display, etc.

2016 DODGE RAM interior
2016 Dodge Ram Engine

There are some speculations that new 2016 Dodge Ram will be fitted with a 3.0 liter Eco Boost V6 engine. This engine is capable to produce about 240 horsepower with 420 lb-ft of torque. Engine should be matted on eight speed automatic transmission and should supply power to all four wheels. Another choice should be 5.7 liter Hemi V8 engine. This powerful engine generates stunning 600 horsepower.

2016 DODGE RAM side1

Release date and expected price

When it comes to the 2016 Dodge Ram release date, so far there are still just speculations. Rumors say that it will appear in the end of 2015. Expected price is around $30,000 for the base model.

Hemi
So you're telling us to wait another year for the Ram 3.6 Turbo?
I can't wait that long, I need a new truck NOW !
Ram screwed up, they should have that V6 turbo NOW to compete with the 750,000 F-150's and 500,000 Colorado, Canyons that will be sold in 2015.
Ram will be too late for the party, the truck market will be all used up by then!

WAIT ??? I always thought Ram always said adding a turbo to a gas V6 wasn't the right way to go? I thought Ram always claimed their non-turbo V6 and even their cyl deactivation V8 Hemi got BETTER gas mileage than the F-150 V6 turbo?

Then WHY is Ram going turbo?

( I will answer that for you)

Oh! I get it ! The Ram non-turbo 3.6 V6 DOES get better gas mileage than the F-150 turbo ,,, BUT,,, wait for it, wait for it IT doesn't have the horsepower and torque and performance as the F-150 turbo.

Thank You Hemi for keeping it honest.

I think the market for vehicles is much more detailed than just assuming that a certain age group is going to buy a specific vehicle. You need to look at the stages of people and families--single and first time in the workplace, newly married, young children, teenage children, children in college, empty nesters, those who are nearing retirement or are retired, and those at the age where there next vehicle will be there last. A family with younger children or children in their teens living the suburban life and making runs to Home Depot or the garden center would be a sizable market for a crew cab full size and midsize truck as their second vehicle. A smaller crossover or extend cab pickup of any size would be target for both the empty nesters, those retired, and younger individuals or families. Not to generalize too much but those starting out cannot afford as much but as they get better jobs and pay and as their families grow they need a larger house and a larger vehicle. Most of us as we get older will downsize and get rid of excess things, move to smaller homes with less maintenance, and want smaller vehicles. Again this is a generalization and not meant to apply to everyone. If you look at the articles on TTAC you will see that vehicles like the Kia Soul and the Honda CRV sell to both younger and older people. Most of those in the middle will be the majority of the customers for the F-150s, Buick Enclaves, and Toyota and Honda mini vans. Again these generalizations do not apply to everyone but this is what the vehicle manufacturers and other producers and marketers of consumer products as well.

I'LL ANSWER.

LED IS BETTER.

JUST WAIT FOR THE 2016 RAM, LIKE I TOLD YOU IN THE FIRST POST.

FINAL ANSWER!

ALL - The truth will set you free. The bottom line is you bought a Ram when you could have bought ANY other truck. Enough said!

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RAM

Actually I disagree with Tom#3, I am in my 60's and the last type of vehicle I want is my mother's Cadillac. Growing up in the 50's, 60's & 70's makes one less likely to buy what your father or mother had. Of all the luxury brands you are more likely to see those in there 60's buying a Lexus because the are reliable as well as luxurious. Also disagree with Big Al in that those in there 40's are more likely to want a large V-8 powered pickup. Most guys when they get older don't want to drive a large vehicle of any kind. If you go to a Bob Evans or Denny's see how many older guys drive compact and midsize cars, crossovers, and pickups. There are lots of guys in there 60's driving around in Ford Rangers and Toyota Tacomas. It is guys in their 40's that feel a full size 4 wheel drive pickup with a big V-8 makes them a real man.
/QUOTE

Thats a bit of a non SEQUITOR fallacy there,bud!
Many women drive big trucks if you haven't noticed..

I drive pickup for several reasons the main one being SAFETY,,it's easy for other drivers to see avoid and give me space,,

second one is Rear wheel drive which is superior for driving in any weather
Third I'm a carpenter and even though retired I occasionally need to carry heavy long materials ..
I also carry my house on it when traveling..



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