Cadillac, despite considerable progress on quality and performance issues (e.g. Cadzilla anyone?) has another major problem that is again entirely of it’s own making… they can’t compete with lease deals offered by other manufacturers.
Just 6% of Cadillac customers in August leased a vehicle as opposed to buying one, according to Edmunds.com. That compares to 32% of customers taking the lease option at the five import luxury brands that Cadillac competes with: Mercedes, BMW, Lexus, Audi and Acura.
With the residual value of Cadillac so low the leasing companies can’t offer a low monthly payment without taking a bath on the backend of the lease. When GM and GMAC were one in the same it was easy for GM to bury that fact in order to remain competitive with leases, they can’t do that anymore and sales are drying up. I don’t like leases but if I were in the market for a lease I would probably look at Acura or Lexus, both of which have the best resale values which means the amount of depreciation you are financing is considerably less than any other manufacturer.
Cadillac can “get aggressive” all they want with lease deals but unless the underlying brand issues are resolved nothing material will change and GM will continue to buy customers.