GM's Cadillac aims high for Catera replacement May 31, 2001 The new head of General Motors Corp.'s Cadillac division expects U.S. sales for the new CTS entry-level luxury sedan to hit about 30,000 in its first year, according to a Reuters report by Michael Ellis. This would top the poorly received Catera, which it replaces. "We'd be shooting for 30,000 units. It's ambitious compared to our historical penetration with that segment," Mark LaNeve told reporters May 29. LaNeve, former head of U.S. sales for Ford Motor Co.'s Volvo unit, joined Cadillac last month to replace Michael O'Malley, who resigned to head global advertising and marketing for Ford. Cadillac may hope the sharper-edged styling of the CTS will erase memories of the Catera, which never lived up to expectations. U.S. sales of the Catera peaked at 25,411 in 1997, its first full year of production. Despite heavy consumer incentives, U.S. sales dropped to 15,068 in 1999, rising slightly to 17,290 in 2000. Cadillac also hopes the division's new styling will help attract younger buyers, a market segment Cadillac has had trouble with in recent years. The CTS will go into production at GM's new Lansing, Mich., assembly plant late this year, and officially go on sale in early 2002. Prices are expected in the $30,000 to $35,000 range. LaNeve said the CTS will be bigger, with bolder styling, and priced for value to compete in the entry-level luxury segment against the BMW 3 Series, the Mercedes C-Class, the Audi A4, and the new Jaguar X-Type. Later, the CTS will go on sale in Europe, where Cadillac hopes to expand sales. Automakers are aggressively courting the entry-level luxury market with lower-priced entries. LaNeve said he expects some luxury brands to begin offering lower-priced models starting around $24,000, but Cadillac may not compete in that lower price range. The CTS arrives about the same time as the new Cadillac Escalade EXT, similar to the Chevrolet Avalanche full-size sport utility vehicle/pickup truck crossover. LaNeve said he expects annual sales of about 10,000 to 12,000 for the EXT. Once the top U.S. seller of luxury vehicles, Cadillac sales this year have dropped a precipitous 26.4 percent to 42,235 units, putting Cadillac in fifth place behind BMW AG, DaimlerChrysler AG's Mercedes, Toyota Motor Corp.'s Lexus and Ford Motor Co.'s Lincoln. Cadillac officials said part of the drop was due to the decision to back off fleet sales to daily rental agencies during the first half of this year in order to boost resale values.