General Motors Company (GM): Cadillac’s 2013 ATS Has Changed the Game

Ford Motor Company (NYSE:F) has created one of the most impressive turnarounds in business history and leads General Motors Company (NYSE:GM) in many ways. However, Ford trails its rival in one key area for future growth — having a successful luxury line. Lincoln has been forgotten in Ford Motor Company (NYSE:F)’s turnaround story, while Cadillac is on fire right now, much to the delight of GM’s management. Let’s look at how the ATS is helping driving success at Cadillac and how it changed the game for consumers and investors.

Welcome back, Cadillac

2013 Cadillac ATS. Photo Courtesy of General Motors Company (NYSE:GM).

“Cadillac is back.” said Bob Ferguson, vice president, Global Cadillac. “Our growth is product-driven, new luxury vehicles with dramatic design and performance drawing new customers to showrooms.” So far this year Cadillac has seen its largest sales increase since 1976 – nearly four decades.

“Think about that,” Kurt McNeil, General Motors Company (NYSE:GM)’s vice president of sales operations, said in a conference call earlier this month. “We’re talking about the days of disco, when Cadillac was strictly a U.S. brand back then, not one that’s directly challenging the German luxury brands and gearing up to triple its sales in China over the next couple of years.”

In addition to the surge in sales, roughly 70% of Cadillac ATS buyers are buying their very first Cadillac. That’s a huge percentage and represent incremental sales and market share stolen from competitors – a huge win for Cadillac and no small reason for this year’s Cadillac surge.

The 2013 Cadillac ATS offers a unique choice to most luxury cars, a 2.0L turbocharged engine with a manual transmission. For those looking for a sporty and luxurious ride, the ATS can be equipped to meet that expectation. Its engine lineup has a 2.5L four-cylinder as well as a 2.0L turbocharged four-cylinder while still offering a 3.6L V-6. The 2.5L engine puts out about 202 HP while the 2.0L turbo puts out an impressive 272 HP. As impressive as the 2.0L engine is, being one of the most power dense engines in the industry, the award winning 3.6L V-6 tops it with 321 HP — nearly as much HP as my 2010 Mustang GT.

Once consumers take the flashy ride for a spin, it’s evident the luxury sport sedan is as nimble and exhilarating as Cadillac claims. It’s assumed that this ride would be luxurious, but in addition to the horsepower, the interior technology gives consumers a superior feel. That’s backed up by Edmunds.com noting the ATS finally gives the U.S. a medal-worthy vehicle in the segment and consumers reviewing the ATS with an average of 4.5 out of 5 stars.

2013 Cadillac ATS. Photo Courtesy of General Motors Company (NYSE:GM)