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Cadillac XLR Forum Discussion, XLR inventory among highest in the industry in Past Cadillac Vehicle Discussion; Katshot, Toyota was actually fined by the FTC for selling the first year Lexus LS 400s for under manufacturing costs. ...
  1. #31
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    Re: XLR inventory among highest in the industry

    Katshot,

    Toyota was actually fined by the FTC for selling the first year Lexus LS 400s for under manufacturing costs. I thinkits called Product dumping. I'm sure Toyota has made any fines back since then.

    The problem with the XLR is it's a lot of cash for a car with less performance than the Corvette and others. Even with the V it isn't certain it will blast by the Chevy. Pricing is the issue and the economy (GM stock down by 14%, crude at record $56/barel) may be to slow to support the asking price. Unfortunetly for GM the XLR is a bit to exclusive.

    The problem is if you start selling them for too much of a discount you risk pissing off customers who paid more earlier on. Benz had this issue back in the early 90s when it sharply discounted some of its most expensive units. Previous buyers wanted some money back. I think some took them to court.

  2. #32
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    Re: XLR inventory among highest in the industry

    Quote Originally Posted by BANK
    Katshot,

    Toyota was actually fined by the FTC for selling the first year Lexus LS 400s for under manufacturing costs. I thinkits called Product dumping. I'm sure Toyota has made any fines back since then.

    The problem with the XLR is it's a lot of cash for a car with less performance than the Corvette and others. Even with the V it isn't certain it will blast by the Chevy. Pricing is the issue and the economy (GM stock down by 14%, crude at record $56/barel) may be to slow to support the asking price. Unfortunetly for GM the XLR is a bit to exclusive.

    The problem is if you start selling them for too much of a discount you risk pissing off customers who paid more earlier on. Benz had this issue back in the early 90s when it sharply discounted some of its most expensive units. Previous buyers wanted some money back. I think some took them to court.
    No kidding? I didn't know that about the FTC fine. Still, I think extremely aggressive pricing (not below cost) is a better idea, until the model or brand is established.
    I think you're conclusions are right and I think we both realize that Cadillac is in a very tough position.

  3. #33
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    Re: XLR inventory among highest in the industry

    Cadillac and American car Manufactures may find a little relief in the near future in that many of their direct competitors will have to substantially increase their product price.
    Early last year Porsche and BMW began to hedge against what they predicted would soon be a weak dollar. This has really worked out nicely for them this past year as the Eur/Usd exchange rates have really gone way up. I believe that Porsche is hedged through Eur/Usd 1.3000 and BMW is hedged through Eur/Usd 1.2500. As of today, I think the rate is about 1.3400. They're starting to feel the pressure as they're no longer covered.
    These companies will be forced to increase prices to compensate for the dollar or take it in the shorts on their bottom lines.
    In the late 80's during another period of weak dollar, Porsche attempted a rise in price of nearly 50%. In their own words, "it nearly wiped out our American business."
    They've got their work cut out for them. M5's would sell like hot cakes for $80k or maybe even $90k. I wonder about $110k or $120k?

  4. #34
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    Re: XLR inventory among highest in the industry

    Allow me to ask this question- How many BMW 6 Series have all of you seen on the road? Not many I am sure. I live in an area of the country where there is lot's of money and I have seen about as many XLR's in the Hamptons as BMW 6 Series.


    These are cars that will cost over $80,000 out the door.. That makes it the most expensive Cadillac ever! Hence, GM had low sales goals as they knew this was going to be a " Halo" car of the brand and hoepfully attract many new Cadillac owners. The fact that there is inventory has EVERYTHING to do with the bad winter the entire country has had as convertable sales are driven by nice weather.

    I love the XLR and would like to someday have the XLR-V share my garage with my AWD V8 STS & SRX. As a weekend only toy of course....

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    Re: XLR inventory among highest in the industry

    I dont think anyone is arguing that its a beautiful execution of automotive engineering and a perfect halo car for Cadillac. The problem is the price is not in line with the interior or exterior expectations the car creates, its simply not justified. Heck, ask me? I dont think 80k is justified for the 6 series either, I think the 6 is also overpriced, so no surprise that thing isnt doing too well (though I think its meeting its goals at least). I mean, its a coupefied 5 series, and youre going to trick me into paying at least 20000 more than a similarly equipped 5 series? I dont think so.

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    Re: XLR inventory among highest in the industry

    Quote Originally Posted by Playdrv4me
    I dont think anyone is arguing that its a beautiful execution of automotive engineering and a perfect halo car for Cadillac. The problem is the price is not in line with the interior or exterior expectations the car creates, its simply not justified. Heck, ask me? I dont think 80k is justified for the 6 series either, I think the 6 is also overpriced, so no surprise that thing isnt doing too well (though I think its meeting its goals at least). I mean, its a coupefied 5 series, and youre going to trick me into paying at least 20000 more than a similarly equipped 5 series? I dont think so.
    Do you have a link for the XLR's sales goals? And actual sales?

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    Re: XLR inventory among highest in the industry

    Maybe dealerships tacking on as much as 15k to the price when they first came out pissed some people off... me included. So now they are sitting on a surplus? Ha! You reap what you sow... and trying to gouge customers won't get you very far.

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    Re: XLR inventory among highest in the industry

    Quote Originally Posted by HITMONEY
    Maybe dealerships tacking on as much as 15k to the price when they first came out pissed some people off... me included. So now they are sitting on a surplus? Ha! You reap what you sow... and trying to gouge customers won't get you very far.
    As if thats not bad enough, there are still dealers out there who REFUSE to deal on XLR pricing. Its like they have a golden nugget on their hands or something.

    XLR's will soon also be sold in China, and produced in China. Models produced there won't be exported here, but I cant imagine they could possibly demand 80 large for a Chinese built car that barely sells here. With this and their own press release on sluggish sales in mind, I have a feeling that they may in fact adjust the pricing strategy on some GM products to help boost sales a bit. I think that "incentives" need to go the way of the dinosaur, and the cars just need to plain be priced lower from the get-go, which would also help with re-sale value in the long run.

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    Re: XLR inventory among highest in the industry

    Playdrv4me,

    Do you have a link for the sales goals for the XLR?

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    Re: XLR inventory among highest in the industry

    I dont have a link for the info, however I am fairly certain the sales goal for the XLR for 2004 was roughly 6,000 units per year. Deliveries of XLR units to DEALERS by the end of 04 were actually UP 39 percent, which was an encouraging sign, however the problem lies in the fact that dealers have been unable to move the cars and the inventories are piling up, theres still a ton of 04's out there, and as I mentioned before, some dealers are reluctant to discount them. This reflects in the hard GM sales figures which as of last Nov. were down 17 percent for cars only.

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    Re: XLR inventory among highest in the industry

    Cool. Looks like I'll have to take your word for the 6,000/units. I'm surprised that a manufacturer would release their sales goals like that. It sure is a way to make them look ridiculous down the road if they are way off! I suppose that it’s for the financials and for the share holders, huh?

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    Re: XLR inventory among highest in the industry

    If you have time, you could dig through articles that talked about the XLR before it came out. They usually make comments about how many units they intend to sell.

  13. #43
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    Re: XLR inventory among highest in the industry

    Thats the problem, and the reason why I dont have a link for you. That number has stuck in my head only because I saw it either in Autoweek, or some sort of print publication, but I KNOW it was in the 6K territory. Its also nearly IMPOSSIBLE to find if you do a search for any kind of sales figure data, they seem to keep it very highly guarded for just the reason you mentioned. In fact, on some models, in some markets there are NO DATA available for sales goals as well, not even within the company. I found this out recently and can't figure that one out either.

    People who can shed light on this are probably msheri01 and a couple of other "industry insiders" who frequent this forum.

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    Re: XLR inventory among highest in the industry

    It's interesting that y'all talk about dealers who aren't willing to negotiate on the price of the XLR - because I didn't have any trouble at all when buying mine.

    I visited three dealers in Dallas and spoke with two in Tampa, and all of them - without exception - were willing to negotiate on price. I ultimately bought my XLR (MSRP $76,975) for invoice ($71,300) from Dimmitt Cadillac in Clearwater. I had a similar offer from Sewell in Dallas, but they were adding the Dallas Regional Advertising fee of $1,300, which made the Florida offer more attractive. Coupled with Texas' bizarre method of leasing, the Florida deal was $6400+ more attractive than the Texas offer.

    Either way, I didn't find anyone refusing to talk on the price of the XLR. Some talked more than others, but no one was absolutely intransigent.

    I also noticed that both Sewell and Dimmitt have limited or no XLR's in stock. I had to wait for a truck to deliver mine to Dimmitt, from Bowling Green, because there aren't any of them on the ground. Of course, that may be more of a factor of location than anything else. Dealerships in warm locations - like Dallas & Clearwater - will likely have a much easier time in selling a droptop than would someone in, say, Buffalo.

    With regards to the price, if you can get the car at invoice ($71k) then I don't really see it as being too overpriced. It's a steep price, but not overly so. I priced a loaded C06 (NOT Z06) droptop and it came in at $64k, and the Chevy dealerships were less willing to talk than were the Caddy dealerships. The end-cost on the C06 was in the high fifties ($58-$59), so the price differential between the C06 & XLR of around $13k doesn't seem to be that far out of line to me.

    I had a much more difficult time talking with the Audi dealers about an $83k 2005 A8 (which has absolutely abysmal resale value) than I did from any of the GM dealerships. I know this is just my experience, but that's the way I see it!

    Regards,

    JW

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    Re: XLR inventory among highest in the industry

    The March Madness sale running now also reflects the inventory levels of some of the Cadillac vehicles right now...

    From CNN Money...

    "Thursday, a new U.S. incentive program is going into effect that includes an extra $1,000 cash rebate on most vehicles that have been in inventory for about 125 days or more, and $1,500 on some Cadillacs."

    Now, the XLR is not getting money back, but it does feature a 5.9 percent discount finance rate. The SRX has 1500.00 back PLUS discounted extended term financing. Heres the REAL deal of the group, the highest incentivized vehicle?

    Pontiac Bonneville... 3.9 percent for 72 months, PLUS 2500.00 Cash back. Uhh, I think its time to go scoop up some Bonneville GXPs!

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