GM takes the plunge with Chinese Cadillac exports

GENERAL Motors will start exporting its all-new flagship Cadillac CT6 PHEV (plug-in hybrid vehicle) from China to North America late this year in a move that could prove to be a watershed in international car manufacturing.

Although the numbers will be small – an estimated 1000 vehicles a year or just five per cent of CT6 sales in the US – the significance of such a quintessential American brand sourcing its most sophisticated product from its joint-venture plant in Shanghai will not be lost on anyone on the car industry.

The full-sized but lightweight limo was designed by a team led by former Holden designer Andrew Smith and sits on a revolutionary new mixed-material platform, called Omega, engineered by a team led by Australian Trevor Hester.

The petrol-electric version, using a drivetrain with many components lifted from Chevrolet’s new Volt, will only be built in China where it is scheduled to be launched late this year.

The bulk of CT6 production, using twin-turbo V6 and V8 petrol engines, will be made in GM’s Detroit-Hamtramk plant, with sales set to start in the US next week.

The plan to export the Chinese CT6 PHEV was first reported in Detroit this week and then confirmed by GM spokesperson David Caldwell to The Wall Street Journal.It will become the second Chinese-made GM product to be confirmed for North American sale, with the Buick Envision mid-size SUV already a lock for the US.

With its Chinese joint-venture partner SAIC (Shanghai Automotive Industry Corporation), GM is China’s biggest motor manufacturer, selling a record 3.6 million vehicles in 2015 – more than it shifted in its home market.

Cadillac sales in China soared 17 per cent, to almost 80,000 units. The luxury wing of GM hopes to achieve 500,000 global sales by 2020, up from 277,868 last year.

While the CT6 and Envision will be the first Chinese-made GM vehicles to land in US showrooms, Volvo has already beaten them to the punch, starting exports of the long-wheelbase S60 Inscription from the south-west Chinese city of Chendu to North America last year. Again, these are small numbers, as a toe-in-the-water exercise.

Until now, Chinese vehicle exports have been largely confined to Chinese domestic players attempting to find a global footing. These have included Chery, Great Wall and its Haval SUV sub-brand, Geely, Foton and SAIC’s MG.

While they have enjoyed some level of success in developing markets, poor quality and less than satisfactory safety ratings have largely stymied growth of Chinese vehicles in western markets such as Australia where sophisticated, well-entrenched players armed with high quality products have provided stiff opposition.

In the case of Cadillac, GM has spent large sums to prepare its Pudong factory, in the suburbs of Shanghai, for CT6 production, and will be extremely mindful that any misstep could skittle Chinese vehicle sales in the US and other western markets for a long time.

On the other hand, a successful export program with consumer acceptance could open other doors for Chinese vehicles on the world stage, not just for GM but many other manufacturers, including GM's major rival in China, Volkswagen and its luxury offshoot Audi.

For Australia, a Cadillac rebirth with the CT6 after the still-born effort in the global financial crisis will hinge on new diesel engines that are said to be in the pipeline for future models.