The Sedan Continues to Die as GM Cuts Production
Today GM announced, in typically cryptic corporate-speak, that it is undergoing a "staffing transformation" and will soon have five "unallocated plants." In other words, it's firing a bunch of people-14,300, or thereabouts-and closing down plants. There are many reasons for the layoffs, including Trump's new tariffs, which GM warned could add more than $700 million to its costs this year. But the major scapegoat is one that's been a popular punching bag lately: sedans.
Nobody's buying sedans, says GM. Accordingly, the cars to be axed are all sedans, including the Cadillac CT6 and XTS, Chevy Impala, Cruze and Volt, and Buick LaCrosse.
Part of the problem here, I might suggest, lies with GM's absolutely bananas pricing on some of its sedans. Consider the LaCrosse: In its most humble powertrain configuration-four-cylinder, front-wheel-drive-it's possible to option a LaCrosse past $45,000. That's for a mid-level model. A loaded Avenir can go well past $51,000. Meanwhile, $45,000 will also get you a Lexus ES350 with Premium package, navigation package, driver assist package and a rippin' 302-horsepower V6.
Who are the decision-makers at GM survey this scene and say, "You know, we think people are gonna pay more for a Buick than a Lexus"? The redesigned ES is selling well, with October sales volume up 35 percent over last year's numbers. The Toyota Avalon-the ES350's less-expensive cousin and the car that would probably be shopped against the LaCrosse in real life-is up four percent for the year. A loaded Avalon Limited (which also has a V6) costs $42,695. See the problem here? It's not that there's no cohort of buyers looking for a roomy, posh, soft-riding sedan. They just don't want to overpay for one.
And it's not just Buick. A decked-out Cadillac CT6 costs about $92,000, which is Mercedes S-Class territory. I love the CT6-it's great to drive, offers the best stereo in the business and is the industry champion at autonomous highway driving-but 92 grand is a lot of dough for a car that's a size smaller than the upper-echelon Euro machines. And doesn't offer a V8, although apparently it'll get one sometime before GM kills it, in finest "make the car the way it should've been all along and then cancel it" GM tradition.
Yes, all sedans are facing sales challenges as buyers gravitate to crossovers and trucks. But what we're seeing with GM (and Ford, and Chrysler) is an aggressive culling of the herd. Let's hope that GM's "unallocated" plants are able to start building whatever it is people want to buy. In the meantime, it's looking like the only sedans we're going to have left will be the ones that are so cool they defy the crossover-truck mania. Looking for a note of hope? So far this year, Alfa Romeo Giulia sales are up 36 percent.
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