GM tests limits of Cadillac’s brand power with $300,000 Celestiq electric car

DETROIT – Cadillac is testing the limits of its brand allure and pricing power with the 2024 Celestiq – a large, bespoke electric car that will start at more than $300,000.

The vehicle – unveiled Monday night – launches the General Motors brand into the ultra-luxury segment against the likes of Bentley and Rolls-Royce. It’s something no American brand has successfully done in modern times.

Executives say the vehicle is more about creating a “halo car” that helps burnish Cadillac’s image, rather than fueling overall sales or profits. But, if successful, it could create a new two-unit business model for the company: one focused on hand-built, high-end vehicles and the other on mass-produced models.

“It is a brand builder. It’s a halo vehicle. It will lift people’s perception of the brand,” Rory Harvey, global vice president of Cadillac, told CNBC. “The business case has and continues to evolve, but it’s not just purely about the car. It’s about what it does for Cadillac and how it lifts the other Cadillac variants.”

Harvey declined to discuss the vehicle’s profit margins or whether the company plans to add additional hand-built models.

Customers will be able to customize nearly all aspects of the vehicle’s interior trim, exterior color and other nonmechanical elements. They’ll be able to work with designers and a Cadillac concierge to customize their vehicle.

“I don’t want to see this as a Mary Kay car, but the reality is, if you want to do an outrageous car, that’s the point,” said Michael Simcoe, GM vice president of global design, citing the unique “santorini blue” of the Celestiq unveiled Monday night.

Despite growing concerns around the demand for new mass-market vehicles due to rising interest rates and record prices, ultra-luxury buyers have continued to spend.

GM plans to only produce hundreds of Celestiq cars per year. It will only have capacity to build fewer than two vehicles per workday, Harvey said. The car will be sold globally, with the largest markets expected to be the U.S. and China.

The Celestiq will be available by request only, with “a significant deposit” needed to begin the build process, according to Harvey. Ordering for the car will start as early as later this year, followed by production beginning in December 2023, according to GM.

In June, GM announced it would invest $81 million at its tech center in suburban Detroit to hand-build the Celestiq – marking the first time it will produce a vehicle for commercial sales at its massive campus in Warren, Michigan.

The Celestiq, which GM previewed earlier this year, is big. At roughly 18 feet long and 7 feet wide, it is wider and longer than a Cadillac Escalade SUV. It is based on the automaker’s Ultium electric vehicle platform, but with an exclusive car structure.