The Cadillac division of General Motors Co. (NYSE: GM) would like luxury car shoppers to believe its new ELR electric car is a better vehicle than a Tesla Motors Inc. (NASDAQ: TSLA) Model S. Cadillac goes so far as to make the contrast explicit as a tries to market the ELR. Unfortunately for the U.S. car brand, Tesla has several advantages. This is among the reasons that GM’s luxury division has struggled as it tries to match the sale of major imports.
On paper, the ELR and Model S are mostly equivalent vehicles. The Cadillac carries a price of $75,000 to the Tesla’s $69,000. Each has features that are standard on most luxury cars. These include traction and stability control and 50,000 mile warranties. However, consumers who take a closer look will find important differences. First, the ELR is really not an electric car at all. It has small gas engine that can power the car when its electric charge has run out. If the Tesla is considered the car of the future, the ELR is a hybrid from the past, not terribly different from the aged Chevy Volt.
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Another difference between the two cars is that the Cadillac has front-wheel drive to the Tesla’s rear-wheel drive. And the Cadillac is a coupe while the Tesla is a four-door sedan.
Cadillac also suffers from an image problem that probably hurts the sales of all its models. Americans clearly prefer imported luxury cars. BMW, Audi, Lexus and Mercedes handily outsell Cadillac, along with Ford Motor Co.’s (NYSE: F) Lincoln luxury brand.
But the primary drawback the ELR has is that consumers who want a true electric car will turn down the Cadillac before they start shopping.
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