GM will end XLR

[Rob]

GM will end XLR

Production will stop; about 40 local workers to be laid off

By JENNA MINK, The Daily News, jmink@bgdailynews.com/783-3246
Monday, January 26, 2009 11:49 AM CST

General Motors plans to end production of the Cadillac XLR, which is made at the General Motors Bowling Green Assembly Plant.

The company anticipates production will cease this spring, impacting about 40 employees at the plant, said Sharon Basel, communications manager for General Motors.

The plant employs a small assembly crew dedicated to XLR production. Those employees were recently notified of the production cut. It has not yet been determined when those workers will be laid off, but it will likely be this spring, said Paul Graham, plant manager.

“Obviously, it’s difficult when a plant loses a product,” he said. “We want to continue to grow our volume as much as we can. So it’s been difficult.”

The plant is closed until Feb. 23 because of GM’s financial woes and about 154 workers, in both XLR and Corvette assembly, will be indefinitely laid off by March 1.

“No one’s really happy about (the XLR loss),” Graham said. “Everyone in the plant wants to do what we can to build great vehicles. No one’s feeling good about it.”

GM decided to stop XLR production as part of a strategy to help conserve money. The XLR was chosen to be eliminated after a year of slipping sales, Basel said.

“Models like the XLR often have limited product life cycles,” she said. “Difficult decisions have to be made to ensure that we can continue to develop, engineer and produce the most critical products in our portfolio.”

And during a recession, consumers are leery of purchasing high-priced vehicles, she said. Local prices for the XLR are listed from $87,000 to $106,000, according to Cadillac’s Web site.

“It’s very specialized in terms of who would buy a vehicle at that price point,” she said. “We’re seeing the market downturn impacting all segments and some more severely than others.”

Sales of the XLR decreased 28 percent last year compared to 2007. About 1,250 XLRs were sold in 2008, Basel said.

As consumers try to cutback spending and buy more practical vehicles, it is not surprising that XLR sales have plunged and GM has cut its production, said Bill Parsons, managing director for the Global Advanced-Leadership Center and chair of the Global Automotive Conference.

“The XLR is a very nice vehicle, but people are making choices to buy more serviceable vehicles that’s a greater utility to them,” he said. “I think it is something to be anticipated, and the XLR will rebound, but it’s going to take a more sound economy.”

Still, the plant focuses the bulk of its production efforts on the Corvette, a vehicle that Parsons said will survive the national automobile crisis.

“I think the Corvette will be fine,” he said. “The Corvette has a real broad appeal ... Corvette has an increasing appeal outside the United States, too, so that’s a positive.”

[XLR-V Lover]

[jhansen]

Rob
I guess that means that the existing XLRs are probably going to increase in value, huh?

Does anyone want to venture a guess as to what will happen with parts and service availability?

John

[XLR-V Lover]

Sorry, the values will drop. . . as will the available parts supply. IMHO.

Floyd (BB)

[Lola's Mom]

This is just soaking in - I feel like I've just been hit in the gut ...

My luxury roadster has just become a collectible, and right now I'm not sure there's any value in that. And I certainly wasn't expecting that to happen after the way they premiered the 2009 in Bowling Green. It's like we've been duped.

[FOURTEEN]

Rob
I guess that means that the existing XLRs are probably going to increase in value, huh?
John

Well, even though my "crystal ball" is in for its 10,000 year check-up, I'll attempt to make an educated guess about your question! I would hazard a guess that yes, your car may well be a future collectible at some point in the future. Obviously, the car must get through the depreciation curve in excellent condition and be well taken care of, maintained, and so forth. The saying "they are only original once" comes in here. But, that having been said, you also must realize that while time marches on, this car (assuming I'm guessing right) won't be considered collectible for another 15 to 20 years. That's the normal course of events in these situations.

So, just enjoy one if you have one, but don't plan on getting rich from it any time soon!!




/

[Rob]

Well, even though my "crystal ball" is in for its 10,000 year check-up, I'll attempt to make an educated guess about your question! I would hazard a guess that yes, your car may well be a future collectible at some point in the future. Obviously, the car must get through the depreciation curve in excellent condition and be well taken care of, maintained, and so forth. The saying "they are only original once" comes in here. But, that having been said, you also must realize that while time marches on, this car (assuming I'm guessing right) won't be considered collectible for another 15 to 20 years. That's the normal course of events in these situations.

So, just enjoy one if you have one, but don't plan on getting rich from it any time soon!!




/

I tend to agree with this. However, I think it also depends on the production numbers.

I bought a 1990 ZR-1 with 179 miles on it in late 1994. I currently have just over 30K miles on it and it's basically in the same condition as it was when it rolled off the Assembly Line in April of 1990. However, the value of the car has continued to drop...I think it's almost bottomed out, but I'm not really sure.

In 1990, they built just over 3,900 of them. By 1993 - 1994 they were building just 445 per year and bumped the horsepower up from 375 to 405. These three years command a higher price than the first generation ZR-1s, but that also has to do with mileage as well. I'm not sure we've seen the value of these bottom out just yet.

With the XLR, if you look at the production graph I've built here:

http://www.xlr-net.com/specs/production.html

...you'll see that there's a similar production trend with the XLR, it's just that the numbers are a magnitude higher than they were for the ZR-1.

So, I think that the value of the XLR will continue to decrease, and it may be 15 - 20+ years before they bottom out and start to stabilize.

[speedway]

Right now GM is in a serious bind however, if they do what they have planned they will be left with Cadillac, Chevy and Buick. Years ago Cadillac maintained its value because GM would not let its value deterate. There are four cars that I am aware of that do this Lexus, BMW, Mercedes and Corvette. GM will have a XLR or another name top end Cadillac they just wont give the market to Lexus, BMW and Mercedes in my opinion. While they may stop now until they work out there problems and the economy gets back on track there will be a return. In the mean time we have a very unique automobile that gets a lot of attention no matter where you drive it. With that said the true value of the car is with the person who drives it and everyone mesmerized that wants it.

Speedway

[FOURTEEN]

So, I think that the value of the XLR will continue to decrease, and it may be 15 - 20+ years before they bottom out and start to stabilize.

The good news, for folks like me who do not own an XLR, is that we may soon be able to afford and enjoy a great car! The depreciation that the XLR has suffered is astounding! However, it is still 99% the same nice car regardless of the year or the 'market value'! I don't expect to ever see an XLR as someone's 'beater'!! The XLR, and particularly the XLR-V, has high quality and strong intrinsic value.

The advantage that the XLR has is that, with so few around, it really stands out in a crowd. I have never actually seen an XLR in person!
With apologies to special Corvette or Mustang lovers, when I see a Corvette or Mustang on the road, all I see is a Corvette or a Mustang. Whether it is a Shelby something, or a ZR or C something, or high or low production, or what year it is, are all pretty much invisible to me! It's just another Corvette or Mustang!! Even the new 2010 Mustang, which I saw at a car show on TV and was touted as such a masterpiece, really looked like 'just another Mustang'!!
So the uniqueness of a used XLR may make it much more desirable as a ‘look at me’ car, and actually an excellent value!


PS: Looking at the designs of new CTS Coupe and CTS Sport Wagon, in 15 - 20+ years the current XLR may seem more like a P51 than a F22!!!


.>>

[Lola's Mom]

Now that the car has become a collectible ... have any of you thought about what you might do with the car?? Keep it? Trade it in? Sell it?

[Rob]

I spoke with David Caldwell from Cadillac Communications and asked him if the rumors were true, if there was any chance that the model would be resurrected for 2010 if GM's finances improved, and what would happen to that section of the Bowling Green Assembly Plant after the 2009 MY. This is what he had to say:

Hi Rob, thanks for the note.

What is happening is that we're setting into motion a plan to conclude production of the Cadillac XLR at the end of the current model year (09). That means doing things like enacting adjustments at the Bowling Green plant, gathering final orders from dealers and making other preparations. Those preparations involve various people - staff at Bowling Green, our dealers, suppliers, etc. And that's why this is coming to light now.

The reasons for this are pretty straightforward - and there are 2 basic factors: 1) Overall industry sales volume is under great pressure, across the spectrum. Many automakers and brands are making curtailments/adjustments in response to this. 2) The "lifecycle" for speciality sports cars like XLR is often limited. This sort of very special car is not necessarily a permanent fixture in a brand's lineup - particularly in a period of great economic strain.

Combine those two factors (greatly lower total industry volume and the somewhat limited lifespan of many specialty sports cars) and you have the basic explanation for what's happening with XLR. XLR accomplished a lot for Cadillac -- it brought great design presence, while injecting the brand with serious performance and technical attributes. The upcoming CTS Coupe (launching in 2010) will deliver on those aspects very nicely for Cadillac. While it is different from XLR, we think it is a sports car offering very well in tune with the changing priorities of luxury/sports car buyers. And our remarkable new CTS-V (launched 2 months ago) takes our performance bona fides to a new high point. Cadillac is also launching a CTS Sport Wagon in May, and the new SRX Crossover in summertime. So, in the near term Cadillac's lineup grows, notwithstanding the conclusion of XLR production. Frankly, the fact that CTS Coupe will be accessible to a larger audience, with a wider array of engines (esp V6s) we view as a real opportunity to expand Cadillac lux/sports car business.

I would not look for a resumption of the XLR in 2010 - those preparations listed above are intended to wind-down production and ordering. If we thought we might resume the car shortly thereafter, we would be making these sorts of adjustments. As for the physical aspect of the XLR assembly area, I'm honestly not sure how the plant will handle that - and I would say that right now it may be too early to say what their plans for that area will be specifically.

Hope that helps

David Caldwell
Cadillac

[Little Woman]

Right now GM is in a serious bind however, if they do what they have planned they will be left with Cadillac, Chevy and Buick. Years ago Cadillac maintained its value because GM would not let its value deterate. There are four cars that I am aware of that do this Lexus, BMW, Mercedes and Corvette. GM will have a XLR or another name top end Cadillac they just wont give the market to Lexus, BMW and Mercedes in my opinion. While they may stop now until they work out there problems and the economy gets back on track there will be a return. In the mean time we have a very unique automobile that gets a lot of attention no matter where you drive it. With that said the true value of the car is with the person who drives it and everyone mesmerized that wants it.

Speedway

Very well stated Speedway. I couldn't agree with you more.

[Little Woman]

Now that the car has become a collectible ... have any of you thought about what you might do with the car?? Keep it? Trade it in? Sell it?

I hope Cubby plans on keeping it. I love that car. He probably just won't drive it to work as much as he use to. That way he can keep the miles down on it. He's even talked about selling the one he has to get another one while he still can. We have a friend that wants Kevin's. Will see but we will keep have an XLR.

[galen]

I didn't buy the X to be an investment. Or any car for that matter. To me the X is something that very few people have. I like the looks and the uniqueness of the car. This news has no effect on how I feel about owning it.

[XLR-V Lover]

D. Caldwell is so full of BS I can smell him way down here in Florida!!!

If they handled the XLR very differently (and possibly priced both models more realistically) such as an ad or two here and there the car would have sold much better! If the XLR were pulling in sales numbers like the Vette that BS about a limited lifespan would never have been spoken about. Caddy would be lying around counting all their $$$$$$!!!

I hate when the "truth" is told with so many lies!!

I'll probably be keeping mine, as least for the time being.

Floyd (BB)