CADILLAC’S LYRIQ IS BECOMING A DARK HORSE IN THE US ELECTRIC CAR WARS

(Bloomberg) -- For a guy with a dog named Elvis, buying a Cadillac is fairly on-brand. But for Gary Roberts, a retired dentist who lives just west of Asheville, North Carolina, buying a Cadillac Lyriq also meant deciding to invest in his first electric car.

Roberts isn’t a brand loyalist, or even much of an environmentalist, but there was something about the Lyriq that appealed to him.

“We were just looking to try something different,” he says. “I don’t like the way the Teslas look and this looks way better than the BMWs and Audis and even the Mercedes.” (Elvis, a poodle/Bernese mountain dog mix, also likes the Lyriq, though the Roberts’ Escalade gives him a little more room on road trips.)

Roberts isn’t the only US car buyer convinced by the Lyriq’s look and feel: Even as the shine wears off much of the EV market, Cadillac’s Lyriq has emerged as a rising star. General Motors Co. sold almost 6,000 of them in the first quarter, besting nearly all of its German luxury rivals and a number of more pedestrian battery-powered models, according to new data from Cox Automotive.

The Lyriq has a full suite of luxury gewgaws, including a state-of-the-art self-driving system, speakers in the headrests and a choose-your-own-ambient-light adventure. But it doesn’t look like other contemporary SUVs. As German luxury brands aesthetically evolve toward 6,000-pound eggs, Cadillac’s fighter is sleeker. It has a raked roofline and extended hatchback, almost aping the high-performance station wagons its Stuttgart challengers used to excel at. The Lyriq also offers a robust 314 miles per charge and starts at $58,600, almost one-third less than BMW’s seminal e-SUV, the iX.

“There’s a lot there,” says Cadillac Vice President John Roth. “It’s hitting the sweet spot of the market … and we’re just super excited with that momentum.”

GM has now sold about 15,000 Lyriqs in the US. Roth says 70% went to people who weren’t previously driving a GM car or truck and 15% were sold to consumers who most recently drove a rival luxury brand. (In Detroit speak, these are known as “conquests.”)

The Lyriq also benefits from being situated in one of the US EV market’s few bright spots. Luxury models sold at a brisk pace in the first quarter: 58,100, compared to 37,300 in the year-earlier period. The category now accounts for nearly 25% of EV purchases across the country, up from 14% a year ago.

While affordability remains one of the major roadblocks to EV adoption, luxury cars are aimed at more affluent buyers, who are often adding them to their garage inventory versus replacing a vehicle, according to Edmunds analyst Jessica Caldwell. Electric SUVs in particular have gathered sales speed.

“If you think about it, the luxury SUV category doesn’t really have an excuse to suffer,” Caldwell says. “They’re not really waiting for that mass market to jump on.”

Smaller and more modest electric models, on the other hand, are struggling to maintain momentum. Americans bought 269,000 EVs in the first quarter, according to Cox, a 2.6% increase over the year-earlier quarter but a 15.2% drop from the last three months of 2023.

Much of that swoon can be tied to a 13% slump in Tesla sales. The carmaker still controls about half of the US EV market, but competition is picking up and at least some would-be buyers have grown tired of Tesla boss Elon Musk. Meanwhile, Cox analyst Stephanie Valdez Streaty notes that the company’s products seem to be getting a little stale. “Those models have been around for awhile,” she says. “Consumers like new — new models, new stuff.”

Still, Streaty expects electric car sales to get a second wind from Tesla’s price cuts. Many brands have followed the carmaker’s lead, bringing the average price of an EV in the US down to $55,200 in the first quarter, a 9% decline over the first quarter of 2023.

“That’s important, because if you think an EV is not even in your realm of possibility, you’re not even going to do the research to see what’s out there,” Caldwell says. By year-end, Cox expects one in 10 new cars bought in the US to be battery-powered.

The Lyriq, a full-fledged luxury vehicle, is hitting the market only slightly above the average US EV price. But getting to this point has been a bumpy road for GM. When the model was unveiled in August 2020, more than 200,000 people expressed interest. But production delays slowed deliveries to a trickle and at least some customers canceled their orders. Now, however, the factory in Spring Hill, Tennessee, is humming.

Cadillac’s Roth sees the first-quarter sales as a vote of confidence in the Lyriq, not an anomaly or a reflection of pent-up demand. “A lot of these brands just aren’t hitting the range-value equation,” he says. “And beauty, well, that’s in the eye of the beholder, but I’ll let the market decide what looks good.”

Roberts in North Carolina had to wait 10 months for his Lyriq. But when his number came up, he eagerly traded in his GMC Acadia Denali, which got only 19 miles per gallon when puttering around town. “[There are] enough vehicles out there,” he says. “You don’t have to drive something you don’t like.”