Cadillac Bet Big On EVs. It’s Paying Off

• Cadillac was the number one brand for luxury EVs last quarter in the U.S.
• The company has launched a full lineup of electric vehicles, ranging from a compact crossover all the way up to a $300,000 flagship.
• Cadillac says it’s stealing buyers from other luxury marques with its compelling EVs. The next challenge is to do so profitably. 

Cadillac has bet big on electric vehicles. Between the Optiq, Lyriq, Vistiq, Escalade IQ and Celestiq, the company has launched a full-on salvo of EVs over the past couple of years.

The brand’s goal was to become a leader in EV sales, and, according to Cadillac Vice President John Roth, it’s already done so. Cadillac was the best-selling luxury EV brand in the country last quarter.

That’s a big deal both for Cadillac and the EV landscape. For Cadillac, it’s a much-needed reset after a decades-long identity crisis. The company’s name was more associated with its past glory days than its current products, which have long struggled to capture consumers’ imagination (except the Escalade). But it has now delivered a full slate of compelling, stylish EVs packed with technology.

In other words, the brand’s executives say, Cadillac is finally winning again. 

The Celestiq is Cadillac’s $300,000+ hand-built electric flagship. it’s supposed to showcase just how far the brand’s technology and design have come, and deliveries to customers have begun.

Photo by: Cadillac

It’s also a big deal for the EV revolution in general, because it shows what sort of opportunity there is for companies that take the transition seriously. Your prior beliefs about who makes the best cars aren’t going to transfer directly to the EV world, because different players are putting in different amounts of effort.

While Lexus had hybrids on the market 20 years ago, and a brand built on efficiency, its EV sales are a drop in the bucket compared to Cadillac’s. That’s because Cadillac is offering plenty of options with new designs, new software tailored specifically to the needs of EVs and competitive leasing offers. Lexus offers one EV, and it feels rather half-baked, although a significantly upgraded version of it is coming soon.

The result has been an astounding win for Cadillac: The company is poaching tons of buyers from other brands. Conquest rates for the Lyriq and Optiq are 79% and 76%, respectively, meaning over three-quarters of all buyers are new to Cadillac. Asked in a media roundtable where those buyers were coming from, Roth listed some big names:

“Tesla, Mercedes, Audi, Lexus,” Roth said. “Yeah, all the big luxury tier one buyers are coming our way and we’re super happy about that. We’re giving them a great vehicle and a great experience with great range, great technology, great customer experience, and a great dealer network to service them.”

The 2025 Cadillac Optiq is the brand’s new compact EV crossover, with standard Super Cruise and 300 miles of range.

Photo by: Cadillac

The company has invested a lot of money into training dealers to sell EVs, something too many brands overlook. The conquest rate is also proof that EV shoppers are out there, Roth says, and that even without tax credits, there are going to be plenty of buyers who want an EV over a gas car.

These buyers are also younger on average: 47 or 48 years old for the Escalade IQ and Vistiq, he said, far below the average for the luxury market overall, where the average buyer is in their mid-50s.

One Big Hurdle Remains: Profit

That’s all lovely news for Cadillac. Roth paints a picture of an American icon back on the up-and-up, with its best-ever slate of both gas and electric options. To be sure, the brand’s full-court press in the EV market appears to be producing sales.

But Cadillac has the same problem as many legacy brands. It’s hard for them to sell EVs profitably. While Roth projected confidence that Cadillac was on its way there, he stopped short of making any predictions about when the EV lineup would be profitable. 

As the tax credit goes away and tariffs drive up the price of steel, aluminum and auto parts, that issue will become more pressing. Most automakers are still losing money on many EV sales, even with tax credits, and experts say the loss of it will make the situation worse.

General Motors has scaled up its EV business more than any other American automaker, and has claimed its EVs are “variable profit positive,” but that’s a non-standard framing that factors in the benefits of not having to buy regulatory credits, among other things.

Still, Roth suggested that Cadillac was in a better position than most to manage the changing EV market.

“There are EV buyers in the marketplace, regardless of what programs are out there from a governmental standpoint, and we have an opportunity to showcase the best catalogs, and we’re bringing those customers into the brand. I don’t see that stopping. I see that again as an advantageous opportunity, especially for Cadillac being one of the most American-manufactured vehicles,” he said, referring to his claim that Cadillac offers more U.S.-built nameplates than any other luxury brand.

It’s fair enough to claim that Cadillac is better-positioned than rivals like Audi, which import all of their cars from other countries. But products becoming $7,500 more expensive is rarely good news for the business. That speaks to a weirder trend in the business overall, where some brands are better equipped to handle things, but still face a painful short-term outcome as they adjust their businesses to new tariffs and the loss of the tax credit.

It won’t be easy. But neither was reviving Cadillac, and General Motors seems to have pulled that off. The question now is if the company can keep its momentum as the EV market matures.

Contact the author: Mack.Hogan@insideevs.com.