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Despite the unprecedented COVID-19 epidemic in 2020, which has had a great impact on the domestic passenger car market, luxury brands still maintain a high growth trend, whether first-tier or second-tier luxury brands have repeatedly reached new highs. Among them, Lexus has been ahead of Cadillac for many months since 2020, but Cadillac set an all-time record in the last month.

According to the latest official Cadillac results, Cadillac sales reached 27524 in December 2020, a year-on-year increase of 55.9%, a result that Cadillac has continued to soar since the second half of the year. As a result, the brand's cumulative sales for the whole year increased by 8.2% to 230007 vehicles compared with the same period last year, setting a new record for 17 years of sales in China.

Although the Lexus brand has not yet released the latest sales data, Lexus has remained the number one second-tier luxury this year through a relatively high growth rate since 2020 and continued until November last year.

It is worth noting that the dispute over the first name of second-tier luxury is still in suspense. Judging from the monthly sales results of both sides, Cadillac has soared continuously since the second half of the year, so that Lexus has not been able to surpass Cadillac in a single month since July this year, which makes Cadillac's sales gradually catch up with Lexus.

According to the specific sales figures for both sides in November, Cadillac reached 24307, while Lexus reached 20632, far exceeding Cadillac's sales of just 4000. The gap between the two brands is less than 200. So the best result from Lexus last year was only 23600 vehicles. To surpass Cadillac this year, we will undoubtedly have to sell 27000 vehicles in the last month, but this is undoubtedly a challenge for Lexus.

It is well known that Cadillac's chance to return to the annual championship has something to do with its continuous "price for volume" marketing strategy, which has always been one of the ways for the brand to achieve sales growth.

At the same time, with the in-depth adjustment and upgrading of Cadillac in the product line last year, the brand product line has been further improved and the market positioning has become clearer, thus helping to increase brand sales. At present, Cadillac has completed a strong product matrix of domestic "3x3", with a lineup of three luxury cars composed of brand-new CT4, CT5 and CT6, and three luxury SUV lineup composed of XT4, XT5 and XT6.

Now it seems that the sharp price reduction competition has indeed given Cadillac a short-term benefit, with sales growing rapidly and standing firm. However, this can easily lead to a serious decline in brand premium, product market price confusion, low second-hand salvage value, and brand loyalty. Especially with the market returning to rationality, this phenomenon is particularly obvious. This is also where Cadillac is widely criticized by consumers and netizens.

On the contrary, when the price of the luxury car market continues to decline, and the terminal profit discount has become the norm, Lexus is doing the opposite. The terminal discount is relatively small, and some hot-selling models even have the phenomenon of price increase. After all, there are not many brands selling cars with price increases these days.

Some industry insiders pointed out that Lexus can maintain positive growth, on the one hand, through order sales, can effectively control prices and orders, on the other hand, the production capacity released by Japanese factories during the epidemic has been transferred to support the Chinese market, and the best-selling models ES, RX, and the upcoming replacement of NX have all had good positive growth.

In addition to Cadillac, which has announced sales results, Volvo, as a second-tier luxury competitor, and the domestic independent "proud" Red Flag brand have announced the latest results. Among them, the Red Flag brand achieved a year-on-year increase of more than 100% in sales of 200000 vehicles for the first time, successfully crowding out Volvo to become the "new top three" of second-tier luxury brands.

According to Volvo's Chinese market sales in 2020. In 2020, Volvo's Chinese mainland market sold a total of 166300 vehicles, up 7.6 percent from the same period last year, including 18547 in December. The growth rate of Volvo, the FAW Red Flag brand, is really a bit slow.

In any case, in this difficult year last year, luxury brands have become the most eye-catching area in the passenger car market with the trend of rapid growth in the context of the upgrading and transformation of domestic consumption. It is reported that GM will promote electrification as the biggest strategy in the next few years, so that the market pattern is full of variables. Will Cadillac be happy or worried?

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