The Great Cadillac ELR and GM's Dilemna

Cadillac ELR plug-in hybrid at NAIAS

Along with the new Corvette, the Cadillac ELR was one of the most eagerly awaited cars at the Detroit motor show this year. But while there have been six generations of Corvette before, there has never truly been a green Cadillac. Yes, the brand which has been best known for its land yachts is now making plug-in hybrids.

It's a great moment and from what we know, a great car as well. The ELR is a Chevrolet Volt on steroids redesigned by a plastic surgeon who could make a fortune in Hollywood. Everything good in the Volt has been made better, while things less good have been rendered less important. Only two people can sit in the back of a Volt and its trunk is smallish, but this ELR is a two-door so nobody will complain here. The better is more performance, with smart engineering because the hardware is the same as the Volt.

The only real difference is in the software. The electronics pump out more juice from the battery, translating into more power sent to the wheels. GM has not revealed any official data yet but the rumor is that it has shaved one second in the 0 to 60 mph exercise. Pretty good considering the Volt is no slouch.

There's a downside though. The extra power and extra weight due to all of the luxurious appointments and equipments have slightly reduced the ELR's range in electric mode. It's down to 35 from 38 miles.

Cadillac ELR plug-in hybrid at NAIAS

Thankfully, this is a car that could sell on looks alone. The Tesla Model S sure looks fine, but it looks like several other cars whereas this design is truly unique and distinctive—it stands out everywhere. The two-door CTS was nice but this ELR is even better. As a green-minded European, I may add that this is the first Cadillac ever I would be happy to own and drive everyday (OK, I have said once that I wanted a '59 Eldorado, but I was drunk).

In Europe, this Cadillac ELR may even sell better than the Volt, because Chevrolet is seen as a value brand on this side of the Atlantic. It's quite successful with little Korean imports like the Spark or the Sonic, but everything above the Cruze is a hard sell. With an upmarket badge, the ELR may have more of a chance, though sales shall remain marginal. It's the American market that matters here, and that is where GM's plug-in hybrid technology will face its ultimate test.

Cadillac ELR plug-in hybrid at NAIAS

The Chevrolet Volt has sold poorly so far. By this I don't just mean that sales were below expectations (though they were,) I mean the transaction prices have been very low. The Volt's $39,145 MSRP is for little old ladies. Most cars were leased under very customer-friendly conditions. It is possible to lease a Chevrolet Volt for less money than a Lexus with a similar price.

Cadillac has yet to give any information regarding pricing on the ELR, but the brand has a tough question to answer. How much more will customers be willing to pay for the ELR compared to a Volt? What are a sharper design and a luxurious interior worth?

On the one hand, Volt owners may hope that the ELR is expensive. They will think they had a great deal with their car. A high price for the ELR may even help make the Volt more desirable. But on the other hand, I hope that the ELR will be successful in the marketplace (so that I can soon afford a used one,) and that will require more aggressive pricing and lease terms.