The Cadillac Escalade has long been one of the largest, most luxurious and biggest gas guzzling SUVs — in many ways, the antithesis of the environmental movement.
But no longer. General Motors on Wednesday unveiled plans to build an all-electric version with an eye-popping price tag of $130,000, making it one of the most expensive EVs on the market.
The EscaladeIQ is a crucial part of GM’s strategy to bring its Cadillac unit back to past glory with a goal of going all electric by 2030. Luxury shoppers are increasingly opting for EVs, and the automaker sees an opportunity to win back buyers who fled to foreign competitors and Tesla. Cadillac’s evolution begins with three electrified models built using its Ultium battery pack going on sale in the next 24 months.
“The market has never seen a vehicle like this,” GM President Mark Reuss said on Bloomberg TV. The current gas version of the Escalade has sold more than a million units, he said. “We’ll see what people are going to do.”
GM already has a Hummer electric pickup and SUV that sell for more than $100,000 to customers who want a large vehicle. Reuss said the EscaladeIQ will appeal to a different set of buyers because it’s more practical with a longer range of 450 miles.
When this new Escalade, which includes a 55-inch digital dashboard, hits dealerships next year, GM will have at least 11 electric vehicles in the US at starting price points ranging from the Chevrolet Equinox ($30,000) to the Hummer ($110,000) and Escalade at the high end. It’s all part of Chief Executive Officer Mary Barra’s push to electrify the company’s entire fleet by 2035.
Escalade has become Cadillac’s most profitable model and the crown jewel of GM’s luxury strategy since it debuted in 1998. Adding a successful EV to the brand will help give Barra’s goals more credibility. In a test of how much consumers want an electrified version, the EscaladeIQ will sell alongside the current gasoline-powered model, which starts at about $81,000.
Reuss said the EscaladeIQ will be profitable when it goes on sale, and that the company remains on track to have a profitable EV program in 2025.
As Cadillac goes electric, the brand may stop producing the gasoline version within the next few years, according Sam Fiorani, Vice President of Global Vehicle Forecasting at AutoForecast Solutions. The automaker might also have to lower the price below $100,000 to keep its share of the luxury SUV market, he said.
To make Barra’s ambition a reality, GM needs to boost production of its Ultium battery packs. But reaching consistent manufacturing volumes has been difficult. Other setbacks include software issues and delays on the Cadillac Lyriq crossover SUV and Hummer EV production being halted amid a recall.
The Ultium Cells LLC plant in Ohio is now at full production, which will enable GM to scale up EV volume, according to Reuss.
The electrification of Cadillac will also give GM the opportunity to improve its standing on combating climate change. Environmental activists have often targeted the unit’s vehicles for their high fuel consumption and emissions. The first Hummer got about 10 miles per gallon when it went into production in 2002. The current Escalade gets just 16 mpg.
GM expects to make about 150,000 EVs this year, almost a 300% jump from 2022. That will include roughly 80,000 Chevy Bolt compacts and 70,000 Ultium-powered vehicles, with more than half that production going to the Lyriq. The rest will be split between the Equinox, Chevrolet Blazer SUV and Silverado pickup, two Hummer models and BrightDrop delivery vans.