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Cadillac to Take On 3-Series, C-Class and IS With its Own Small Car

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author photo by Autotrader November 2010

It’s official: Cadillac will soon build a smaller sedan, poised to take on the BMW 3-Series, Mercedes-Benz C-Class, and the Lexus IS. Although its name is yet unknown, the new small sedan will be built in Michigan, representing 600 new jobs and a $190 million investment from GM.

Though the name and timeframe are not yet official, rumors suggest the new sedan will likely be called the ATS, and unnamed industry sources quoted in Automotive News suggest that the new model is still around two years away.

In announcing the car, General Motors’ new chief executive Dan Akerson said it would be a “rear-wheel drive performance car,” with competitors such as the BMW 3-series and Mercedes-Benz C-class. Akerson couldn’t resist a jab at the small Mercedes, saying of the car that “they call it the C-class because it is very average.”

While the small Cadillac is still months away, word of the car is big news in Michigan, one of the states hit hardest by the economic recession. GM says that Cadillac will create jobs by adding a second shift to its Lansing plant, which is already producing the CTS and STS sedans. The car’s arrival is so important to the Great Lake State that Detroit’s mayor upstaged GM with his own press conference on Wednesday, touting the job creation and economic impact the car will have on the area.

“America’s fastest-growing luxury brand this year is about to get even more competitive with the addition of an all-new small luxury car,” said Akerson, in a statement. “This investment demonstrates GM’s commitment to Cadillac and a strong manufacturing base.”

Cadillac’s decision to build a smaller sedan rests on the brand’s goals of improving sales and market share. The 3-Series is BMW’s strongest seller, and while Cadillac’s sporty CTS had provided a formidable opponent for the small BMW, it’s closer in size to BMW’s larger 5-Series.

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Cadillac to Take On 3-Series, C-Class and IS With its Own Small Car - Autotrader