Why GM avoided Chevy and Cadillac for its new hero

The GMC Yukon is headed to Australian showrooms soon

How many brands is enough? For General Motors Australia it seems the answer is ‘as many as you need.’

Which explains, in part, why the operation has decided to introduce two new brands in 2024 – Cadillac and GMC. And while the addition of the former makes sense, to tap into Australia’s luxury and electric vehicle markets, introducing the latter needs further explanation. After all, the GMC Yukon is based on the same underpinnings as the Chevrolet Tahoe, so why not just introduce the new model with the already-established ‘bowtie’ brand?

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GM Australia and New Zealand chief, Jess Bala, has a clear explanation for precisely why they chose to introduce GMC. It comes down to two key reasons – price and positioning for each brand.

“Yeah, we looked at [the Tahoe], we looked at the content also involved and where obviously it’s going to be priced, which we’ll share with you all pretty soon,” Bala told Torquecafe. “But when you look at the sort of the layout of the truck, if you compare it to the Silverado and the screen that’s in that, it’s more of the landscape version. When you jump in this car, you’ll see it’s the big portrait in the middle, it’s got the rear seat infotainment, so it’s really more of that higher tech. It’s more family orientated, a little bit more of a luxurious play that we just felt was the right positioning for a car like that, with where we want to put it in the market.

“When you look at the competition and what’s already out there, that has a bit more uniqueness about it. And just allows us another level of brand differentiation. You know, we’ve become, GMSV has become a very specialist niche umbrella brand in itself, that offers very niche vehicles for different capabilities, different needs, different wants. And that’s why we felt that the Yukon was a better fit for us than, say, the Tahoe as the Chevy equivalent.”

Put simply, offering a large, US-style SUV that needs to be converted to right-hand drive will naturally mean a higher asking price, so it makes sense to offer a more premium brand than Chevrolet. GMC sits in between Chevy and Cadillac in the US market, so it proved to be the ideal candidate.

However, it does mean introducing a new brand to Australian car buyers and that will be no simple task, but Bala is confident the Yukon won’t be too difficult to pitch to the local audience.

“No, I mean, we’ve done some early research around familiarity and awareness of GMC, and it is on the lower end for obvious reasons,” she said. “But we do know that people recognize that style of car, right? They’ve seen it in a lot of TV, movies, things like that. So we do have a job of work to do for the GMC brand itself, and we’ve already got plans in place for that. You’ll start seeing some of that very soon. So we do have some brand awareness we need to do as well as you’ve got nameplate awareness building that we need to do as well.“

Although it does lead to the final question – why not just introduce it as the Cadillac Escalade? That would resolve both the issues around price and brand awareness. The reason not to is very simple according to Bala.

“Cadillac is intended to be EV only,” she said. “And obviously again, a very different price point. So as you know, Cadillac is going direct-to-consumer only, not through GMSV. So again, it was more around the price point we wanted to go after, obviously our volume aspirations, what’s already in the market and what we could compete with.

“And that’s why we felt Yukon Denali was the best fit for us. So obviously, if you look at the US Yukon has several other trim levels below this one that we’ve got come in. This is the second top. And again, we wanted to go after more of that luxurious capability, more tech, more features, higher end features that go with where we think we can position the car.”

As we’ve previously reported, GM Australia hasn’t completely ruled out introducing the Escalade IQ, which uses the Ultium all-electric powertrain, but doesn’t want to confirm any future models until it has launched the Lyriq locally.