According to Bloomberg, GM is rolling out discounts as high as $10,000 off a new Escalade. That’s for a new lease. If you’re thinking about buying instead, you could still save $7,500 off the purchase price. That is, if you get your order in before the end of May.
How can Cadillac afford such huge discounts, you wonder? Because the profit margin on Escalades is that large. As high as $20,000 per vehicle, according to some estimates. Cadillac’s full-size SUV starts at around $75,000. The Chevy Tahoe or GMC Yukon, which share more than common underpinnings with the Escalade, start at under $50k. Even the luxed-up Yukon Denali starts at $66,200.
The big Lincoln poses a big threat to that nice, fat profit margin. Bloomberg reports that Navigator deliveries have grown by 63 percent over last year. You can bet that a large portion of those buyers have migrated from the Escalade. And the Navigators are flying off dealer lots.
A new Navigator sits an average of just 10 days on a dealer’s lot before it’s sold. And the top Black Label model, which can top six figures, is typically snapped up in about a week. Most the Navigators and Escalades typically sell for over $80,000, which is over $25,000 more than Navigators were selling for last year.
Back in November, Cadillac was offering owners a $5,000 incentive to trade in any Lincoln built since 1999 for a new Escalade. At this rate, you can bet there’ll be more incentives to follow.