Cadillac did the impossible and reinvented its image in the 21st century, elevating itself from the quintessential producer of bench seat-wielding vehicular barges that were built for grandmas, to a producer of some of the best-driving and most exciting cars on the market. Naturally, bridging a gap as vast as that took some time and many new models that breached uncharted territory for the old wreath-and-crest, but through that Cadillac arguably made one of the most significant image shifts of any car company
in recent history.
The earliest examples of Cadillac's newly competitive cars were the 2004 CTS-V compact sports sedan, and the two-seat hardtop convertible grand tourer, the 2004 Cadillac XLR. Only one of those 2004 models really made a lasting mark on the automotive industry, and it wasn't the XLR.
The CTS-V lived on for two succeeding generations, and its torch is still carried over 20 years later by the CT4-V Blackwing, which is widely regarded as one of the finest driver's cars on sale today. Why didn't the XLR experience the same success? Several reasons actually, including its high price tag, lack of a manual transmission, its implementation of the now-dreaded Northstar engine, and its cheaper, better performing platform mate the Chevrolet Corvette.
Read more: These Are What You Wanted As First Cars (And What You Got Instead)
The XLR Was Meant To Compete With The Likes Of The Mercedes-Benz SL
Cadillac had its sights set on the best of the best with its reimagined 21st century strategy, and that meant releasing a sleek and desirable flagship model that could compete with the Mercedes-Benz SL, Jaguar XK, and Porsche 911. It was a competitive attempt on paper, but a few things held it back in the real world: its lack of pedigree, its high price, and its small trunk.
While producing a two-seat convertible flagship model sounds like a great idea, these cars do not sell in large numbers, and they are very expensive. Where its competitors like the Mercedes-Benz SL and Jaguar XK both had long and storied histories on American and international roads, the XLR was a newbie. Pedigree is important to the ultra-rich who buy cars like this and being that the XLR was based on the "every man's sports car," the Chevrolet Corvette, its pedigree paled in comparison to that of the highfalutin Mercedes-Benz or storied Jaguar.
In order to elevate the XLR above the Corvette, Cadillac swapped out the 'Vette's V8 for the most powerful version of the Northstar V8 ever, which produced 320 horsepower and 310 lb-ft of torque, about 30 horsepower less despite the Caddy's 400-pound heavier curb weight. It also fitted the XLR with skinnier runflat tires that offered a more luxurious driving experience since they weren't prone to tramlining or yanking the wheel around when traveling on rough pavement like the uncouth Corvette, but these tires stunted the XLR's performance abilities. Cadillac tried valiantly but couldn't quite elevate the XLR to the level of its admittedly brilliant segment competition.
All of its competitors offered more practical packages, too, some with rear seats, some with bigger trunks, and some at least had a bit of storage space behind their leather-lined seats. The XLR had minimal interior storage up front, no storage behind the seats, and a trunk that shrunk to a virtually useless 4 cubic feet of space when its top was retracted.
High Price And Middling Performance
The XLR's final year of production was in 2009, and its starting price was just over $87,000. Adjusted for inflation, that's almost $130,000 in 2025, and not a lot of people wanted to spend that kind of money on an impractical American two-seat luxury convertible when they could have a Mercedes, Porsche, or Jaguar for a slightly higher price.
The XLR-V was introduced in 2006 as the ultimate version of the XLR, with a supercharged version of the XLR's Northstar V8 that produced 443 horsepower and 413 lb-ft of torque. Its price was even higher, at about $100,000 in 2006 which is the equivalent of around $160,000 in 2025, and its competition was even stiffer. The SL 55 AMG, Jaguar XK R, and Porsche 911 were all exceptional and luxurious performance droptops, and again, at those prices people didn't want to end up saying "I own a Cadillac." It didn't have the same panache, and that's even more important to buyers as prices increase. It was still a softer version of the Corvette, so it was fitted with skinnier tires that compromised its roadholding and performance abilities, and it was saddled exclusively with an automatic transmission.
Its Segment Competitors Were Exceptional
The XLR-V placed dead last in a Car And Driver comparison test between it, the 2006 BMW 650i convertible, Jaguar XK convertible, Mercedes-Benz SL550, and Porsche 911 convertible. It ended up at the back of the pack due to its high price, tight interior, polarizing styling, and its lack of driver involvement. It was fast in a straight line with a 0-to-60 time of just 4.6 seconds, and it was lauded for being a comfortable daily driver, but buyers who shelled out extra money for the performance-oriented breed of luxury convertibles want their car to be, well, performance oriented.
The XLR faced an uphill battle at a time when Cadillac was just beginning to establish itself as a producer of truly competitive luxury vehicles that did more than float over bumps and offer acres of trunk space. It was more expensive and less engaging to drive than its Corvette cousin, it faced the fiercest of fierce competition from more established ultra-luxe brands, it was impractical, and overall, just missed the mark.
Legend has it that Cadillac dealerships had a nightmare of a time trying to find buyers for the XLRs on their sales lots, and over the course of the car's five-year sales run, it's believed that about 15,000 XLRs were sold.
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