The new CTS is longer and lower than its predecessor to give it a more athletic profile and improved handling.
GM is expanding the powertrain lineup to three engines, from two, including a new twin turbo 3.6-liter V-6 that will be offered in a new CTS performance model. It's billed as GM's most powerful V-6 engine ever.
The performance emphasis follows the playbook Cadillac used for the ATS compact, which has won critical praise since its launch last summer. The CTS rides on the same rear-wheel-drive platform that GM built from scratch for the ATS.
For the design, Cadillac kept the bold angles and sharp edges that mark its so-called art and science theme, a design language that debuted on the first CTS in 2002. But the sheet metal features more creases and subtle surfacing, meant to give the sedan a more sophisticated look.
Bob Ferguson, vice president of global Cadillac, calls CTS "the centerpiece" of the brand's lineup and believes the combination of performance and expressive styling can lure customers from German luxury brands.
"With Cadillac growing globally, driven by rising product credibility, the new CTS elevates the brand to a new level," Ferguson said in a statement.
GM will begin production of the 2014 CTS this fall at its Lansing Grand River plant in Michigan.
Pricing will be announced later. The price is expected to rise considerably from $39,990, including shipping, for the base 2013 CTS, partly because of added content and because the CTS no longer will need to be Cadillac's high-volume car, a role that the ATS likely will assume.
Cadillac marketing chief Don Butler says the new CTS will be priced "in the same ballpark" with rival cars such as the 5 series, which has a base sticker of $48,695, including shipping.
"Given all of the significant advantages that this vehicle will have over a 5 series, for instance, I'd be remiss to come in and say, 'Here's a bargain-based price,'" Butler says.
A strong reception for the redesigned CTS could help Cadillac hit its lofty U.S. retail sales target of 190,000 units for this year, which would be a 35 percent rise from 2012 retail volume. Cadillac executives disclosed the goal to dealers at a national meeting in early February, according to dealers who attended.
'Quantum leaps' in sales
"If we're going to make this brand what it needs to be for GM, we've got to take quantum leaps in terms of where we are from a sales standpoint, from a brand-positioning standpoint," Butler told reporters this month.
Butler says he expects CTS volumes to grow this year even with the addition of the ATS to the lineup. CTS volumes have slumped since the August launch of the ATS amid some cross-shopping between the nameplates.
Research firm IHS Automotive expects sales of the CTS sedan to be around the same as last year, 33,536 units, with about 20 percent of the volume coming from the 2014 model once it hits showrooms in the fourth quarter. It expects the sedan's sales to dip to about 32,000 in 2014 and rise to 34,000 in 2015. All CTS sales, including the coupe and wagon versions, fell 15 percent in 2012 to 46,979.
No longer a 'tweener'
Since its introduction 11 years ago, the CTS has been what GM executives call a "tweener" car: slightly bigger than a compact, but smaller than competing mid-sized sedans. That was because, until last year, Cadillac lacked a small car. So the CTS filled two roles.
That changes with the 2014 CTS, which is about 5 inches longer than the outgoing CTS and about 1.5 inches wider. Its dimensions line up almost identically with the 5 series and E class, which Cadillac execs say will give buyers an apples-to-apples choice when sizing up the CTS against mid-sized luxury competitors.
The longer profile, raked windshield and a stretched C pillar give the car a leaner profile. A slightly longer wheelbase results in a more spacious rear seat.
The front end features a wider, more prominent grille than the current CTS, framed by polished aluminum. The car has the vertical, bladelike LED headlights and taillights that have become a signature Cadillac styling cue.