While the first-generation Seville had proved quite successful, it failed in its primary mission of winning over younger import buyers. Marketing research indicated that the car was most popular with older women who wanted a Cadillac in a smaller, more maneuverable size. For the 1980 model year, the Seville's K-body platform became front-wheel drive, based on the E-body of the Eldorado, Buick Riviera and Oldsmobile Toronado. Length and wheelbase were similar, with the car losing .3" in wheelbase and gaining .8" overall. The new model featured independent rear suspension and was the first American car to have a standard diesel engine, which had carried over from the previous generation. Cadillac's new 368 cu in L62 V8 with Digital Fuel Injection was a no-cost option except in California, where the fuel-injected Oldsmobile 350 remained available, also as a no-cost option.
The razor-edged bustle-back rear styling drew inspiration from English coachbuilder's Hooper & Co. "Empress Line" designs from the early 1950s; themselves a dramatic, modernized take on the mid-'30s style of trunk/body integration. In addition, long hood/short deck proportions were in the later half of a revival that had manifested on large, exclusive luxury cars from the 1960s onwards, as in halo personal luxury cars such as the Buick Riviera, Oldsmobile Toronado, and reconfigured Cadillac Eldorado. The Seville's "statement" styling was one of the last vehicles designed by GM's Bill Mitchell, appointed by Harley Earl in 1936 as the Chief Designer in the then newly created Cadillac design studio, was swiftly imitated by the 1982–1987 Lincoln Continental sedan, and the 1981–1983 Imperial coupe.
The Seville initiated features that would become more traditional in later years. In 1981, "memory seats" — a feature not seen on a Cadillac since the Eldorado Broughams of the late 1950s — became available again. This option allowed two memorized positions to be recalled at the touch of a button. Also new for 1981 was a digital instrument cluster. The "Cadillac Trip Computer" was a precursor to this option in 1978. For the 1981–1985 Seville and Eldorado, it was considerably less expensive at US$200 in 1981 and did not contain the many features of Trip Computer, just a digital speedometer and fuel gauge. Engine options changed for 1981; the Cadillac V8 was now equipped with the V8-6-4 variable displacement technology. However, the engine management systems of the time proved too slow to run the system reliably. A 4.1 L (252 cu in) Buick V6 was added as a credit option. "Puncture-sealing" tires were also new for 1981.
In 1982, Seville offered heated outside rear-view mirrors with the rear defogger option. Inside, a "Symphony Sound" stereo cassette tape system was available. The previously standard diesel engine became an option, as Cadillac's new 4.1 L (250 cu in) HT-4100 was introduced. This engine, especially in its early years, had a number of reliability issues, such as weak, porous aluminum block castings and failure-prone intake manifold gaskets. For 1983, the Buick V6 was dropped and a new "Delco/Bose" stereo cassette system was offered at US$895. Initially, looking like a standard Delco radio in 1983, from 1984 on it featured a brushed gold-look front panel and bulbous lower interior door speaker assemblies. This was also the last year for the availability of an 8-track stereo system for Seville. On the outside, from 1983 through 1985, Seville was available with a "Full Cabriolet Roof" option, which gave Seville the look of a four-door convertible.
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