I don't necessarily see this as a bad market move for GM. Right now, Cadillac is nothing but a niche brand. The luxury car market is all but dead in the US already. The remaining players, MB, Lexus, etc. continue to dominate what is left of the traditional luxury car market. For good or bad, many of those that may be looking for a luxury ride recently have already moved on to Tesla as the latest status symbol.
Other than the luxury SUV's, Cadillac simply has nothing left to offer. And, I would think that their sales can't possibly be enough to maintain that division long term. By placing the bet on the EV market through Cadillac, they can attempt to directly compete with Tesla, possibly with a much better, already established distribution and dealer network.