In my teens I actually ran CP/M on my C128 which could also be a C64(this mostly for games)
It just didn't sell well for Commodore compared to the Commodore 64 and the Amiga. As a replacement for the Commodore 64, it was a sales disappointment. Most other manufacturers would have been thrilled with a failure like that, however.
That said, perhaps more accurate would be to say that using CP/M to position the C128 that was didn't help much - even of the people who bought a C128, most never used CP/M. Though to some it might have been what allowed them to convince parents it was a "serious computer".