A look at the sales data tells Cadillac executives all they need to know. Mercedes-Benz and BMW are pounding General Motors’ luxury division in its own backyard, leaving new boss Johan de Nysschen with an enormous challenge ahead of him. In an interview at the Paris Motor Show, de Nysschen told Reuters where he sees Cadillac headed in the next decade and how a new roster of automobiles in the coming years will help move the slumping company forward.
German rivals advancing
Mercedes has increased sales 9 percent in 2014 (compared to 2013) and now has double Cadillac’s market share in the United States. BMW (also up 9 percent in 2014) has sold over 100,000 cars more than the GM luxury division on the year. Even Audi (up 15 percent in 2014) is outselling the cars on U.S. Caddy dealer lots. Cadillac is down 4 percent in 2014.
To reverse this course, de Nysschen must change perception of his brand, which was left out of the top 100 global brands in a recent study by Interbrand. Mercedes (10th) and BMW (11th) had no such problems. U.S. luxury auto consumers are clearly responding to this image, which may have as much to do with the cars on dealer lots as the brand’s marketing direction.
New line of Cadillacs
A quick comparison between Cadillac and its luxury German competitors reveals a wide product gap. Mercedes and BMW both offer entry-level sedans, winning crossovers, and range-topping luxury land cruisers built to satisfy the demands of one (high-margin) consumer segment. De Nysschen sees Cadillac’s prospects tied to its next wave of automobiles, including a crossover, an all-electric vehicle, and a high-end flagship vehicle that could compete with the Mercedes-Benz S Class.
De Nysschen told Reuters he “signed off on” a range-topping luxury vehicle (expected to be called the CT8 or CT9) that will appear before 2020. Since the Cadillac Elmiraj appeared in concept form at Pebble Beach, many industry figures have suggested that is exactly what Cadillac needs. Maybe one is finally in the works, though it won’t have the dreamy name of the concept. The automaker’s new boss also said more crossovers are on the way, along with an electric vehicle that will be run on battery power alone, and hopefully make the ELR a distant memory.
New headquarters, new energy
Word that Cadillac was moving to New York’s SoHo neighborhood raised many eyebrows, but separating from GM’s Detroit base should be a step in the right direction. Cadillac’s well-reviewed vehicle line has no problem wowing drivers and winning awards, but the brand’s stodgy image — not to mention its average customer age of 59 — needs a lot of reworking. SoHo may not be Brooklyn’s Greenpoint on the hip scale, but it certainly tops Detroit on energy and trendiness.
To compete with the German luxury kings, Cadillac will have to deliver a sexier next generation of automobiles and think younger in every aspect of the design and marketing process. De Nysschen expects that to take at least 10 years. By that time, the brand will likely have an entirely new roster of vehicles. According to de Nysschen, “90 percent of Cadillacs sold in 2020″ are still in the design stage, Reuters reports.
In the meantime, as many as six new vehicles may hit the market. There is definitely change in the air at Cadillac. It is time to see whether the brand can execute on the plans of its ambitious new boss.