Howes: Cadillac faces decade rebuild
What does Johan de Nysschen know that others don't?
"You're participating in history," Cadillac's global brand chief said at this week's Los Angeles Auto Show, evidently unaware that the motoring press has been "participating" in Cadillac's new history going on a generation.
That would be 20 years hyping products that tended to under-deliver in terms of sales volume; of efforts to make coastal luxury buyers, not homers in the heartland, Cadillac customers at the expense of its foreign rivals; of Super Bowl ads and Le Mans racing gambits that mostly failed to push the brand into overdrive.
Now we have yet more hyperventilating in LA alongside plans to move the brand's headquarters and 140 of its employees to SoHo in New York. Both, presumably, are the better to woo too-cool coastal types from their Audis, BMWs and Jags and into Detroit metal (without saying so).
How? With new alpha-numeric names for an expanded range of sedans and SUVs? With an energized V-line of lithe Cadillac muscle? With ad campaigns that subtly cleave the new Cadillac from its American — and, dare I say it, Michigan — heritage?
All of that, and more. GM's luxury brand and its sprawling network of dealers also will have to emulate the competition in a more challenging way: by weaning themselves further from the tendency to move metal with discounts, employee pricing and subsidized leases.
If today's and tomorrow's Cadillacs are as world class as the engineers and critics say they are and will be, the marketing savants destined for Cadillac's SoHo digs need to spend more time selling the car and SUVs — and less time selling the deals.
That'll require a split corporate personality for a company like GM, whose roots remain deeply embedded in the volume car business. That's not a legacy shared by BMW or Mercedes, if more so by Audi's historic ties to Volkswagen AG.
GM has the engineering prowess and development chops to compete with the best in the world; it already does, from full-size pickups to the iconic Corvette and its performance permutations. Getting an entire brand to that level, and keeping it there with a bigger and richer customer base, is at least a decade-long game requiring a kind of discipline rarely evinced by GM.
"We have a long way to go," General Motors Co. CEO Mary Barra recently told The Detroit News, eschewing the bravado of her predecessors. "Cadillac is an iconic brand. We believe it's something to invest in. We have a plan and we're going to execute it."
She also acknowledges, in concessions to reality, that Cadillac customers "still may have to explain" their choice over, say, an Audi or a BMW. And, second, that would-be customers don't "care where our work is done. They care that we do good work."
Amen to that, even if it implicitly contradicts the Cadillac-to-NYC meme. The growing evidence is that Cadillac is delivering some of the best work in decades. Its ATS and CTS sedans, to name two models, are credible German-fighters that nonetheless are struggling to find as many buyers as hoped.
Barra says Cadillac's brand needs strengthening and definition. The iterative process, nearly perfected by the Germans in Munich, Stuttgart and Ingolstadt, cannot easily withstand the corporate whim or strategic rethinks marking Cadillac's past dozen years, saddling it with a product portfolio that looks thin next to the strongest German competitors.
Cadillac's SUV range is limited. Its SRX occupies a credible place among smaller crossovers, but GM's global luxury brand has no answer (now, anyway) for the BMW X5, Audi Q5 or Mercedes-Benz M-Class, the Teutonic triumvirate of continental SUVs delivered largely from the American South.
The Escalade full-size, a prodigious profit center for Cadillac and its parent, remains in a super-sized class by itself. Given the steady march of tougher federal fuel economy regs, it's more likely to stay there than foreign rivals are to flood the shrinking segment.
And what about global cred? How can the distillation of GM's excellence be considered a credible world-class alternative to the German protectors of the luxury club if it doesn't offer diesel engines for diesel-heavy markets or aim to challenge the euro Big Three in their backyard, a play GM's previously made to generally bad results?
"Today the products are really good," says Warren Browne, a retired GM-Europe executive who now heads his own consulting firm. "They need to produce a model in Europe and take the building of the distribution in Europe as a 10-year journey, not the latest GM marketing program. European intenders in America pay attention to Europe; they don't care about Cadillac performance in China."
Even if the CEO does — which get us back to De Nysschen, Cadillac's new global boss. He ran Infinity from Hong Kong and Audi in the United States, overseeing its headquarters move to suburban Washington from Auburn Hills (sensing a pattern?).
He's a successful product of "The Club," meaning he should know better than anyone atop Cadillac in a long time what it takes to succeed — and whether GM's jewel can again be a winner.
Daniel Howes' column runs Tuesdays, Thursdays and Fridays and can be found at detroitnews.com/staff/27151.