If it wasn’t apparent from the new ATS and all-new 2014 CTS, General Motors is very serious about Cadillac. GM Chief Financial Officer Dan Ammann shared the automaker’s sentiment about the global luxury brand in a recent interview, stating:
“Cadillac is a critically-important part of the GM story. We’ve been investing significantly from a product point of view in the Cadillac portfolio, you’ve seen evidence of that in the marketplace with the launches — ATS, XTS, new CTS coming, and the whole portfolio, across cars, crossovers, and to the truck portfolio — so, Cadillac — incredibly important both here in the U.S., North America, around the world, it’s gonna be an important part of the growth equation for us, and something we’re putting a lot of resources into.”
In discussing how GM sees Cadillac’s growth strategy compared to those of its most direct rivals, Mr. Ammann added the following:
“We’re not after volume at all costs, we’re after building the brand, we have a lot of opportunity to grow the business from a volume point of view, but it’s not a purely volume-driven strategy, we have to grow the business a very orderly and profitable way. We pay close attention to what all of our competitors are doing, we make sure we understand what’s going on in their businesses, but we have our plans and our strategies, and we’re executing to those while taking into account the competitive dynamics in the marketplace.”
The GM Authority Take
Cadillac’s importance to The General from a competitive perspective revolves around profitability, a metric by which The General currently lags its closest competitors such as the VW Group and Toyota. Clearly, higher profitability furnishes GM with the proper financial resources to spend on making better products — in turn making it even more competitive. Currently, the brand has tremendous growth opportunities in markets outside of North America, namely China and Europe.
And while it may not be “volume at all costs” for Caddy, overall sales volume is still a vital factor when it comes to the long-term longevity of the brand, and the quality of its products. It seems that what Mr. Ammann is suggesting here is that GM isn’t planning to offer steep discounts on Cadillac vehicles to chase volume (something some of its competitors do from time to time), while building out the brand and its portfolio carefully and responsibly (good thing the Lambda-based Cadillac crossover is no more).
Overall, this strategy differs greatly from that of the Cadillac of the early 2000s.