Cadillac president Johan de Nysschen knows very well it could take years before the brand begins to truly turnaround and post sales numbers on par with other luxury automakers. Most people don’t like change, but that’s exactly what his job is all about, even if it’s not going to result in strong short-term results.
A recent USA Today article discussing Cadillac’s sales, which were down 5.9 percent in the first 11 months of 2014, pinned the brand’s poor market performance on the higher prices of its cars. The vehicles are better than ever, but the prices also reflect this, which has driven former Cadillac customers away.
“You’re putting the brand at a different price point than the traditional Cadillac customers are used to,” de Nysschen told USA Today. The former Audi exec admits their target buyers, the one’s who currently buy BMWs and Audis, “can afford it (the price), but don’t have it on their priority lists.”
Cadillac’s marketing chief, Uwe Ellinghaus, calls this a “relevancy problem.” Cadillac has a good name and reputation, however most consumers with the money to buy a luxury car simply don’t consider the brand when shopping around. So they’ve driven away former customers with raised prices, and those who can afford the cars don’t know about them.
“They increased the price and had high (sales) volume expectations. You can’t do that unless you’re a brand with the right reputation,” explained Michelle Krebs, an AutoTrader.com senior industry analyst.
But de Nysschen has more than a few tricks up his sleeve which he believes will result in a boost for Cadillac. Between the relocation of about 100 employees to the trendy SoHo neighbourhood in Manhattan, the introduction of the CT6 and several other crucial products and reporting its earnings separately, he just might earn it the spot at the cool kids table it needs in order to move more metal.