Maximum Bob thinks time is on Cadillac’s side in terms of the brand’s renaissance, and feels Cadillac is making the right decisions to position itself as a true game changer. During an interview with CNBC, Lutz points out a few key things on why Cadillac is making the right moves.
First and foremost, the drop in sales was to be expected, says Lutz. While Cadillac readies its onslaught of new product, it is also developing a target marketing and branding strategy for said product. In the mean time, Johan de Nysschen, Cadillac President, has deflected ideas of heavily discounting product, subsidizing leases and other “quick fixes” to keep sales numbers up.
With Cadillac discontinuing nearly all of its fleet sales, which Lutz point out in the interview, it’s no surprise to see contracting sales.
“With a luxury brand in the long term, you don’t want to do supply-push, you want to have demand-pull,” says Lutz to CNBC.
It only makes sense and, as we’ve analyzed in the past, good product with proper branding will create the pull. Lutz believes it will be about two years before we see Cadillac really hit its stride with product and marketing, and only then will the numbers reflect that.
The other important take away from Lutz’s comments are his thoughts on the upcoming CT6, which he states he’s driven. He concurs it is a truly incredible vehicle, with world-class engineering and “will get rave reviews from the automotive press because it is truly an excellent car.”
Have a look at what Lutz has to say down below, and let us know, do you think his points are valid?
Comments
Bob hastily corrected himself at the end there. He referenced the new SRX as the GM SRX and quickly called it a Cadillac SRX instead. This is exactly what de Nysschen is trying to get away from. People knowing full well vehicles like the SRX, CTS, ATS and upcoming CT6 are just GM’s. This is the same problem Chevrolet has as well as witnessed in the smallblock article here. They too are just GM’s. Things like Chevrolet and Cadillac aren’t real companies. They’re marketing spoof. GM Malibu, GM ATS, GM Tahoe, GM Escalade. It’s all really GM behind the curtain. I’m not pointing this out to be negative but I am pointing out I think de Nysschen is correct in his wanting Cadillac to become one day the Cadillac Motor Company or division again like it was in it’s prime. Not just a GM, but a genuine Cadillac. His move to New York signified his commitment to that. I hope it’s not too late and that it works.
Bob calling it a brand instead of a company doesn’t help though. Brands are a 90’s thing way past their fad expiration date. People are coming back around to wanting real things again. They also kept talking about GM, not necessarily Cadillac. GM, Mary Barra and the like really shouldn’t even be mentioned. It’s not doing them any favors. And the new head of Cadillac has a tough road ahead because from what I’ve seen, his biggest competition is in house. GM is giving all the best stuff to Buick and even the Denali line of GMC. The Buick designs coming out are drop dead gorgeous. In my opinion, better looking than current Cadillac’s. And many think the same thing all over the net. Even sales of Buick’s are proving their designs are a hit. I don’t even know what to think of Chevrolet either. Not very attractive nor impressive design language outside of maybe the C7. Not very nice inside either. I dunno man… Both Chevrolet and Cadillac have been put in very tough positions against Buick and GMC. The market is tough these days and very short sighted. I don’t have as much faith in Caddy or even Chevy like Bob seems to.
I’m with you there. I’m rooting for GM, but differentientation will be make or break for the success of every business unit under the GM umbrella.
Well It is ok for Chevy as GM is Chevy and Chevy is GM anymore. This is where most of their volume is.
As for Cadillac it is ok for Cadillac to be GM as they have been for nearly a century. The problem is Cadillac has been Chevy too.
Like I pointed out in the other thread that it is ok for Cadillac to trickle down thing to Chevy as in the long ago past but when they started taking Chevys and making them Cadillac’s that sent a poor signal. This is what still haunts Lincoln and in some cases Lexus.
But you are correct moving Cadillac away and making them more independent will only help. But they must get away from taking cars like they did with the Caprice, Corvette and others and making them Cadillac’s.
Now taking a ATS and making it into a Camaro is less of an issue as they will more and more share less other than the base architecture.
The thing for GM is to make it OK for any vehicle to be stated as a GM vehicle. The GM name got tarnished and that also need restored for all division or branches.
In the 30’s it only helped Cadillac that they were part of GM back then and that again can happen but they also were not building Cadillac’s based on Chevy models either.
It will take time with the move to NYC and the new product with their own engines to really show they are their own brand but in the interim we will still see better and better product.
Eh, I’m not so sure about that. 30 years ago I would have agreed, Chevrolet and GM were almost one in the same. Chevrolet had it all going for them for probably 60 years solid. Even 20 years ago I ‘may’ have agreed as GM was still sticking Chevrolet engines (the real ones) into other divisions products. These days, not so much. Chevy doesn’t even make engines now, GM Powertrain does. So it’s extremely hard for me to say that for example, an Escalade is a tarted up Chevy anymore. If anything, Escalde is a tarted up higher GM Denali and Tahoe LTZ is a downgraded GM Denali. Chevrolet sadly comes across to me these days as just a marketing arm for GM Powertrains racing and performance endeavors.
Post bk restructuring, GM’s own GMC is the companies go to core for low rent Chevrolets of the same models and higher rent Cadillac’s of the same models in the suv arena. GM’s car and cuv core is it’s very first company Buick. It’s not really Chevy that’s going head to head with things like Nissan and Ford now. Companies like those have moved onward and upward from Chevrolet. It’s Buick who is the main competitor. And in a world that has a tough time distinguishing mainstream from luxury, it’s not a good spot for Cadillac or even Chevrolet to be in. As Buick’s and GMC’s pretty well cover both of those mainstream and luxury territories perfectly. Especially with their post bk designs and marketing.
I think you are confusing things here.
It was up to around 78 GM let divisions do their own thing right up to the engines but a lot of input from GM engineering at the tech center
After that they were charged with different engines like Chevy with the V8 and some V6 engines. Buick was V6 and Pontiac with the 4 cylinders.
They still were mostly plied with work done by GM engineering. Olds and Cadillac did the N Star and Quad 4 but they were underfunded and suffered for it.
Today most engine work is centered at the GM powertrain level and what will happen is Chevy and Cadillac will be set to be given engines of their desire from powertrain.
As for product Chevy is head to head with Ford, Toyota, Honda, Nissan and others. Who the hell else are up against? Now are they doing as well as they should be no but they are closing ground with old product and will more than make up the rest and more with new product like the BU. Cruse and New Nox. Hell the old Nox has climbed to kill the edge in sales and they are far from discounted cheap unless you get a gutted one.
Buick will fill the void left by Cadillac in between Chevy and Cadillac. They will get more expensive but they will bring much better cars too when it is their turn. The new Lacrosse will be the first and it will tell the direction.
The deal with Chevy is they cover everything from entry level car market to the entry level Luxury. they have the widest market and that is because they are the volume brand. They Make money based on lower prices and higher volumes vs where Buick and Cadillac will be lower volume but more profitable on price.
As it is Buick is only here because of China. So GM kept them here as they had nothing to lose. It will be a division they can play with and do things with little risk as China is paying the bills. I see this as an advantage as we saw with their show car in Detroit they could stretch things a bit and make it interesting.
They will be against Acura, Lincoln, Lexus, Infinity and high end Hyundai. This segment is always in flux and is often more bases on the value volume brand to make their money. hence the Acura’s that are bases on Honda’s, Lexus bases on Toyotas and Lincolns bases on Fords. In GM’s case they will share much with Chevy but only after it has been though Opel and that should help much.
You have things targeted way off and it is a little more complex on how things will end up.
The bottom line is GM will operate as a corporation to supply the needed things for each division. Now the differences will be on how they fund them to be able to supply the things needed to make them each a division to their own. We have seen this commitment already given to Cadillac.
I’m confused.
Why is it that Toyota makes Lexus but no one refers to a Toyota Camry as being a Lexus IS 250.
Same thing with Nissan and Infinity. Isn’t an M class Infinity the same as driving a Nissan Altima?
It’s baffling to me how GM gets taken to task for referencing Cadillac, one of its core brands, but other car companies with sister divisions don’t
Why is that?????
The reason GM gets hit more often is that while they were doing what most others were doing they were doing a much poorer job of the same thing.
Look at the FWD cars they build in the 80’s and 90’s. Even the RWD Fleetwood was a Caprice made into a Cadillac vs. a Fleetwood made into a Chevy.
You can dumb down a product but you can not dumb it up. Poor choice of words but I think you get the point. It is ok to make an Alpha a Cadillac first and then move it to Chevy vs. making a Chevy into a Cadillac. While you can still make a good car it looks bad for image.
Even while the LS engine is a great engine it is still an engine that is from a truck. Chevy can get away with it but once you put it up against the Euro brands that have their own engines for the most part and they never were in a Pick up truck they hold a image over Cadillac that while is unfair is still a disadvantage.
It is kind of like taking like the Beverly Hillbillies. They may have the money and live in the best neighborhood. They may have more common sense than all in the room but yet they will be looked down on because they are not playing the game on the same level. It may work for a family because they have the money and don’t care but when you are trying to sell a car like this it is all about impressions and image.
Cadillac is only trying to separate themselves from GM to enhance their image as being more independent. But the truth is they will still rely on GM who has now enabled their engineers and designers to do what they do best vs. the past.
Also I think they moved Cadillac to NYC was more to keep those who have fought moving Cadillac up at bay. They can make their own decisions and choices with less interference.
GM has been their own worst enemy and that is finally changing.
As for the others not getting gigged for the cars on the same it also is because they get a free pass too often, Fair…no but just the way it is.
Wow, I am shocked that some of you still do not get this. Cadillac is currently a brand. What GM, the company, is doing with Cadillac is further differentiation into a more stand alone entity. I believe this started over a decade ago and got held up due to bankruptcy/bailout. This benefits all of GM, as has been stated many times before, with trickle down. Just look at the news yesterday that the Gen6 Camaro will be 70% Chevy parts. So, the Alpha platform was developed by GM, Cadillac refined it and has had 2 years on the road with it and now Chevy comes along and actually makes it a Chevy.
This feels like a renaissance where each brand has more flexibility in the product it develops. So, what we get is GM development of chassis, engine, and transmission and each brand works within that. Although, it looks like Cadillac is getting some autonomy in the future in regard to engine development.
And in case we forget, every major car company on the planet works this way! I love this as an example, Volkswagen Touareg. Audi Q7, and the Porsche Cayenne are essentially the same vehicle, but you don’t hear people walking around going “the Q7/Cayenne is just a dressed up Touareg” do you? When Volkswagen develops an updated SUV platform what do you think happens to Audi and Porsche? They get updated too!
Excellent post, Jon.
Good post Jon. .
Well, I’m not so enthusiastic with the Cadillac present and future. In Europe Cadillac remains a prestigious and gorgeous brand. But when you see the lines and the names of the actual Cadillacs they are not from the same mold of the past. People remembers names like Eldorado, Seville, Fleetwood, Deville, Calais and with these awful names of nowadays they don’t even know that these cars are Cadillacs! GM is right to make efforts on quality, engines, but they are wrong to forget Cadillac’s patrimony and history! Some concept cars have made the buzz even in Europe but the actual cars are totally forgotten! Just see the sales decline too in the USA is the proof that copying BMW or Audi is not the good strategy! People, and more the rich always favours the original vs the copy! My advice should be: Be American, be proud of Cadillac! Look back to Bill Mitchel’s awesome designs, bring back legendary names like Eldorado, Fleetwood Brougham Talisman, Seville, Calais, Biarritz even V16!!! Try it first in the US, then in China and I’m sure you will see the sales rising again!