Cadillac CT6 And XT5 Usher In New Pricing Strategy Under Johan de Nysschen13
The 2016 Cadillac CT6, frankly, shocked when it was revealed to start thousands of dollars less than comparative German rivals. But, that’s all part of the plan according to Cadillac President, Johan de Nysschen.
According to the latest report from Automotive News, de Nysschen wants new and future Cadillac product to “earn” their prices. It’s also a play directly from his time with Audi, where vehicles consistently undercut Mercedes-Benz and BMW, only to eventually increase as respect and equity built for the brand.
de Nysschen also said he would rather price the 2016 Cadillac CT6 to sell, rather than spoon feed incentives for the car over time.
“Knowing that, it seemed to be more sensible to price CT6 right and let the car gain traction,” he said. “We need to give the car time to establish a reputation. With a very compelling product offering and a good price, I think that’s the way to do it.”
Though the 2017 Cadillac XT5 has yet to be priced officially, the Cadillac boss also said to expect a very similar strategy to what we’ve seen with the 2016 CT6, and stated it will be “competitive.”
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Hasn’t that basically been Cadillac’s strategy since the CTS in 2003, with exception to the Escalade which didn’t need to go that route. CTS was 3 Series price and equipment with an almost 5 Series size
My thoughts exactly! This was a strategy Cadillac prematurely diverted from. Offering more car for the money has much more appeal with the masses than a strong performance merit.
With what they’ve accomplished through the ATS and CTS, my hope is that Cadillac can implement more affordable pricing while still offering class competitive quality and content.
good that leaves room for the CT8
This is the only strategy that makes sense. You have to earn the premium price, not expect it.
I couldn’t agree more and I’m glad to see Mr. de Nysschen back away from what he called his “Premium Pricing Strategy” which practically killed the new CTS. the CTS and CT6 seem to be reasonably priced. I recently built a nicely equipped CT6 V6 Luxury AWD Sedan. It priced out at about $63,500, which is very close to what the MSRP was on my, similarly equipped, 2014 CTS. The same car now would come in well under $60,000. I’m glad he figured it out before he killed the brand.
Although I was one of the crowd that was suprised at the cost of the CT6 , Johan’s strategy I believe is on tract . To build the company you need to have a product that is almost an entry level car that is done right and then get those customers to come back and buy something that is more upscale . That will help to create a customer base .
And in doing that you also need to be competative in the segment . I wonder though if the bean counters had something to do with the pricing , lets hope not because that will hurt the image that Cadillac is trying to accomplish .
Same with the XT5 , price it right but not at Walmart prices . Let Chevy and GMC take that on . The SUV market is hotter than ever , set a goal for volumn and try to keep it as exclusive as possible .
I think Cadillac learned a lesson with the current CTS by over pricing it and then having to lower the TAP by as much as $ 3000.00 .
Folks need to keep in mind this is a marathon and not a sprint .
Glad to see this. Enough of the conversation that “you have to be priced at German prices to be considered luxury.” With that being said how did the an ATS model just jump 2,000 without a refresh or major upgrade.
Pricing of the CTS has confused many from day 1 and nothing really has been done and sales have proven it. The car is great winner of multiple awards but sales have failed. I think we are going to have to wait until successor models are brought in to reveal new pricing strategy in each new model.
This is virtually what every luxury brand has done. Even the Genesis has done this.
Cadillac should have earned it’s stripes by now. It’s on par with every German premium nameplate.
Is the brand’s problem design? Marketing? Street cred? It’s American ownership? Brand history?
Probably all of the above. Cadillac must find a niche, and grow from there. This is neither a dedication to art (unAmerican) or need for speed meaning immediate release of V series products and it’s transformation into a powerful sub brand halo like AMG.
The perception just isn’t there. Let’s not forget that the company was bankrupt less than 6 years ago. Image really takes a hit when that happens. lol
People buy luxury cars to demonstrate their success and Cadillac to most people isn’t even considered especially outside the US.
Give him enough rope.. as Johan de Nysschen is pricing Cadillac models as if they were made by BMW or Mercedes and while this scheme may work, I suspect this approach will cause General Motors’ Board of Directors to wave good bye to him because there has to be a reason why someone to buy a Cadillac instead of a BMW; a slight edge in performance might work except Cadillac hasn’t done anything and de Nysschen needs to know he doesn’t have 10 years as results need to be coming or de Nysschen will be history.
Ok then, what will the introductory and the first year’s pricing going to be? Somehow, I didn’t get to read that part…
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I think a lot of this is all due to the issue of that Johann inherited someone else’s cars. While not bad cars by any means but he was better. In the mean time he has to do the best he can with what he as and direct the company to where he wants it.
This is why we have too few SUV models and too many sedans. He did not pick these and is working to change the line up. Pricing will be in flux here for a couple years.
The Cadillac’s have been cheaper than the other brands and now with extra options they will a better value. But as the cars improve look for the pricing to move to where they need to be.
The bottom line here is these cars are not really cheaper they just added in the incentive. What looks worse added incentives or a lower price right now.
In the end they still make the money and they will hold a better image vs. the discounted lease advertising that even the other do themselves.