Should GM Spin Off Cadillac?
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The auto industry as a whole is still grasping what just happened with the ousting of Johan de Nysschen as the president of Cadillac. The outspoken executive was, outwardly, the most ambitious leader the brand has seen in decades, and seemed committed to turn the brand around. Whether it was going to be the rebirth of an American icon or simply a German-brand alternative at the end of his 10-year plan, we’ll now never know.
The turmoil still has columnists and analysts openly theorizing what would be best for Cadillac. Columnists going as far as to say executives at GM lack vision to transform the brand, to analysts suggesting that General Motors should spin off Cadillac a la FCA to Ferrari in an IPO, or even a sale to another company.
If GM does indeed lack the proper vision to turn Cadillac around without Johan de Nysschen, then perhaps spinning it off might be what’s best for everybody. However, if new brand president Steve Carlisle and marketing chief Deborah Wahl have the conviction to maintain course with some of JDN’s strategy of building up desirable products and uplifting the dealership experience, then Cadillac might be better off within the GM fold.
We’ll take this moment to ask you, the readers, what you think should be the next major strategy for Cadillac. Should it stay? Or, should it go off on its own, even perhaps to more welcoming arms?
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No. GM should work on Cadillac quality.
No. GM should definitely keep Cadillac.
No, who cares what analysts think, they don’t run corporations and wouldn’t know how if given the opportunity!
But then again, neither do I, again, NO!
Who would want it?
No, it makes no sense for GM to sell Cadillac. GM is not in need of the cash and has stable lineups across Chevy, Buick and GMC. It makes sense for FCA to sell off brands because:
a) They have way too many brands overlapping each other.
b) The only brand that has a stable lineup is Jeep.
c) FCA is in desperate need of money to build up the models for mainstream brands.
GM is not in a situation where it makes sense to sell Cadillac. It would certainly come back to haunt them in the long run.
No.
They should have stayed the course and let Johan finish what he started. But the GM bean counters and or the stock holders do not care about long term success.
Not sell it but give it an IPO
That’s a contradiction in statements.
If they give it an IPO then anyone can buy stock and own it.
Uh, no. If that’s the case FCA wouldn’t still own Ferrari nor Ford family own FMC with their IPOs. IIRC it’s a special stock GM (or any entity) can put out w/o losing control of what’s been offered.
No. You’re thinking of the different classes of stock in regards to voting rights. Cadillac would still have to be spun off to do an IPO. Ferrari was able to have an IPO because the company was spun off from FCA. The IPO was only for 10% of the stock, though (no company ever offers even half of its shares in an IPO). FCA distributed its remaining 80% of the shares to FCA stockholders, and Enzo Ferrari’s son owns the remaining 10% of the company as he always has.
If GM were to spin off Cadillac then they might as well stop selling cars. This is the problem of the American brand car companies in the US and Canada and wherever else. The Negative perception of American cars is never ever going to change. Cadillacs, chevies and Buick’s have the same quality as Honda, Toyota, Lexus and BMW but people and journalist still view GM and ford as still cheap and unrefined when that isn’t true anymore. Cadillac can change CUE, redesign a much bigger and more refined ATS or an even more formidable CTS and still Cadillac is liked as meh to the buying public no matter what.
GM or Cadillac gets the negative perception from actual owners. The public, reviews, feedback, comments. Quality = how many letters of recall stuff, rattles, squeaks. Reliability = how long stuff lasts before needing work. Customer service = how you are treated by the manufacturer. ( not the dealer ). Look at Toyota, I have never owned one but know plenty of people who do. It appears to me they last, and when they know something is wrong they fix it. You don’t always need letters, recalls, blame, just fix it. Lets just take a few SIMPLE items, CUE , we like our ATS CUE, but MORE then less people don’t like it ( its NOT a perception ) MORE then less people don’t like it. Look at the 2.0 T motor, ours is OK, but some people have had BAD luck with them. Look at the 3.6 motor and timing chains, they will fail before the motor is warn out, now there is a new one. Look at the Northstar in 1998-1999, did all of them have head trouble, EVERY one I know of did, the 1996-1997 didn’t, the 2004-2005 didn’t. Look at cracked dashes, I have never had trouble but read it search it there are thousands. I could go on and on and on, You get NOTHING from GM CUSTOMER SERVICE, and to make it worst a lying Service manager at a dealership who knows nothing about a vehicle will get you somewhat blackballed. If things go good you are in great shape BUT WHEN things do not THE CUSTOMER if left hanging NOT THE DEALER. Don’t take my word for it, READ, RESEARCH, its NOT perception, its REAL. If you or anyone else thinks this 2.0T in my 2014 ATS is as refined as a Audi you are crazy and just simply wrong. Now there is a NEW 2.0 T ” why don’t you spend to much money and try this NEW one” I know we told you that our last one was a great one but believe us now this one is better its a NEW one. IF YOU CALL US WITH TROUBLE WE WILL TELL YOU TO TALK TO YOUR DEALER BECAUSE WE DONT CARE. Its called DENIAL.
You’re wrong to suggest Chevy and especially Cadillac offer top tier quality and reliability. Simply ridiculous.
You’re right to suggest Caddy has a brand problem. It’s a mammoth one. I have a solution posted elsewhere on this page.
I am not wrong. I own one. It has been very reliable. The one problem I had with my Chevy, the dealership honored the warranty claim without a problem. Everything from the engine to the interior accessories still work like when I first got the vehicle and it is now 7 years old. Now looking to upgrade I went to see choices from VW, Honda, and Toyota and the build quality and materials used for the interiors are very similar in quality with VW being the worst of them all though still looking good.
Fuzzylobes,
I would have guessed 1 MILLION DOLLARS that you would say ” Its not the vehicles its the press ” Well I am here to tell you its the vehicles – quality, reliability, and customer service. Are you on the board of GM, because it feels to me they are saying the same thing. DENIAL. I have owned 5 and the 2014 ATS AWD Premium Performance has been the worst so far. And customer service HA – HA – HA, you call Cadillac you get ” well take it to the dealer ” Well the dealer sells Cadillac, BMW, Mercedes, they have to deal with GM. And down the road is Audi. Guess what people are driving off the lot, and guess what people are driving in the service door. That damn press they can’t tell the difference between Cadillac and the rest. I come from a GM family, and we ALL drove GM, Cadillac, Chevrolet. Well I bought a 1996 Deville Northstar, Great car. So my mom got a 1999 Deville Northstar. her head gaskets leaked at 90,000+ miles and mine ran 200,000+ miles. ( cost reduction ) So research said they, Cadillac, fixed that. Well research was correct, Our 2005 SRX ran 140.000+, only a transfer case chain at 78,000 miles. So when we bought our ATS I ask the salesman, did they fix that transfer case chain trouble. He says ” we never saw a transfer case chain trouble”. I personally know of 3 and only 1,000 to 2,000 miles apart. Just like the head gaskets ” what head gasket trouble”. Well long story short. My mom still has her 1999 Deville NOT GM FIXED, I have our 2004 CTS 3.6 140,000+ needs timeing chains ( Great Car ) and our ATS. BUT, BUT moms brother, Mercedes. His son, Toyota pickup, Audi car. My own sister Ford pickups, Lincoln SUV’s. My brothers son, BMW. And so goes Cadillac. By the way I have a $75,000 Denali HD and it needs to or has been to the dealer for 5 recall or quality items and has less than 5,000 miles.
No it’s the long time perception from before when there cars were actlually crap. I own a GM product now and service at the dealership has been great, the quality is comparable to whatever is out now and only had 1 problem and it was taken cared of by the dealership without issues. I don’t see how I am in denial when I am experiencing all of this. The car is now 7 years old and still running like a champ. Now I am not gonna listen to you and your past issues. I am going to go by mine and a few people I know they recently bought Cadillacs and Buick’s who hsven’t Had any of the mentioned issues you had. Their cars are still running great today 4 and 5 years old vehicles. And we aren’t in denial. If I could show you my maintenance receipts to prove you wrong and that I am not in denial I would.
No it’s the long time perception from before when there cars were actlually crap. I own a GM product now and service at the dealership has been great, the quality is comparable to whatever is out now and only had 1 problem and it was taken cared of by the dealership without issues. I don’t see how I am in denial when I am experiencing all of this. The car is now 7 years old and still running like a champ. Now I am not gonna listen to you and your past issues. I am going to go by mine and a few people I know they recently bought Cadillacs and Buick’s who hsven’t Had any of the mentioned issues you had. Their cars are still running great today 4 and 5 years old vehicles. And we aren’t in denial. If I could show you my maintenance receipts to prove you wrong and that I am not in denial I would. And I am not even including recalls because almost all those cars you mention that have a so called reliable reputation has recalls too and whatever mess. The last foreign car I owned a 2007 Honda Civic had its power rain warranty extended due to the engine block developing a crack as enxample so i must be in denial about that happening to me too.
Well that Honda extending that warranty is exactly what I am talking about. They knew they had trouble so they want to fix it. I’m not saying you or all GM vehicles are junk or even have troubles. If you know haw things fail it’s a bell shaped curve the top round of the bell is where the average fail, the front end of the upward curve is early failure, the tail end of the downward curve of longer lasting. Lets just say 10% fail early and 10% fail late that’s 80% that fail as expected. BUT if you own one of the 10% early and GM/Cadillac treats you like you are to blame for there car failing early, they are actually sending 10% of there customers who want to drive and have bought there vehicle already. You are in DENIAL thinking all of GM products have great quality and reliability. READ CADILLAC FOURMS, CANYON FORUMS, you will QUICKLY learn how many people have trouble. You cant even read Facebook comments without getting people with troubles. I believe you on your great vehicles. I have had them also. However you can come over to my house and I will show you parts and invoices of my troubles, recalls, customer satisfaction repairs, ETC. Right now on Cadillac Forums there are people having trouble with there cars. IF Cadillac wants repeat buyers and young buyers for life, they need to quit nickel and diming people on simple repairs. Also if Cadillac wants young buyers I am raising two sons that are listening and watching me deal with GM and a lying service manager on a $50,000 car and a $75,000 truck.
If GM has been respected at some point of time, it’s because of the wonder it made of Cadillac once.
And Cadillac must be proof that GM can once again be respected.
Shouldn’t sell it but needs to give it some TLC. Make Cadillac the standard of the world again. Not just with words but with all the pessary ingredients to make it so.
No
Cadillac needs GM as they can not do it alone. It would only drive up cost
Now GM needs to continue to give Cadillac autonomy to operate as an independent company with in GM. It would not only be better for them but also For Chevy.
You put people in charge of these brands it is time to let them run them not the Board.
It will never happen. However, I’d just assume they not only spun off Cadillac but Chevrolet as well. The independent Chevrolet Motor Company outsold all of GM combined before it became part of GM. No doubt in my mind it would do it again once it became it’s own company and wasn’t artificially held back. The Cadillac Motor Company could once again be the standard of the world it once was. As of right now, both are literally nothing more than fake marketing brands for General Motors products. Yet that was not always the case. Once upon a time they were real companies. GM was just a holding entity. Then they became separate Motor Divisions, then came One GM and those once glorious companies exist in marketing name only.
Let GM go back to being what it started out as. The Buick car company and some GM’C’ trucks. Cadillac is really hurt by Buick, Denali and now Avenir. Chevrolet is also hurt by Buick and GMC in many of the same areas and many other ways as well. It just doesn’t work anymore.
if gm wants to unload cadillac, the only way it would work is if a deep pockets buyer with patience bought them. in other words, a chinese manufacturer. throw in buick too and it is a done deal. look at what geely did to volvo. they’ve improved dramatically.
but i don’t know how a spin off solves anything. you are basically saying being part of gm is so toxic that it is time for a divorce. i don’t agree with that at all.
Elton John could release a new album better than any previous release. But it is past unlikely this will happen. It’s basically impossible. Similarly —
— there is no way Cadillac can become Cadillac again. That day has past. It could definitely improve, sure, and be cherished by some, absolutely, but the likelihood for it becoming the King again is so over.
However…
… Tesla has no direct competitor. Cadillac could try to become the King of All Electric Vehicle. Or all non petrol cars. This means they only have to beat one company for the the title. In my opinion —
— this could be a walk in the park for Mary.
Just what is Cadillac really? We could as 14 people and maybe get two to agree what is a Cadillac.
The key is for Cadillac to just define what they are today and be relevant.
Even BMW and Benz have had to keep themselves relevant over the years but Cadillac just never kept on point in the 80’s and fell behind.
Yes they will go Electric with some models but profits are limited and every brand is going this way too. It will not be a walk in the park but a fight on the streets, GM is in a good place to compete but the ICE is not going away soon and still has a major part to play.
Even The Beach Boys got back wit Brian Wilson and had an album that went to number two after 50 years. Aerosmith still relevent and had some of their best sales in the latter part of their carreer.
It is all about giving something desirable and relevant not what you did 60 years ago.
“Just what is Cadillac really?”
Note your tense. Cadillac is NOT a player. Or a success. I don’t care what 14 ‘Beach Boys fans’ think or believe or feel or reminisce. Cadillac IS not.
“The key is for Cadillac to just define what they are today and be relevant.”
There is no way to make Cadillac different enough to compete with the other premium luxury brands.
“Yes they will go Electric… and every brand is going this way too.”
Distortion. There’s a critical marketing difference between ‘eventually going electric with everybody else’ and ‘committed to all electric FIRST’. If you’re going to dismiss an idea represent it properly first.
” — but profits are limited.”
Of course they are. But Cadillac is a luxury brand that, like Tesla, can ask ridiculous prices.
“It will not be a walk in the park — ”
Nothing is a walk in the park. But the opportunity for Cadillac to beat Tesla (or at least tie) is a WALK IN THE PARK compared to Cadillac taking the shine off of BMW and Benz and others.
Last time I checked GM has introduced an industry impressive electric engine. Last time I checked they intend to spread that tech throughout GM. But the best way to SIGNATURE electric to GM is via their currently dead brand Cadillac.
“Even The Beach Boys got back wit Brian Wilson and had an album that went to number two after 50 years.”
… and absolutely NOBODY but elderly fanboys gave a rat’s butt about it. Thanks for making my point.
Well I was not elderly and I was not the only one there that was younger.
Missed a hell of a good show.
Not going to argue with you. Just not worth the time.
Like I said. Absolutely nobody.
This horrifically bad idea needs to end before it starts spreading. The only ones that will gain from Cadillac spin-off is Wall St. on the ipo. The cars are world class. But you cannot beat Mercedes by copying Mercedes. Drop the pretentious b.s., bring Cadillac back to Detroit… and bring back the marketing team responsible for this.
https://youtu.be/aMUZNbyYU8M
State franchise laws could make a “spin off” a very expensive preposition because as stated here on GMA, JDN never even received his full wish to buy out all 400 of the smaller Caddy dealerships as GM relaxed the Project Pinnacle requirements including roadside assistance…
Here’s how you fix this mess immediately and in the future…
Near term: Starting TODAY, just about every GM light duty vehicle has OnStar and wifi hardware, Cadillac should announce that all MY18+ models will get these subscriptions for free for 3 years…The buyers kids/grandkids will BEG their parents/grandparents to buy a Caddy over a BMW and OnStar would provide the “free” road side assistance that Project Pinnacle has now abandoned…Next the other big thing that can be offered is the “Cadillac Experience” at the dealership…Many CHEVY dealerships in the SoCal area offer free delivery when you buy a vehicle where a dealership delivery person drives the car to your home/office, shows you the features and ubers home…Caddy needs to offer this option for both at the point of sales and but more importantly pickup and dropoff for SERVICE…It really is not that expensive to pay a couple of people minimum wage to do this and there could be money saved from not giving out service loaners…These are some extremely convenient amenities that offers something few brands offer which would further help distance themselves from Buicks, Denalis, etc and its extremely easy to market and seems far better than offering “$10K off” incentives…
Long term…So now your getting people excited about the free connected services and not having to go to the dealership for service now Cadillac can really find itself and focus on creating a more premium lineup…
I think JDN’s idea of Cadillac takeing ten years to be a true competitor to Mercedes and the like was correct. It just took him too long to get the right products into the pipelines. I would guess that part of the problem was GM’s Board. The lack of the right products and a tarnished reputation makes it difficult to make progress and move ahead to any goal. Be it vehicle or anything else you are trying to sell. It is also important to remember if you are gunning for the top dog you can’t cut corners.
No, but GM needs to understand that the Volume approach doesn’t work in the Luxury market.
JDN wasn’t perfect but I think he was right on the points that GM seemed to disagree with him over.
If they start chasing volume again then Cadillac may well fall back into decline.
What GM needs to do with Cadillac is further distinguish Cadillac from the rest of the lineup with the twin turbo v6 and twin turbo v8 engines. there is nothing wrong with sharing chassis but the designs should be different. An escalade should not compete styling wise with a well appointed Denali. Also no Cadillac should be a front wheel drive based vehicle. but then again no american car should be a front wheel drive based vehicle IMO. To be honest, the 464hp 3.6L twin turbo v6 should be the base engine for all Cadillac vehicles, the new 4.2L 550hp twin turbo v8 should be the new engine for the V-sport cars and the standard equipment engine for the escalade while a hotter 650-700hp twin turbo 5.0L v8 should be the new V-series engine.