August 12, 2015
With an eye toward bettering its bottom line, Global Cadillac President Johan de Nysschen announced to investors that the company is including five new SUVs or crossovers to its production plans by 2020. Cadillac is shifting toward these growing auto segments in a concession to dwindling Cadillac sales in the U.S. car market, along with the surge in SUV and crossover vehicle popularity among Americans. In addition, according to de Nysschen, a new subcompact car and three other vehicles that are said to be a cross between a compact and a midsize car will join Cadillac’s production schedule in the coming years. Cadillac’s long-term sales goal in the U.S. car market is to better its projection of 275,000 vehicle sales in 2015 to an ultimate goal 500,000 in annual sales by decade’s end. Should Cadillac prove capable of hitting this sales target, it would allow the automaker to capture 5 percent of the global luxury car market by 2020. Cadillac currently has a 3.4 percent share of that market. In seeking to accomplish its sales goals, de Nysschen admits Cadillac will have to contend with a perception problem relative to other auto brands. Speaking to an audience at the J.P. Morgan Auto Conference in New York, de Nysschen was blunt about the company’s current predicament. Even though dealer sales did improve this year by 2.5 percent as of July, overall Cadillac sales in the U.S. car market declined by 3.1 percent in 2015. Moreover, through July Cadillac sales are down 2.4 percent compared to the previous year, while other luxury makers like Lexus, Audi, BMW and others have soared. De Nysschen wasn’t shy about challenging Cadillac dealerships, many of whom have more vehicle inventory on their lots than Audi but sold fewer cars, to step up in contributing to the overall health of the Cadillac brand. “The reality, particularly in the U.S. is that the quality of the Cadillac dealer network does significantly trail that of our competitors,” he said. Much of this growth experienced by Cadillac’s competitors is attributable to a surge in the crossover segment, where the majority of luxury manufacturers have several models while Cadillac only has the SRX (pictured). To restore the brand’s prestige and market share in the U.S. car market, De Nysschen recommended expanding the number of Cadillac crossover models, pricing them at reasonable levels and providing a dealership experience that will encourage consumers to buy Cadillac vehicles. Cadillac is prioritizing improving its U.S. sales while simultaneously deemphasizing its reintroduction to the European market in 2020. According to de Nysschen, the company wants to strengthen its brand in other markets—which presumably include the U.S.—before it feels prepared to challenge German powers like Audi, BMW and Mercedes-Benz on their own turf. You can read more about Cadillac’s expanding lineup—or perhaps purchase a used Cadillac in your area—by keeping it tuned to Auto Publishers, your source for news on all things automotive!