Cadillac President Johan de Nysschen said the luxury division is enjoying strong sales, but still has work to do.
Cadillac expects to set another global sales record in 2018 thanks to the strength of strong sales in China where the brands sales of surpassed more than 200,000 units in just four years.
Johan de Nysschen, General Motors executive vice president and Cadillac Global president, spread that bit of good news during an appearance at the Automotive News World Congress today; however, he added that Cadillac’s transformation is still very much a work in progress.
U.S. sales dropped last year and Cadillac is still grappling with cultural issues, particularly with its dealer organization in the United States, which has long depended on deals to help move the metal, he acknowledged. Cadillac will continue to face challenges in the U.S. again this year.
In addition, 493 Cadillac dealers sell fewer than 50 vehicles per month, which places a burden on Cadillac’s efforts to elevate the retail experience and the appearance of the brand’s showrooms across the country.
(GM sales pass 4 million in China for the first time in 2017. Click Herefor the story.)
Cadillac has done well in China, but the U.S. market is lagging due to a shortage of utes.
However, Cadillac is not out to reduce the number of dealerships, said de Nysschen, who acknowledged that conversations with many Cadillac dealers have been painful at times. “But there is no effort to reduce the dealer count,” he said.
The fact is the existing dealer network allows Cadillac to reach into many smaller markets where its competitors are not present.
Becoming the fastest growing luxury brand in China, however, has given Cadillac the resources to carry on its transformation and to remake its product portfolio. The first new product in Cadillac’s product offensive are due out during the fourth quarter and the second product will appear in Spring 2019.
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“Looking for white space with new brand values is a once in a generation,” added de Nysschen.
For too long, Cadillac had relied on a “U.S.-centric” product strategy that basically shut it out of many export markets. The company’s European and Asian rivals had to rely exports. The export-oriented strategy lead to the development of more robust product lines in many respects.
(To see more about Cadillac’s plans to focus more on SUV sales, Click Here.)
Cadillac, on the other hand, had to face the constraints of its relatively narrow product lines, including the decline in profitability.