By on March 1, 2010

Cadillac relaunched [release in PDF format here] its perennially disappointing European effort last week, revealing that a new sales and import firm, Cadillac Europe, had been formed. Why would Cadillac double down on a market that it until recently blighted with its ill-advised Opel Vectra-based BLS (which bizarrely still appears at the cadillaceurope.com website)? Caddy boss Brian Nesbitt explains:

Europe is an important market for Cadillac. Re-establishing distribution of our premium offerings is good news for those who seek import exclusiveness

Except that Europe and America are fundamentally different markets, with different tastes in luxury. Unless the Cadillac boffins have some kind of alternate explanation for why Lexus sells like hotcakes in the US, but can barely move the needle in Europe and is resorting to Euro-specific models to make headway. But apparently success in the US luxury market is just a few European sales away. Really.

After all, GM understands Europe, and how to sell US brands there. Just ask GM’s marketing boss Susan Docherty, who spent four years overseeing the unabashed mediocrity that is the Cadillac/Chevrolet marketing effort in Europe. As Docherty once explained to askpatty.com

One of the things we had to do to make Chevrolet and Cadillac more relevant in Europe was to go back to the history of who this person ‘Cadillac’ was, and who this person ‘Chevrolet’ was, because both of those individuals were Europeans who came to America. The moment the European consumer began to understand that those two brands had owners who had heritage that was European-based, it began to click.

Except that this may be the thinnest slice of marketing bullshit ever to emerge from the divine Ms D. For a more authentic insight into the mind of the European consumer, let’s check in with Automotive News Europe‘s Luca Ciferri, who previews the return of Cadillac with a few choice metaphors illustrating the challenges facing the Standard Of The World brand.

It’s kind of silly, really — like taking your own beer to the Oktoberfest in Munich or asking for a loaf of Wonder Bread in a Paris bakery.

I have covered the European auto industry for more than 20 years, and I have lost track of how many times — and in how many ways — GM has said it finally has found the way to make Cadillac a success story here.

Of course, as a proud Oregonian beer snob, it’s tempting to poke holes in at least one of Ciferri’s stereotype-laden jabs, but then, when it comes to selling luxury cars, perception really is reality. And I’d feel uncomfortable comparing the Escalade to a pint of Ninkasi Tricerahops. Besides, you can argue with Ciferri’s national caricatures, but his numbers don’t lie: “GM sold 3,029 Cadillacs in Europe in 2007, 2,701 in 2008 and only 1,218 last year… In the last 30 years, annual Cadillac sales in Europe have never totaled more than about 5,000.”

Ciferri’s advice: forget Europe and try harder to sell Cadillacs to the Russians. Certainly GM’s experience with Chevrolet has been that US brands sell better in Russian than Europe. Part of the problem is certainly the issue of taste, although the ongoing Opel chaos hasn’t exactly endeared GM to the European market either.

With Chevy also set to give back recent cash-for-clunker-fueled gains in the next year, GM’s overall European outlook is not rosy. Spending resources on a European Cadillac comeback doesn’t seem like the kind of move that will make much of a difference in that market, nor will it lend the brand any more of an aura in the US. So why spend the money? Because GM has tens of billions in the bank (courtesy of you, the American taxpayer), and dammit, Cadillac’s supposed to be a global brand. And that means selling it even in markets that aren’t interested. Meanwhile, the Opel restructuring is still dangling, unfunded. What to do?

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29 Comments on “Cadillac’s European Vacation From Reality...”


  • avatar
    mjz

    No wonder Docherty got demoted.

  • avatar
    Contrarian

    “One of the things we had to do to make Chevrolet and Cadillac more relevant in Europe was to go back to the history of who this person ‘Cadillac’ was, and who this person ‘Chevrolet’ was, because both of those individuals were Europeans who came to America.”

    Psst: Ms. Doherty: The Euros don’t give a damn who Cadillac and Chevrolet were. That’s ancient history from a foreign country.

    But I’m sure they’ll sell as well as lederhosen in South Central LA.

  • avatar
    Cammy Corrigan

    “One of the things we had to do to make Chevrolet and Cadillac more relevant in Europe was to go back to the history of who this person ‘Cadillac’ was, and who this person ‘Chevrolet’ was, because both of those individuals were Europeans who came to America.”

    Oh really(?) So, Chevrolet is actually a Korean in American clothing?

  • avatar
    educatordan

    I agree focus on Russia. You could likely sell armored DTSs there for years to come. In fact since GM seems to be planning to phase the car out here in the states, just ship the tooling over to Russia, set up a factory and keep going for another 20 years.

    • 0 avatar
      CamaroKid

      I would like to see Cadillac focus on America even before Russia. How many cars did we sell last year? 62,971! Off from just over 100,000 the year before. That must be some kind of record.

      Step one, figure out how to sell some cars HERE…
      Step two, expand over there…

      We are stuck, and struggling at step one

    • 0 avatar
      Loser

      “I would like to see Cadillac focus on America even before Russia.”

      +1

  • avatar
    Scott Pilgrim

    Edward–
    The BLS was more closely related to the Saab 9-3 than to the Opel Vectra/Insignia/Signum cars. Also recall that it was built alongside the 9-3 in Trollhattan.

    Just picking nits…

  • avatar
    Paul Niedermeyer

    So what US brand isn’t European? Pontiac?

  • avatar
    BDB

    I agree about focusing on Russia, and maybe try for China, too, as long as they take it upmarket enough not to step on Buick’s toes (that’s BIG “if” knowing GM). If they buy Buicks of all things obviously American brands have more cachet there.

  • avatar

    Marketing bullshit, indeed, as “Cadillac” or “Chevrolet” never have been perceived as persons in Europe for the last 50 years, at least. Russia might work (armored or not). The rest of Europe will be tough.

    Once upon a time, GM was able to sell (US-spec) cars in Europe, up until the beginning of the sixties, especially, but not limited to, countries without a car industry. At this time, competition was not what it is now. But then US cars simply grew unusable for European conditions due to their sheer size. After that, US cars became the favorite choice for extroverted pimps or dentists (with the exception of Jeeps).

    Now, with downsizing on the agenda, they might have a chance starting business again, this time as a niche market choice. But I sincerely doubt that GM will have the persistence to cover a market where you run into different cultures and languages every 200 miles. That spells costs.

  • avatar
    Ron

    The Chinese buy Buick because the Emperor drove a Buick.

  • avatar
    Uncle Mellow

    Lexus sell very well in Europe , compared to other premium makes of petrol engined cars. Trouble is , most large premium cars in Europe have diesel engines. Lexus don’t have any diesels – the small Lexus is available with a Toyota diesel , but that isn’t up to BMW standards.
    Most European buyers looking for an American car recognise that European “Chevrolets” are not really Chevrolets at all. The only American car we really see is the Chrysler 300C , since that comes with a Mercedes diesel engine. Cars here are taxed not on pollution but on CO2 , and diesels are very low on CO2.

  • avatar
    mtymsi

    That has got to be the finest Docherty quote I’ve heard to date.

    Really, if someone would just lend her a quarter she could buy a clue.

  • avatar
    FreedMike

    Are we sure Ciferri’s figures are accurate? He’s saying Cadillac sold 2,700 cars in 2008, but that figure is way off what was disclosed by the company, which is about 4500…

    http://www.gm.com/europe/corporate/sales/model/

    Now, 4500 cars a year is not exactly setting the world on fire, but in a time when the company needs every unit it can, why not keep selling there?

    • 0 avatar

      He’s not counting Russia, which was number two in those official numbers by country. He’s also citing JATO, not company figures.
      I don’t know the exact point at which there ceases to be a volume argument for selling Cadillac in Europe, but 4,500 units is what the CTS alone sells in a good month in the US. I think the American taxpayer is funding a doomed experiment grounded in the shaky notion that moving metal in Europe somehow makes a difference to consumers in the US and elsewhere. Though I failed to explicitly mention it (there is a link to the story in the first paragraph), the new Cadillac Europe was formed when GM’s previous primary European importer went belly-up. Surely GM’s money would be better spent rescuing Opel than trying to wish world-class status upon Cadillac by blindly pursuing respect in a market that isn’t in the least bit interested.

  • avatar
    porschespeed

    “Now, 4500 cars a year is not exactly setting the world on fire, but in a time when the company needs every unit it can, why not keep selling there?”

    True enough to a point.

    The deeper question is GM making money on 2700 (or 4500) units?

    There was a time when a premium priced product like Ferrari/Lamborghini/Maserati/Rolls/Bentley could make money moving 5K units a year.

    They are all now tiny little divisions of Fiat or VW or BMW.

    Given the inherent overhead of selling ANY car, I would find it hard to imagine a pricepoint that Cadillac could make money on 50K units a year. Let alone a tenth of that volume.

    So, I would ask, what’s does it cost GM to keep trying to penetrate a market that is just not a good fit instead of focusing on a market that is a better fit, such as Russia?

  • avatar
    fiatdriver

    The lack of dealers is one of the biggest problems they have. Right there they become a niche market. Then a lack of diesel engines for a market that likes diesel (especially for large cars, eg the v6 diesel is most engine in the S-class), thats 60% of the remaining market gone.

    They need to compete with BMW, Mercedes and Audi for perceived quality, and image. The CTS was the best bet for that but since the diesel was cancelled that’s just a curiosity now.

  • avatar
    blue adidas

    I say that Cadillac should make such wonderful cars, that the europeans are begging for them. Kinda like how we Americans feel about the the Euro Focus, VW Scirrocco, the Audi A7 and, for years, the Nissan GTR. I don’t get the sense that most Europeans are interested in driving a little piece of America to work everyday. Unless there is evidence that there is some sort of demand for Cadillacs in Europe, the I don’t see any reason to try this.

  • avatar
    Tstag

    Look it’s really simple. Europeans buy European when it comes to luxury cars. The reasons why are simple:

    - Styling in taste with local demand
    - Brands like Jaguar, BMW, Mercedes and Range Rover are steeped in history
    - Europeans don’t grow up wanting a Cadillac, but a Porsche….
    - Brands like Lexus and Cadillac are based on cheap cars normally, but a BMW is a BMW.
    - Depreciation is less of a risk on a Jaguar than a Caddilac

    The truth is GM should have kept SAAB and killed off Caddilac in Europe. SAAB sold maybe 100,000 units vs Caddilac’s 1500. It’s not rocket science.

  • avatar
    Amendment X

    Every time I hear the name BLS, I think “Cadillac BLSH*T”. Maybe they could have spent a few extra of those marketing dollars on a decent name that carries a little pizazz.

    Take a page out of the Japanese and Korean playbooks… Launch good regular cars FIRST, THEN move on to luxury. Oh, and do this in America too, btw.

  • avatar
    Robert Schwartz

    “Susan Docherty, who spent four years overseeing the unabashed mediocrity that is the Cadillac/Chevrolet marketing effort in Europe”

    An insult to mediocre people everywhere. GM’s European marketing effort has been a failure. That is an F. Mediocre is a C, that is a passing grade. F is a failing grade. GM = F. Get used to it.

    BTW, the BLS is actually a nice looking car.

  • avatar
    psarhjinian

    Ciferri’s advice: forget Europe and try harder to sell Cadillacs to the Russians. Certainly GM’s experience with Chevrolet has been that US brands sell better in Russian than Europe. Part of the problem is certainly the issue of taste, although the ongoing Opel chaos hasn’t exactly endeared GM to the European market either.

    Most of the reason is that Chevrolets in Europe are much, much cheaper than Opels, and consumer spending power is lower in Eastern Europe. This was more or less a function of Chevrolet in Europe being a rebranding of Daewoo.

    Or, in other words, it’s a bottom-feeder brand.

    GM’s strategy was to move Opel upmarket so that Chevrolet in Europe wouldn’t have to rub shoulders with storied marques like Dacia or Proton. The problem with this is that you end up pushing Opel into Cadillac’s and (until recently) Saab’s space, cutting Opel off at the knees and rendering the BLS pointless.

    This is very much “Old GM” thinking: no idea of what brands are worth, no marketing, no thought beyond the current quarter. That they’re playing their old “suck up excess capacity” game with cars like the BLS is like iodine in the wound.

  • avatar
    NickR

    “Every time I hear the name BLS, I think “Cadillac BLSH*T”. Maybe they could have spent a few extra of those marketing dollars on a decent name that carries a little pizazz.”

    +1. 26 letters in the alphabet, that’s 17,576 3 letter combinations and BLS is the best combo they can come up with? I know the good ones are probably taken, but still…

  • avatar
    LectroByte

    Every time I see a Malibu LTZ, I say to myself Malibu Lutz? I LOL’d when I heard that BLS = Bob Lutz Special.

  • avatar
    Buckshot

    The luxurycar buyers in Europe are the most conservative bunch in the whole world.
    Lexus has tried for years, but they are still very small.
    I don´t think it´s possible for Cadillac to make it in Europe.

  • avatar
    riko

    I see the rare occasional Cadillac living here in France. Someone who lives not too far from me has a midnight blue STS and he even finds space to park it. And I ran across my mother-in-law’s former Coupe de Ville making a left hand turn in Geneva a couple of years ago. And I even once saw a BLS!

    There is a market in France for Cadillacs. First there are thousands of American cultural victims who walk around in cowboy boots looking like the Marlboro Man (and these dudes never speak a word of English). Then there are the anti-conformists who do not want to drive BMWs, Mercedes, or Audis like all their friends. Yes Caddies would sell here. The problem is the last time I looked there were only three dealers in all of France. God knows with a GM product you do not want to be too far from a authorized garage.

  • avatar
    Accazdatch

    Maybe its the massive chrome painted wheels that would bother a European customer..

    Or maybe it s the glue marks left over from the Saab parts inside and out…

    Is that why this POS wont sell?

  • avatar
    Phil Ressler

    Cadillacs are for continental countries: US, Canada, China, Russia, perhaps Brazil. That’s it. The EU remains a spilled jigsaw puzzle, its component entities too small to foster the swaggering psychology common to continental expanse. They wouldn’t understand. Leave Europe to the short-haul cars and the ever-delicate weeniemobiles.

    Phil


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