Editorial: Unrealistic Timelines At Cadillac
Readers of our departed EIC’s chronicles will no doubt understand that building a luxury brand is a gradual, concentrated effort that won’t bear fruit for many years. Over at Audi, it took Herr Schmitt and Herr Piech the better part of two decades to morph Audi from an oddball line of tarted up Volkswagens into a global luxury player, and that journey was not without its own mishaps.
Audi wasn’t the only one to trudge down that road either. Bob Lutz’s latest book recalls the genesis of the BMW naming convention (naming their cars the 3, 5 and 7-Series), arguably the start of their rise from, well, an oddball line of Bavarian built cars into one of the auto industry’s blue-chip luxury car makers.
So who is Uwe Ellinghaus, Cadillac’s new marketing chief (an ex-BMW man) to think that building Cadillac into a global luxury brand will take about 10 years? Cadillac’s main markets right now are America and China, with the two countries accounting for about 90 percent of sales. Even so, Cadillac is badly outgunned in America, with Mercedes-Benz and BMW (and Lexus as well) each doing roughly one-and-a-half times the volume that Cadillac does in its home market. In China, supposedly Cadillac’s second most important market, Audi is outselling Cadillac by roughly 10 to 1. In Europe, Cadillac is a non-entity, selling just 2,274 cars in 2012.
The idea that Cadillac will be a global player in the luxury car world in as little as 10 years is at worst a fantasy, at best a demonstration of profound ignorance. As a former BMW marketing exec, Ellinghaus should know that Cadillac lacks key products (like a small crossover, a proper flagship and diesel engines) needed to compete in the all important European market, and that competitors like Lexus have yet to crack the “global” part of the equation despite arguably having a higher profile in the luxury world.
The best summation of the entire situation comes from TTAC commenter edgett
This is American marketing at its worst. The idea that the content of the product is overcome, or recreated, at the hand of “branding” is how they got into this in the first place. What if the brand identity for Cadillac became “The Standard of the World”, and they spent all of their “branding” money on creating a product which epitomized that identity?
More by Derek Kreindler
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I don't understand the skepticism. BMW, Audi, Acura, Infiniti, and Luxus took 25 years to build luxury flagship brands because they couldn't build better cars than their current offerings at the time. Furthermore, the public perceived the brands as being vendors of slightly inferior cars. The marketers had to overcome public bias. Cadillac has the opposite problem. They built bad cars on purpose because they refused to accept shifts in the luxury marketplace. They have deep enough pockets to hire anyone they want. Most importantly, the public expects Cadillac to be the best, and most criticism aimed at Cadillac pertains to their lazy mediocrity. Cadillac's ambitions are reasonable.
Cadillac doesn't have the same ring as BMW, Mercededs Benz or even Audi. I would place it's allure with that of Volvo and Honda. GM need to invent a new product. They have the name HSV. The name is respected globally. The build quality is better than the average NA built vehicle. It also would be a reason to keep GM's operations in Australia as a highly value added product might be a little more viable to manufacture here. But, the reality is if GM can make it here, they can make it a low cost country and make more profit. Even prestige cars might move in that direction one day. The Europeans are already doing that. Where is the Porsche Cayenne made?