Repair-It

For example, de Nysschen had a couple theories that explain why sedan sales are on the decline in the U.S.

“It’s partially happening because of energy prices, where people are less focused on fuel consumption and sedans being lighter,” he said. “But also it’s been driven now by the entry of younger consumers who really are less tuned into dynamics and handling and all of those things that used to excite enthusiasts. It’s more about the way cars complement and enable their lifestyle now. And candidly, I also have to say it may also be influenced a little bit by the decay of America’s infrastructure. When roads no longer support high-performance sport sedans and ultra-low-profile rubber, people are going to respond to it.”

Thankfully, he also doesn’t see Super Cruise turning future Cadillacs into autonomous transportation pods.

“For us, it would make no sense to spend all the time, resources, and, candidly, money to put all this dynamic substance into our cars—our cars are fantastic to drive, they are rewarding, they’re exhilarating, they’re comfortable, luxurious, refined, but they’re also performance cars—to put all of that capability into the vehicle and then remove the option of driving,” he said. “That would be absurd. For us, luxury is about having the freedom to choose. And a Cadillac personal autonomous vehicle will have autonomous capability, it will allow the driver the opportunity to drive themselves and enjoy a finely crafted automobile, but when the mood takes them or the circumstances dictate, they can let the car do the onerous part of driving for them. That is the longer-term timeline, the horizon view for Cadillac.”

“V in the future will continue to play a very important part in terms of creating this halo brand cachet around Cadillac,” he said. “We are a luxury brand, but we are also about producing exhilarating driver’s cars, and nowhere is this more clearly brought to bear than in V. Not all Cadillacs will feature Vs [in the future], but certainly a far broader part of the future portfolio will see this sport and V-Sport execution.”

Although Cadillac’s racing efforts are still focused on the U.S., its sales efforts are now focused on China. Cadillac recently finished building a new factory there, and from the sound of it, the investment is already paying off. Even though U.S. sales were down 8.0 percent in 2017, a 50.8 percent sales increase in China meant Cadillac saw an overall increase of 15.5 percent

“The Cadillac plant in Shanghai is, in fact, the most modern General Motors plant in the world, and it’s highly automated,” he said. “For us, the investment into this state-of-the-art plant in China has given us the ability to kick-start a very wide range of product offerings at very competitive prices because we could circumvent the various tariffs that are applied to imported vehicles. But it also really forces you to focus. If you have that kind of investment into fixed costs and structural costs, you better make sure you develop the volume really quickly to support it.”

However, that doesn’t mean Cadillac plans to build cars that are exclusive to the Chinese market. According to de Nysschen, it’s not necessary.
“Generally, luxury car consumers the world over are savvy people,” he said. “They’ve had their perceptions and opinions shaped by the fact that they are well traveled. But even if they aren’t, the world is a global village nowadays. Everybody has access to information. It shapes people’s wants, desires, and tastes. There are some specifics that are different, like colors, trim, and some feature content. But predominantly, what drives a luxury car consumer in China and Europe and the United States is not that disparate.”

“I think this will be determined by a number of considerations,” he said. “One of the things that we have to consider is that if you export from China, whatever you produce and export there you share with a partner. So it would have to be a product with a pretty compelling advantage to be financially more attractive than building the car locally. More likely you would do this for entries that are relatively low volume, that are required for the Chinese market in the first place, that might be interesting for export markets but where the volume opportunity is just too limited to develop tooling. The second scenario would be where you have surplus capacity in China and you’ve got greater demand in other markets that you are unable to supply with your U.S. manufacturing base. So it’s incremental.”

Cadillac has had a full stable of cars in a world increasingly migrating to crossovers and SUVs and pickups. Some of those cars have not performed well, and de Nysschen was reluctant to use heavy incentives in a bid to increase their overall residual value.

When Cadillac moved to New York and began to separate itself financially, the goal was to have Cadillacs on unique platforms. But de Nysschen came up against the reality that commonality with other GM brands is often necessary for new products to be financially viable. It is a compromise he was more willing to make with crossovers than with cars.

The brand has adopted a “Y strategy” that starts with a luxury-spec car and can go in one of two avenues: upgrade the luxury content to make it more sophisticated or branch off into a sport personality. “You might have two cars at similar price points but of a different content,” de Nysschen said.

On the utility side, the profit generator has been the full-size Escalade SUV, a body-on-frame beast that is well into its life cycle. It is up against a shiny new Lincoln Navigator that has received strong reviews and forced Ford to increase production to keep up with demand.

The next-generation Escalade is not due until 2021. “The next Escalade’s gonna blow you away,” de Nysschen had promised. It will remain body-on-frame and keep the Escalade name, having built a large and loyal customer base that dealers will have to entice to keep from running to Lincoln.

He became president of Cadillac in August 2014 after running the Infiniti brand for Nissan. Before that, he led Audi in North America.