AutoNews: Dealers Say Cadillac Must Continue Product Cadence

[megeebee]

Dealer: Family of CTS vehicles would boost sales

Automotive News | February 8, 2008 - 2:00 pm EST

Cadillac must continue product development and strong marketing to keep its renaissance alive. The brand also must whittle down the number of dealers it has to compete with luxury import brands.

Cadillac struggled with its U.S. car sales in 2007 totaling 131,192, down 8.1 percent from 2006. Much of that decline was due to dealers waiting until late fall for the arrival of the all-new CTS. On the truck side, the Escalade sold well despite steadily rising gasoline prices. Overall in 2007, Cadillac had 214,726 sales, down 5.4 percent from 2006. To boost sales, dealers will need a family of CTS products, said Daniel Jobe, divisional co-chairman for Cadillac with the General Motors National Dealer Council.

Most Cadillac dealers remain profitable, Jobe said, but for that to continue, Cadillac has to consolidate the number of dealers it has. Jobe spoke with Staff Reporter Jamie LaReau.

Daniel Jobe
Age: 48

Dealer since: 1990

Dealership: Capitol Cadillac Co., Greenbelt, Md.

Average monthly sales: 38 new, 32 used

Dealer council's top concern: Getting new products

Quote: "I don't want you to think profitability is OK. There's always room for improvement, but compared to other domestic brands, Cadillac has to be near the top."



What are your goals for 2008?

Product, product, product. We continue our discussions with Cadillac regarding new product, and we've got a number of things that are currently being considered.

In the fall of 2008, we're expecting the new launch of the CTS-V, which will be available in manual, and our new automatic for the first time on a CTS-V. We're all looking forward to that; it'll broaden our market substantially on that car.

What is lacking in the lineup?

There has been a lot of conversation regarding new models; a CTS coupe and a CTS wagon are something there's been a lot of talk about; a new entry-level sedan that would come in below the CTS.

These are all things we're pushing for and had a lot of conversation about. There's even talk about adding a smaller crossover to the Cadillac lineup.

The 2007 Escalade is still hotter than heck and keeps on rolling. If all goes well, at this time next year we should have the Escalade hybrid.

Do a lot of Cadillac customers inquire about hybrid variants?

There has been some interest in hybrids. I think the consumer expects Cadillac to be one of the leaders in the hybrid marketplace, and certainly the 2009 Escalade hybrid will be a big step in that direction. But we need to fill the void in the sedan side and the crossover side as soon as we can.

Modernista is now full speed ahead as Cadillac's new agency. What's your opinion of the ads it is doing?

I think the new CTS campaign has been an overwhelming success. The dealer body has been very responsive. With the success of the CTS launch and the new campaign that Modernista has put together, it's probably something that will drift into use for the rest of the Cadillac lineup.

Is the advertising attracting your target buyer?

One of the beauties of the new campaign is it seems to be appealing to the broad spectrum. We're seeing more imports being traded on Cadillac today than probably ever.

What about the BRX — a small, five-passenger crossover — that Cadillac is considering? How would that be better than the SRX?

I don't know whether the name has been determined or if the product has been finalized, but we need to push for a smaller crossover than the current SRX. We need something smaller in length that doesn't offer a third-row seat but does offer the cargo space behind the second row.

How profitable are Cadillac dealers?

I would imagine they are some of the more profitable dealers inside GM. I don't want you to think profitability is OK. There's always room for improvement, but compared to other domestic brands, Cadillac has to be hear the top.

Does Cadillac have the right number of dealers?

There are always too many dealers. There are about 1,500 Cadillac dealers.

I don't know what the exact number of Lexus dealers is, but it's about 300 or 400, so that should answer the question.


SOURCE: http://www.autonews.com/apps/pbcs.dl...plate=printart

[MCGARRETT]

Comment from Mgusecuro in 5......4.......3.....2......

[Sal Collaziano]

How does too many dealerships hurt? Is money the issue? The cost? It IS pretty odd that Lexus does so well with a third of the dealerships... That must save them a lot of money..

[lam]

Originally Posted by megeebee

What about the BRX — a small, five-passenger crossover — that Cadillac is considering? How would that be better than the SRX?

I don't know whether the name has been determined or if the product has been finalized, but we need to push for a smaller crossover than the current SRX.

.


SOURCE: http://www.autonews.com/apps/pbcs.dl...plate=printart

The guy doesn't even know about what product he is getting next year,hell he doesn't even know that the SRX is getting killed next year. GM isn't considering the BRX,BRX has been planned ever since 2005 by GM.

[jkennedy293]

I think the BRX should keep people coming to caddy dealerships. I think a mild-performance improvement for the STS is needed to keep that car relevant.

[lam]

Originally Posted by jkennedy293

I think the BRX should keep people coming to caddy dealerships. I think a mild-performance improvement for the STS is needed to keep that car relevant.

GM has other plans for the STS, it will be merged with the DTS.

[Sal Collaziano]

Originally Posted by lam

GM has other plans for the STS, it will be merged with the DTS.

Right. And it won't even be called STS.

[MCGARRETT]

The death of the SRX has been and on again and off again thing, I would not consider it dead yet, especially since higher MPG requirements are comming up, a re-designed SRX that looks a little better with a 6 speed auto and choice of DI 3.6 and 2.9 diesel could go a longway to helping Cadillac's overall MPG.

[Sal Collaziano]

Originally Posted by MCGARRETT

The death of the SRX has been and on again and off again thing, I would not consider it dead yet, especially since higher MPG requirements are comming up, a re-designed SRX that looks a little better with a 6 speed auto and choice of DI 3.6 and 2.9 diesel could go a longway to helping Cadillac's overall MPG.

You really have to wonder why they'd get rid of it at this point with the gas situation and all.. All they need is to give it more of a Provoq look, and it'll be a hot seller.

[megeebee]

Originally Posted by Sal Collaziano

You really have to wonder why they'd get rid of it at this point with the gas situation and all.. All they need is to give it more of a Provoq look, and it'll be a hot seller.

The SRX never sold to the level Cadillac wanted or needed. It is very heavy, and probably takes some sales from the Escalade, not that the Escalade is doing poorly. The question is plant capacity. The SRX is built on the Sigma platform. Only one factory on earth can build Sigma product. With the new CTS sedan doing so well, and the two variants coming (coupe and wagon), it doesn't make much sense to reserve a place for the SRX.
The production version of the Provoq concept (what ever they decide to call it), will take the place of the SRX and probably sell better. All the competition's similar product, Lexus RX, Acura MDX, Lincoln MKX, are all FWD/AWD vehicles and all sell better than the SRX.
Add to this the fact that the SRX has had only an interior upgrade in its nearly 5 years on the market. For sales of about 15,000 per year, I think GM decided it wasn't worth the incredible investment required to design a new one.

It's sad, yes. The SRX is excellent. But if the sales aren't there then it can't stay.

[megeebee]

Originally Posted by lam

The guy doesn't even know about what product he is getting next year,hell he doesn't even know that the SRX is getting killed next year. GM isn't considering the BRX,BRX has been planned ever since 2005 by GM.

My thoughts exactly.

Believe me, sometimes the dealers are the last to know these things. Mostly because their main interest is selling what they already have. Automakers are often closed lipped with dealers for the same reason. They want their dealers to order and sell what is in production today, and let the future take care of itself. My first job was at a Cadillac dealer, and the owner used to say this.

[megeebee]

Originally Posted by MCGARRETT

Comment from Mgusecuro in 5......4.......3.....2......

[MCGARRETT]

You would'nt be for keeping the SRX around as an X5/ML fighter?

[megeebee]

Originally Posted by MCGARRETT

You would'nt be for keeping the SRX around as an X5/ML fighter?

Oh I'd love it.

But look. US sales of the Germans is:

X5 - 35,202

ML - 33,879

SRX- 22,543

Also, remember the German vehicles enjoy a reputation and sales of these all over the world. The SRX has been a complete non-starter outside the US.

I would keep the SRX, yes. Update and improve it. It's one of my favorite vehicles, believe me. But I do understand the situation for Cadillac.

Lexus RX - 103,340

Acura MDX -58, 606

Lincoln MKX - 37,953

Now the Asian brands and Lincoln are lower in price point than the SRX and not the same kind of vehicle. As you say the SRX competes mostly with the performance oriented, RWD German product. But since sales are not fantastic, and they can build a very good competitor to the smaller, lower priced vehicles, I can see where it makes sense. Spending huge amounts of money to design a new SRX to compete for only 30-40K in yearly sales doesn't pencil out for GM right now.


Source: Automotive News Data Center. Sales for Calendar year 2007.

[mgescuro]

Originally Posted by megeebee

tick tick tick tick tick....