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Brand chief de Nysschen wants 'tension'; he'll get it from dealers.
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January 18, 2015
By: Mike Colias


With industry light-vehicle sales soaring toward 17 million and transaction prices at record highs, the dealer-factory meetings set for this week in San Francisco threaten to break out into hug fests.

Probably not at Cadillac, though.

Cadillac dealers are stinging from a seven-month sales slump. Many are still chewing through a glut of 2014 vehicle inventory as rival brands trot out enticing lease deals on their '15s. More than a few dealers missed their lucrative fourth-quarter factory bonus payments, which require year-over-year sales gains.

Dealers shouldn't expect soothing assurances of a short-term turnaround from Cadillac chief Johan de Nysschen when they attend the brand's make meeting this weekend at the National Automobile Dealers Association convention. He's not predicting a sales rebound anytime soon.

"I expect that the dealers will not be happy," de Nysschen said last week on the sidelines of the auto show here.

It was a cheerier backdrop at his first meeting with dealers in September, a month after he took over as Cadillac president. De Nysschen spoke of tighter production and better pricing discipline, key milestones along a "journey" to create greater exclusivity for Cadillac and return the brand to prominence. Many attendees left inspired.

But with no relief in sight from the sales malaise, reality is setting in that not all dealers will necessarily have the stomach for the ride ahead.

Full article available at link.
 

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Prediction:

Some of the 929 Cadillac dealers in the United States are going to close their doors.

Which, if these sales and de Nysschen's comments about sales not rebounding are true, then as much as I hate to say it, it isn't a bad thing. Some dealerships are better off cutting their losses now instead of dying by 1,000 cuts.
 

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Our Cadillac dealer here in Albany, NY (Otto) built a new dealership building a couple years ago and since have barely had any stock out front. It's really unfortunate to drive by and only see half a dozen new cars out front. I have no idea if they have more behind the building but still...

If I were cross shopping between Otto and Keeler (the BMW/Mercedes dealer here) I wouldn't give Otto a second glance because Keeler has at least 100 new models on the lot and even more used.
 

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Prediction:

Some of the 929 Cadillac dealers in the United States are going to close their doors.

Which, if these sales and de Nysschen's comments about sales not rebounding are true, then as much as I hate to say it, it isn't a bad thing. Some dealerships are better off cutting their losses now instead of dying by 1,000 cuts.
He wants a big part of those dealers to close the doors. A big part of those dealers are terrible, they are not even good enough to sell Chevrolets. Sad, really.
 
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He wants dealers to cut the number of days stock to be cut in half but raises prices ahead of the mandatory inventory cull. This is a very significant headwind for the dealership body.

Making utopian promises (without any detail) in a previous meeting is management 101 (you - the unsuspecting dealers - will make all the sacrifices. Me? Not so much). Then when the detailed plan hits and the dealers realize, "Hey, that's my blood on the floor, not anyone else's," the aforementioned tension will certainly arrive. Just as requested, apparently.
 

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I would be concerned if I was a Cadillac dealer. If you look at all of the unrealistic promises and expectations Cadillac chief Johan de Nysschen has made, you have to wonder were Cadillac will really end up. He sounds like a liberal politician running for office.
 

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He wants a big part of those dealers to close the doors. A big part of those dealers are terrible, they are not even good enough to sell Chevrolets. Sad, really.
I think the small boutique dealers will be the ones LOST and the BIG MEGA MART dealers owned by those national brands will survive and I would think you would want the opposite to happen
 

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It would be very nice to read something positive from the automotive and non-automotive press with regards to Cadillac. It has been a long time hearing any inspiring news regarding America's premier luxury brand.
 

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He wants dealers to cut the number of days stock to be cut in half but raises prices ahead of the mandatory inventory cull. This is a very significant headwind for the dealership body.

Making utopian promises (without any detail) in a previous meeting is management 101 (you - the unsuspecting dealers - will make all the sacrifices. Me? Not so much). Then when the detailed plan hits and the dealers realize, "Hey, that's my blood on the floor, not anyone else's," the aforementioned tension will certainly arrive. Just as requested, apparently.
Well, they didn't really build that. Someone else built that.

I would be concerned if I was a Cadillac dealer. If you look at all of the unrealistic promises and expectations Cadillac chief Johan de Nysschen has made, you have to wonder where Cadillac will really end up. He sounds like a liberal politician running for office.
As Sox points out above, positioning the inventory-reduction/price-raising events backwards is SOP for a politician who makes plans and promises without necessarily being connected to the reality of how those events play out.

It would be very nice to read something positive from the automotive and non-automotive press with regards to Cadillac. It has been a long time hearing any inspiring news regarding America's premier luxury brand.
TAILFINS!
 

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He wants a big part of those dealers to close the doors. A big part of those dealers are terrible, they are not even good enough to sell Chevrolets. Sad, really.
And that is exactly the problem with our dealer here. It is a combined Chevy/Cadillac dealership and some of the people selling the Chevy's are barely able to put a cogent sentence together let alone be dressed and informed well enough to sell Cadillac. The other two Cadillac dealerships are combined Buick/Caddy and Chevy/Caddy stores and they are half-way decent.
 

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And that is exactly the problem with our dealer here. It is a combined Chevy/Cadillac dealership and some of the people selling the Chevy's are barely able to put a cogent sentence together let alone be dressed and informed well enough to sell Cadillac. The other two Cadillac dealerships are combined Buick/Caddy and Chevy/Caddy stores and they are half-way decent.
Same here. Every luxury brand except Cadillac has its own dealer
 

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Prediction:

Some of the 929 Cadillac dealers in the United States are going to close their doors.

Which, if these sales and de Nysschen's comments about sales not rebounding are true, then as much as I hate to say it, it isn't a bad thing. Some dealerships are better off cutting their losses now instead of dying by 1,000 cuts.
Except each one of those Cadillac stores is someone's small business, they aren't going to just close their doors, they may fly a competitive banner, no longer selling Cadillac's, but they aren't going to just close.

I'm sure many have already been inquiring and looking for alternative luxury options.
 

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I think the small boutique dealers will be the ones LOST and the BIG MEGA MART dealers owned by those national brands will survive and I would think you would want the opposite to happen
Good point.

You are right, this will create a problem for Cadillac as BIG MEGA MART dealers are the last place you want buyers to have to go when you are trying to build a new image for Cadillac.
 
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