During media days for the 2017 North American International Auto Show in Detroit, I sat down for a chat with Johan de Nysschen, global president for the General Motors Brand Cadillac.
A native of South Africa, de Nysschen is known in the industry as a big game hunter. Not willing to bag a Reebok and claim success, de Nysschen always aims for Cape Buffalo, a highly regarded prize. His past leadership with Audi of America saw that company rise from near bankruptcy to prominence, and he also revamped Infiniti America’s product lineup, which led to sales increases for the Japanese brand.
In 2015, de Nysschen signed with Cadillac to lead the once-storied American brand back to quality and relevance in the luxury market after years of lagging sales.
Cadillac vehicles have long resonated in the African American community. Back in the day, if you did not have a Fleetwood Brougham or an “El Dog,” (Cadillac Eldorado) you just did not belong. American automakers Cadillac (and Lincoln) were seen as aspirational brands for affluent blacks. Well, the tide changed as luxury imports from Germany (Mercedes, BMW, and Audi) and Japan (Lexus and Infiniti) began to make serious strides among people of color.
Under the leadership of de Nysschen, Cadillac is steadily returning to prominence. Sales are up over the past two years, and the products they sell are now good enough to compete in global markets. Fleetwood, Seville, DeVille and El Dorado have been replaced with CT6, Escalade, XTS, CTS, ATS and XT5. BE asked de Nysschen about the glory of days and his vision for Cadillac’s future:
(Image: Caddy’s Global President Johan de Nysschen/Photo by Brian Armstead and Cadillac)
JdN: This is the best job in the world, and the opportunity to be at the helm of such an iconic, renowned, revered brand with an 115-year-old heritage actually is humbling, and it also impresses upon me the responsibility the team (his employees) and I have to be custodians of this brand and to nurture it back to what we loosely refer to as the “Pinnacle of Premium”–the point where Cadillac again, quite unequivocally, is the standard for the world. We have made tremendous progress in the space of two short years. We’ve mapped out a journey in terms of the rollout of the strategy that embraces the next 10 years. But this is a long-term program. We cannot expect to shape brand perceptions overnight, but we have an excellent starting place with the brand that is respected, enjoys high brand awareness and the current generation of Cadillac products are phenomenal, and there is so much more exciting in the pipeline.
BE: Let’s talk a bit about the whole process where you’re rebuilding the image of Cadillac. How do you pay homage to the good old days of Cadillac? In particular, how do you retain the loyalty of the African American consumer when there are now so many luxury brands to choose from?
JdN: I think firstly, I would observe that Cadillac, in the U.S. in particular, gave the European competitors the room to establish the foothold where now they lead the luxury market in this country. We have every intention of reclaiming what’s ours. If we look at the future, we quite clearly want to work on repositioning the brand and transforming the Cadillac brand as representing what we could describe as “Classical Luxury,” into a brand that represents “Progressive, Contemporary Luxury.” And this is by no means a quest to disassociate us from our past and from our heritage. We are extremely proud of our heritage. It is something that is ours and that we own. But if you are a brand that’s been around for 115 years, and you plan to be around for hundreds more, you must evolve with changing times. We live in a dynamic world. And particularly now, the auto industry is at a major inflection point. Not only from regulatory and legislative and technology influences, but also from the fact that the baby boomer generation that so dominated luxury car consumption for decades, has now for the first time been displaced by Generation X, and Generation Y as the dominating force in luxury consumption. And this is now going to accelerate. By 2020, four out of every five luxury cars will be bought by members of Gen X or Gen Y. And for them, we note, that they favor a more relaxed, casual contemporary expression of luxury. So in order to ensure that our brand continues to resonate and remains relevant to this audience, we have to work on the repositioning of the brand. And that must manifest itself in the product designs of course, in the product concepts. The way that we combine the tradeoff between dynamic performance and refined cocooning luxury, the marketing communication tone and manner, the experience at the retail level, and then most certainly, we need to look at the nuances and the distinctions we have with different demographic customer groups. I think that to some extent, one can claim that all luxury consumers, regardless of background, have certain desires and interests and tastes that are universal. That is fundamentally true, whether you speak of the American luxury consumer or the Chinese luxury consumer, they have a large degree of commonality. On the other hand, this should not be used as a reason to say that you do not have to direct marketing communication in particular, to particular communities. Because they do have different cultural backgrounds, different norms, they have different expectations and the brands with which they associate themselves should respect those. And so certainly, for Cadillac, it’s one of the competitive strengths that we have that we have historically resonated well with affluent members of the African American community. And we would like to continue to be the brand of choice. And we will continue to work very hard to maintain that position.
BE: You touched a bit on China. Last December, I spent three weeks in China looking at the auto industry as a guest of the government of China. I saw Buicks (another GM brand) and Cadillacs everywhere. I knew Buick had an extensive history in China as the last Emperor was driven in a Buick. I had not paid close attention to Cadillac’s numbers in this rapidly emerging market. Do you sell more Cadillacs in China than here in the U.S.?
JdN: Not quite. Cadillac is the fastest growing luxury brand in China. Last year we grew sales by a very impressive 45%. We have now very clearly established ourselves in the No. 4 position in the overall ranking of brands by sales volume in the luxury sector in China. And we have done that while we still have a relatively narrow product portfolio. So, imagine when 2020 rolls around and we have totally revised and expanded our current product portfolio what we’ll be able to do at that time. 2016 saw us achieve a total of just over 116,000 sales in China, by comparison in the U.S. we achieved just over 170,000, so the U.S is still our most important market. But I have to say, it is only a matter of time.
BE: Forty-five percent growth in a year. That’s pretty amazing.
JdN: The growth rate will probably begin to modulate a bit, but it’s inevitable. There will come a time when the size of the Cadillac business in China eclipses the U.S. What we must bear in mind, though, is that we should not measure the overall business only by the sales result. By virtue of the legislation in China, Cadillac and all other automakers have joint venture partners. And so, it means that you also share the business. You share the profits. Whereas in the U.S. of course, the pie is all ours.
BE: Cadillac’s sales numbers in the U.S. have been phenomenal since you’ve taken over the reins of Cadillac. There were a lot of naysayers who said you couldn’t do it, you couldn’t increase the sales numbers. What is the de Nysschen magic? What do you bring to the table that spurs these dramatic increases in sales no matter what company you’ve led?
JdN: Well I don’t know that there’s a magic de Nysschen formula. There’s a lot of luck involved. And part of that luck, I suppose, is about surrounding yourself with phenomenal, competent people. My role as an enterprise leader is to craft a vision for the business. And to then sit with a handpicked team of very capable people and develop jointly the strategy to execute that vision. I think it’s very important that one has a “North Star” behind which the entire organization can be aligned. You then kind of articulate the specific milestones or goals, and those need to be cascaded down right to the point where every individual knows exactly what their personal contribution is toward achieving the ultimate enterprise goal. They know how to contribute. They know what’s expected. They are empowered to make decisions—they don’t have to run everything up the flagpole. It’s an environment where if you want to have this agile, fleet-footed entrepreneurial approach, once people are clear on what the goals are, and what their role is toward achieving those goals, you need to set them free. And if you do that, you need to also be willing to accept that if you take risks, sometimes they won’t pay off. You, therefore, need to have a learning culture, where you learn from your mistakes. You cannot tolerate mistakes indefinitely, but if you accept the reality that everybody is pushing the envelope, sometimes things just won’t come off. You need to allow people the movement to take risks. Because if you don’t take risks, you’ll always be in the slow lane. And we don’t have time to be in the slow lane. And so for me, that is a formula I have found has worked. In previous assignments where the challenge seemed particularly daunting, and it’s a philosophy I do my best to also bring to the organization here at Cadillac.
BE: Let’s talk about the newest member of the Cadillac lineup. When I drove the all-new CT6, I wasn’t expecting it to be as good as it is. It has a European, crisp feel to it. The car’s road handling is phenomenal. You’ve won a lot of acclaim for the car—please tell us about the CT6.
(Image: 2017 Cadillac CT6/Photo by Brian Armstead and Cadillac)
JdN: The CT6 is an excellent example of this renewed focus that Cadillac has on what the brand stands for. And it’s one of the benefits that comes from now having a dedicated organization, with Cadillac as a separate division of General Motors, very much still a part of General Motors but we have dedicated resources that have 100% mindshare about Cadillac—we don’t have to worry about the other brands. And when you have that degree of focus, where everything is coordinated around and aligned around this North Star that I articulated earlier, you have the benefit that everything is coming together in a very sharp point of focus, very highly defined. Previously, when we had the approach where business was regionalized, brands were managed in different parts of the world in different ways, by different people, product development was corporate, marketing was brand specific, but there was no clear connection to the other functions, it meant that everybody in the company had very good intentions, and could express their own interpretations of what Cadillac stands for. This means that the engineers had one idea, the designers had a slightly different idea of what the brand represents, the marketers yet another one, the dealers yet another one, and the overall result—that all of these things contribute to help shape people’s perceptions of the brand—led to this kind of loosely coordinated, but not very clearly defined result of the expression of the brand.
So the overall brand perception then was the result of these well-intended but not tightly coordinated activities of a lot of smart people. The right way to do it is to say, “What does the brand stand for?” What does the brand stand for in terms of philosophy, and how are the brand values captured in the product concepts, in the designs, in the engineering, in the marketing communication, in the customer experience, so that brand drives the strategy and is not the result of a whole bunch of activities. It sounds very academic, but it’s extremely important. I refer to this because it explains the CT6. When you know that the brand stands for the central positioning around the notion of passion, which really is a metaphor for excellence, for pride, for perfection in execution, where there is almost fanatical attention to detail, where no item is too small to be overlooked. It’s about precision, craftsmanship, and sophistication. And you surround that then by our brand values. When you come to the discussion of how you capture that in an automobile, you say well “What is Cadillac?” It’s a luxury brand. It means that is must reflect advanced technology, sophistication, refinement, craftsmanship, precision, fit and finish—all of these things that define the luxury product concept.
BE: The Concept Escala was a major hit among the press at the recent North American International Auto Show in Detroit. The car is exceptionally beautiful. Will Cadillac build it in the near future?
(Image: Cadillac Escala Concept/Photo by Brian Armstead and Cadillac)
JdN: I’m extremely proud of what the team has done with Escala. It’s a precursor to Cadillac design. It’s a very clear statement of what future Cadillacs will look like. It represents the next generation of the “Arts and Science” design language. You will notice that it’s far more organic. It has toned down the very sharp “Origami” type edges to the car’s design. All future Cadillacs will begin to reflect this design philosophy. The overall look and feel of front-end and rear-end styling will begin to manifest itself even in the first crossover we will launch next year. When the current range of sedans reach the end of their life cycle, those too will begin to show Escala-like themes. As far as the chances for the production of Escala itself, I am afraid I have to confirm that likely will not happen, but that does not mean that we are not planning a very sophisticated, very advanced high-end flagship for Cadillac that I think will be even more stunning than the Escala.
BE: Current realities indicate you’ll have to move toward non-fossil fuel methods to power your vehicles. Please talk about the CT6 Hybrid and “green” technologies for Cadillac.
JdN: The CT6 Plug-in Hybrid is a good indication of one of the avenues we are going down. It’s a really stunning luxury car that’s also a performance car that can run in full Electric Vehicle (EV) mode to cover the average commute (about 30+ miles), and impressively, and it will remain in EV mode up to 78 mph before the gasoline motor kicks in to provide supplementary power. And of course, when you have these two, the gasoline and electric motor in tandem, you get phenomenal performance. So you can have an exhilarating luxury car, phenomenal performance, and full EV capability with 65 mpg-equivalent. If you look at that compared to the traditional way of unlocking that performance, you’ll never get that kind of fuel economy. So it’s fantastic technology with no compromises. We want to introduce that technology to our crossovers in the course of the next few years as we roll more out. But beyond that, we are planning full battery-powered electric vehicles as part of the long-term Cadillac portfolio as well. But again, in terms of the time horizon, we’ve got to get the core fixed first. And when Cadillac does a battery electric vehicle, it will be state-of-the-art with unique, dedicated architecture conceived from nothing else than an electric vehicle. So not trying to shoehorn batteries into a conventional architecture, but one that is conceived to take this brand into and beyond 2030. It will be the architecture that will be the basis for a range a whole portfolio of EVs in the long term.
BE: Thank you very much, Johan de Nysschen.
Automotive expert Brian Armstead has been involved in print, radio, and television for over 41 years. He is President Emeritus of the Washington Automotive Press Association. Got a new car question? Reach out to Brian at email@example.com, and follow him on Instagram and Twitter @roadgearsun