By Jeff Bennett
General Motors Co. intends to invest more than $12 billion into
new Cadillac vehicle development over the next five years, paving
the way for the luxury nameplate to build eight new vehicles.
Cadillac brand chief Johan de Nysschen intends to disclose the
sizable investment strategy on Tuesday as he looks to stir up new
sales for the brand in the U.S. and China, which he termed as the
brand's "second growth hub."
Mr. de Nysschen, a former Nissan Motor Co. executive, was hired
in July 2014 to turn around Cadillac sales. The brand has been
losing market share, especially in the U.S., to foreign competitors
such as Daimler AG's Mercedes-Benz and BMW AG.
One of his first steps as president is to move Cadillac's
headquarters to New York from Detroit. He intends to have staff
relocate to temporary offices in New York in June, with permanent
offices for about 120 employees opening in September. The move is
designed to steep workers in the luxury trends found in a
cosmopolitan city like New York.
The $12 billion investment gives Mr. de Nysschen the fire power
he needs to expand Cadillac's portfolio and compete in some of the
"white spaces in China" where the brand doesn't currently
compete--such as in compact crossovers.
"Eight new products have already been approved," Mr. de Nysschen
said on the sidelines of the North American International Auto Show
in Detroit. "Five are all new and there are two more right on the
horizon and I am trying to pull [their introduction] into this
decade. At this moment they just squeak out on the other side."
He added that the focus with these new vehicles will be set on
China and rapidly develop the region as a "second volume hub" for
the brand. The first new vehicle, a full-size sedan called the
CT-6, will be announced in the next two months.
"That is what will afford us to develop all the cars we also
need to be successful in the U.S.," Mr. de Nysschen said. "There is
a huge lot of different consumers we need to address outside the
U.S. and here, the baby boomers which constituted our traditional
customer base are going to be important. But by 2020, 80% of the
luxury purchases will be by Generation X and millennials; we have
to cultivate the brand now."
Write to Jeff Bennett at jeff.bennett@wsj.com
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