I don’t know if it will help them sell cars are not, but Cadillac’s decision to move it’s business headquarters to the trendy Soho district of New York City has certainly gotten some attention as have Cadillac marketing maven Melody Lee’s comments related to the move and the potential customers they hope to reach by making Cadillac into a more general luxury brand, not just a car company. When I saw that Lee’s boss, Jim Vurpillat, Global Marketing Director for Cadillac was going to be participating in a press event for the 2015 Chevrolet Detroit Belle Isle Grand Prix, because Cadillac has factory based teams running racing versions of the ATS in the Pirelli World Challenge, it seemed like a good opportunity to ask him how racing and the high performance V cars in Cadillac’s portfolio fit in with appealing to New York’s trendy set, a group not known for their love or horsepower or what they see as environmentally questionable motorsports.
Q. Where do motorsports and performance fit into Cadillac marketing? The people to whom you’re appealing by moving Cadillac HQ to Soho in NYC are not the same people who are drawn to high performance V cars and Motorsports.
A. The move realy isn’t about that. How we look at performance is that racing proves the performance credentials of the V series and the V series provides performance credentials to the overall Cadillac brand. So they’re intrinsically linked together.
Q. So you don’t see a conflict between that and making Cadillac into a fashionable luxury brand?
A. No because luxury by it’s definition is pretty broad. When you look at the luxury landscape you’ve got performance series like [BMW’s] M, [Mercedes-Benz’s] AMG, [Cadillac’s] and V series and you have a group of audience for that. You have things like alternative propulsion, electrification, so there are things like our ELR, [BMW’s] i cars, hybrids. You have to be very diverse and your portfolio has to be diverse.
The key though is that when you do a car, that it has to have really a sense of no compromise. So, with our V cars, especially the new ones that we’re releasing, they’re a great daily driver as a luxury car but then they’re certainly a track capable machine.
What we’ve seen since we’ve gotten back into racing in the last four years is that we’ve grown the enthusiasm for the V brand, not just among our owners, and dealers but there’s more and more people…
Q. Back in the early 1950s after Cadillac introduced the first modern OHV V8, Cadillac was all about performance and competed in the Panamerica races in Mexico.
A. That’s still the case today.
Q. Getting back to the New York move, don’t you think that motorsports and performance might turn off the crowd that’s attracted to the plug in hybrid ELR? Enthusiasts have the impression that New York is not a car friendly city.
A. No, I don’t think so. New York is the single largest market for luxury cars in the United States, it’s also the largest performance market. You have to remember that the greater metropolitan area includes Connecticut, Westchester County, northern New Jersey, down into mid Jersey and Pennsylvania, Long Island, so it’s huge. When you’re there and you drive around you see luxury cars everywhere, so I don’t think there’s a risk at all. With luxury buyers, one of the pillars of building a strong luxury brand is a strong performance element and it’s been an element that we’ve been lacking a little bit, trailing BMW and Mercedes and Audi.
So racing supports that, we’ve seen that enthusiasm. We like to use the V cars… When we did the first generation, when we did the first CTS-V, it shocked people. Then when we did the next generation CTS, people asked, “are you going to do a V?” Now, with the third generation CTS and the ATS, people are like, “Where are the Vs?” We said they’re going to come and now they’re here.
We’ve seen that progression of V and I think directly, racing, especially this last four years with the Pirelli World Challenge, we’ve seen that interest.
Q. What’s the return on investment? Does Cadillac track sales results from motorsports?
A. We measure all of our events so when we’re at a track, and we activate, like at the Detroit Grand Prix, and we ask for people’s names and information, we track who signs up at the booth and then we measure that in sales. I can tell you that it has a huge ROI. Racing is very strong. We oversell Vs as a percentage to racing fans but the number one vehicle that we sell to people who come to a racetrack is the SRX [crossover], which is our number one selling car in general.
Q. Crossovers are one area where Cadillac’s portfolio is weak.
A. We’re going to see an expansion of that. At the end of the day we see what racing is doing is showcasing to people Cadillac and Cadillac performance and then they’re going into a showroom and picking a Cadillac. And they walk away with something like an SRX or ATS, which is exactly what we want.
Q. Is there going to be a V version of the upcoming CT-6?
A. We’re discussing that. It won’t be a V series. We’re still building a brand, we think that at the core we have to be very tight with what what gets badged a V series. Some of our competitors are far more.. they’re expanding their AMG offerings at Benz. We think that as we build the brand we have to be very focused on what a V is. If the car or the vehicle can’t deliver that.. we get asked all the time “Why can’t we have a V series Escalade?”
Q. Cadillac has had some concept car hits with the Ciel and Elmiraj, and a brand can’t really be considered a luxury marque if it doesn’t compete with the big boys, the S-Class and 7 Series cars. If Cadillac really wanted to assert itself in the luxury field, why not build them? What could they cost, $125,000?
A. As you build a portfolio, you have to have a long term vision and you can’t stretch too far. You can always use this example: When we did the first generation CTS, everyone was like, oh my, a small, little Cadillac. Then five years later, when we introduced the next CTS we got, “When are you going to do a car smaller than the CTS?” and we brought out the ATS. If we had first come out with a car the size of the ATS it would have been too far.
You have to build out from the middle, then to [consider to] do a vehicle like the Elmiraj, to do a vehicle the four door [convertible] Ciel, but is it too far up here? Fill in your main segments first.
It’s no joke, between now and 2020, we’re spending $12 billion on Cadillac, our portfolio will be extremely added to in that time.
Q. You said we will not see an Escalade V, but there are credibly performing luxury SUVs and crossovers like the SRT Grand Cherokee, Audi AQ5, as well as the Porsche Cayenne and Macan. There’s clearly a market subsegment there. Since a lot of the growth in crossover sales are the result of the changing attitudes of female consumers who drive (no pun intended) about 80% of consumer purchases in general, is offering a performance crossover one way of appealing to men.
A. Performance cars are decidedly, when we look at Ms and Vs and AMGs you know it’s 90% male. When we get into the higher performance cars, like the M5, it’s about 98%. Women like the performance when they have it, it’s just different where they put the emphasis.
Ronnie Schreiber edits Cars In Depth, a realistic perspective on cars & car culture and the original 3D car site. If you found this post worthwhile, you can get a parallax view at Cars In Depth. If the 3D thing freaks you out, don’t worry, all the photo and video players in use at the site have mono options. Thanks for reading – RJS