The Cadillac caper: Brand claimed Lincoln's sales crown in '98; but the figures were phony
John K. Teahen Jr. is the senior editor of Automotive News.
It couldn't happen, but it did. Cadillac was so determined to retain its crown that it lied about its December 1998 sales. Lied just enough to apparently beat Lincoln by 222 units for the year — 222 sales out of more than 360,000 for the two brands.
Sure, Cadillac admitted its "mistake" in May 1999, but who cared? It was too late for Lincoln to capitalize on its victory. "Oh, by the way, we were the leading seller of luxury cars last year." And the media's likely reply: "Now, you tell us. What do we care? That was months ago."
Nevertheless, it was one of the darkest events in General Motors' history. Maybe not as dark as the inept shadowing of Ralph Nader in 1966, but certainly on a par with the secret engine switch of the mid-1970s and the boardroom revolt of 1992 that unseated the chairman, president and several other high officials.
Sales numbers are sacred in this industry. You simply do not lie about them; you do not doctor them.
Cadillac ignored those tenets. Why do I say Cadillac lied? GM and Cadillac employ many expert sales statisticians, people who probably can predict any nameplate's sales within single digits days before the results for any period are announced.
Resign, Crain says
I'm sure that some of those number crunchers were disturbed by the Cadillac figures that were laid upon them. A source close to the inner workings of GM told me: "Sure, there were questions. The questioners were told, 'Those are the numbers. Don't make waves.' "
Keith Crain, publisher of Automotive News, was incensed. He called for the resignation of John Smith, Cadillac general manager. "Smith is a nice fellow and a likable chap," Crain wrote in his May 17, 1999, column. "But on his watch, Cadillac committed an outrageous lie. Others may be equally culpable, but whether or not he knew about it at the time, the person at the top is responsible."
Smith apologized to Lincoln Mercury President Mark Hutchins. But Lincoln had prepared a major advertising campaign to mark its victory, built around the theme, "We're No. 1." Naturally, the ad campaign was canceled.
What exactly did Cadillac do? It reported sales to dealers as sales by dealers. Cadillac had been reporting dealer deliveries of 12,000 to 18,000 vehicles a month in 1988. In December, it reported 23,861.
The phony figures gave Cadillac 187,343 sales for 1998 to Lincoln's 187,121. Cadillac's actual tally was 182,570.
'Hold me responsible'
Smith now is GM's group vice president of global product planning. He was asked to recall the 1998 incident for this report.
Smith acknowledged that "it's never been a particularly happy reflection on my part to know that the team I was presiding over" did those things. He concluded: "It happened on my watch. Hold me responsible, and don't be trashing anyone else, just trash me."
The 1998 campaign was the last time Cadillac and Lincoln have paced the luxury class. Mercedes-Benz led in 1999, and Lexus took over in 2000. Lexus now is posting the kind of numbers that Cadillac put on the board in its heyday: 300,000 plus.
You can reach John K. Teahen Jr. at firstname.lastname@example.org.