Will de Nysschen take Caddy into small cars?

Johan de Nysschen is barely a week into his new job as president of Cadillac. It will take some time to learn what he will attempt to do there.

But keep your eye on the small-vehicle end of the luxury spectrum. That will be de Nysschen’s most likely play for the American premium king.

As the global leader of Infiniti for the past two years, de Nysschen made clear and compelling arguments about the direction of the world premium market. His assessment of luxury can’t be different for an aspiring Japanese manufacturer than for an iconic American brand.

Here’s what he said a few months ago as president of Infiniti in a conversation about the future of premium:

“We have to consider the evolution of markets. There is a strong component of young people that are beginning to enter the market. By the end of this decade, 80 percent of sales in the premium sector will be to the millennials.

“All the manufacturers are reading the same tea leaves and coming to the same conclusions. That is why BMW has chosen to go down that route with Mini and now 1 series. Audi has gone in with the A1 and the Q1. The whole idea is to begin to position cars with premium brand attributes at price points that are more accessible for these newly empowered premium shoppers, who can’t afford the rest of the range. The theory is supposed to be that they enter brand and migrate upwards.”

He acknowledged that Infiniti needs to follow Audi, Mercedes-Benz and BMW into smaller cars and specifically 1-series territory. But it was a visible frustration for de Nysschen that Infiniti first needed so many other products in new segments in order to establish its legitimacy in the luxury world.

Infiniti needed “recognition.” And to get that, more than anything else, Infiniti needs a truly luxurious four-door car, de Nyscchen argued. And at the same time, it needs a bona fide luxury-class racer that can turn the heads of wealthy, Formula One-oriented consumers.

Cadillac doesn’t have those problems.

Cadillac might well need some nip-and-tuck to restore its grandeur. But a lack of legitimacy is not Cadillac’s problem. The world is already quite familiar with the Cadillac name.

So as a result, Cadillac is relatively unencumbered with high-end product wants. Cadillac’s greater opportunity will be to prepare for and welcome that new wave of young customers de Nysschen spoke of -- the new millennial buyers who will soon want to take their first step into luxury with a respectable starter car -- a small Cadillac crossover, a B-segment Cadillac hatch, an A-segment Cadillac.

Somewhere there’s a Cadillac owner reading this and choking on the idea.

Just a few years ago, it would have been a Mercedes owner doing the choking. Now Mercedes is shaking up the world with its modestly priced CLA. And in 2018, Mercedes will begin marketing a trio of new luxury compact models out of a factory in Mexico that it will share with Infiniti.

For de Nysschen at Cadillac, the question won’t be “whether” he should take Cadillac in that direction. His challenge will be doing it in such a way that new small cars wear the Cadillac crest proudly.

You can reach Lindsay Chappell at lchappell@crain.com



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