The Rise And Fall Of Cadillac

Irene Kim: Owning a Cadillac in America

was once the ultimate status symbol,

synonymous with success and achievement.

The company dominated the market,

outselling all luxury automakers in the US for decades.

Just 40 years ago, nearly one-third

of all luxury cars sold in the US were Cadillacs.

Now, less than 7% of luxury cars

purchased by Americans are Cadillacs,

and the company is struggling

to keep up with competitors it once outsold.

So, what happened?

Cadillac got its start in 1902.

It was actually formed from what was left

of the Henry Ford Company after the departure of Henry Ford

following disputes with his investors.

Engineer Henry M. Leland was brought on

to appraise the company's factory in order to sell it

but instead saw potential.

Leland chose to reorganize the company

as Cadillac Automobile Company,

naming it after French explorer

Antoine de la Mothe Cadillac, the founder of Detroit,

which was America's automotive hub

as well as the home of the company.

At face value, Cadillac's cars seemed almost identical

to those the company produced under Ford.

But they quickly distinguished themselves

and gained a reputation for being

better made and more reliable.

In 1909, the company was purchased

by up-and-coming conglomerate General Motors

and officially named its most prestigious division.

Over the next few decades,

Cadillac set huge milestones in the auto industry,

including the first passenger car

with a fully enclosed cabin.

Perhaps most impressive was the development

of the first electronic self-starter.

Up to that point, starting a car

required the awkward and strenuous task

of cranking up the engine.

With some help from inventor Charles Kettering,

Cadillac simplified it to just the push of a button.

Breakthroughs like this inspired the company

to adopt its iconic slogan:

"Cadillac: Standard of the World."

Fast-forward to 1927.

Cadillac established the concept of a luxury car

with its LaSalle convertible coupe.

Before the LaSalle, cars were strictly created

based on their engineering needs.

With this new car, it was the first time a company

called in a designer rather than an engineer for the job.

Designed by car stylist Harley Earl

to be lavish and eye-catching,

the LaSalle became a trendsetting automobile

that once again highlighted

Cadillac's high standards for car-making.

Cadillac's success and technical progress

continued through the 1930s.

But then World War II hit,

and the entire car industry slowed production

in order to produce tanks and aircraft engines.

But that didn't stop the car brand.

Cadillac introduced designs that came

to both define the car industry

and embody the prosperity of the "fabulous '50s" and 1960s.

While the company received recognition

for its continued engineering developments,

it was Cadillac's iconic tail fins

that became a staple feature of all luxury automobiles.

Not to mention its cars' enormous dimensions

and Dagmar bumpers, nicknamed after the voluptuous TV star.

At the height of its popularity,

Cadillac was selling over five times

that of rival Lincoln,

and in 1968 managed to sell

over 200,000 vehicles for the year.

But Cadillac was more than just America's most stylish

and top-selling premium car brand.

Through General Motors' aggressive marketing,

driving a Cadillac became a status symbol in America

to everyone from celebrities and professional athletes

to presidents.

Matthew DeBord: It was the pinnacle of achievement

in American society at that point.

They also have had these zany names,

like Fleetwood, Eldorado.

They came up with these crazy, crazy names,

you know, drawn from the most pretentious notions

around European heraldic badges and stuff like that,

and the whole idea was to sell people

on the notion that they had really made it

and they were gonna ascend to some kind of

premium status in American society.

Kim: At the start of the 1970s,

Cadillac remained the dominating force

in the luxury car market,

as the idea that "bigger is better"

still rang true with buyers.

However, as the economy declined

and a widespread oil crisis spread,

owning giant, gas-guzzling sedans

became far less convenient

and far more expensive.

But more than anything, the rise of imported cars

gave Cadillac some serious competition,

and the brand started to lose ground

as the standard of excellence in America.

DeBord: When the Europeans showed up,

the Germans in particular,

with their snazzy little sport sedans, it was a revelation,

and a lot of people who, you know, liked to drive

gravitated toward those.

And they were gonna go for Porsches and BMWs

and Mercedes and that sort of thing.

And they also started to think about

European automobiles as just being better,

them being superior.

And then the Japanese arrived

with their little fuel-sipping machines

that're, you know, really quite reliable

relative to American cars.

And so people started looking at these and saying,

"Well, it's a better car, it gets better fuel economy.

Why am I driving around in this giant Cadillac?"

Kim: Although the 1980s started well enough for Cadillac,

with sales continuing to increase,

the company responded poorly to this rise of imports.

To compete with all the new compact foreign automobiles,

the company began downsizing its entire lineup

to create a team of smaller, fuel-efficient cars.

But its cars quickly became indistinguishable,

not only from each other,

but from General Motors' other brands as well.

Cadillac owner: The black Cadillac, please.

Valet: Right away, sir.

Buick owner: Excuse me, I believe that's my Buick.

[laughs nervously]

Cadillac owner: Yes, so it is.

Kim: And as the company hastily pushed out

these smaller cars to try and match

the influx of luxury imports,

Cadillac encountered a number of failures,

the prime example being the Cimarron,

the smallest car Cadillac had ever produced to that point.

It sold so poorly that it was axed from their lineup

by 1988, just six years after its launch.

DeBord: It's a Chevy with a Cadillac badge slapped on.

It looks like a Chevy.

It's just a ghastly little car.

I mean, if you wanted a Chevy, it was OK.

But if you wanted a Cadillac, you looked at it

like, "What the F is this," basically.

So it was just an embarrassment.

But it was an attempt by, you know,

General Motors and Cadillac to keep the brand going

in a much more competitive environment

where some of the value proposition

of Cadillac had gone away.

Kim: Consumers recognized the decline

in quality of Cadillac's cars,

and it reflected in the company's sales.

Cadillac's share of the US luxury car market

dropped from 31% in 1980 to just 22% in 1990.

As Cadillac fell, its competitor

Lincoln reaped the benefits.

Lincoln's share doubled

during the course of the decade to 20%.

And in 1998, for the first time in 59 years,

Lincoln outsold Cadillac.

By the 1990s, Cadillac lost any appeal

it had with the younger market.

The running joke became that all Cadillac owners

were somewhere between 60 and death.

America's luxury car market

was now heavily dominated by Mercedes,

with Toyota's newly introduced Lexus brand close behind,

followed by BMW, whose sales were quickly rising.

But in 1999, the introduction of what would become

one of Cadillac's most iconic vehicles

would prevent a total collapse and help revamp the brand.

The 1999 Escalade was Cadillac's answer

to the full-size SUV boom

and its response to the success of Lincoln's Navigator.

The Escalade not only performed well sales-wise;

it became a pop-culture icon in itself,

making its way into movies and music videos,

as well as becoming a popular choice

among celebrity car buyers.

Things were starting to look up.

Cadillac saw a bump in sales,

a rise in popularity with the youth market

thanks to the Escalade, and somehow survived

General Motors' 2009 bankruptcy

that saw multiple brands dissolve.

Unfortunately, the 21st century

has not been completely kind

to the once glorious name of Cadillac.

While Cadillac's array of modern sport sedans

and performance models has been well received

by reviewers and the media, the numbers say otherwise.

In 2018, the brand saw its US luxury car market share

dip to a lowly 7%,

selling only 154,702 cars that year,

which put it behind even Acura.

And its sales among American buyers

only continue to plummet.

But why? How does a company that continues

to churn out high-quality cars with top-level technology,

like its self-driving Super Cruise system,

continue to dip in sales?

Well, Cadillac took a long time

to join the crossover SUV craze,

something that now makes up 60%

of luxury car sales in the US.

But despite its problems in the US,

the company may have found its answers

in the global market, particularly in China.

DeBord: The US market is at

peak levels right now as far as sales,

so there's not a whole lot of additional room for growth.

And you say, "Wait a minute, where are we gonna see

all the growth in the future?"

And General Motors looks, you know,

across the ocean and sees China,

whose market is already much larger than the US market,

you know, in excess of $20 million in annual sales

and could probably go to $30 million

or $40 million eventually.

People don't have a lot of cars in China.

And General Motors is looking at this situation

and saying, "People in China are going

to get richer in the future,

and they're going to want to identify their status

as a wealthy person with an automobile.

Why shouldn't that be a Cadillac?"

So they're just thinking, "Well,

why don't we put Cadillac in there?"

Well, they put Cadillac in there 10 years ago,

and it's been extremely impressive.

Kim: Between 2016 and 2017, Cadillac sales in China

exploded by over 50%, leading Cadillac to record

its second-highest global sales mark

in the company's 115-year history.

The company already has plans to expand

its network of dealers to 500 in China by 2025.

DeBord: We look at a rise in Cadillac,

we look at a fall in Cadillac,

and the fall may be something that can't be

arrested in the market where the brand was created.

I mean, it's one of the original General Motors brands.

But they could create a brand

that means something in another part of the world.