Cadillac To Convert 700 Dealers To Boutique Stores With High Levels Of Service And Technology

Cadillac plans to ask about 700 of its dealerships to invest in small "boutique" stores that would offer "high technology showrooms" and a higher level of service than they offer today.

Cadillac President Johan de Nysschen outlined the plan in an appearance at the Washington, D.C., auto show today and will discuss it further at the National Automobile Dealers Association convention in San Francisco this weekend.

Cadillac's network of slightly more than 900 dealerships includes about 200 "flagship" standalone stores. Another 700, many of which are paired with Chevrolet or other brands, will be asked to convert to "smaller, boutique locations," the brand said in a statement.

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TheSteve - 1/22/2015 12:26:30 PM

+2 Boost

I think that idea works only if you already have the public perception that you're stocking the store with a premium product. Rightly or wrongly, The Apple Store(s) hold the distinction of generating the highest profit per square foot of any retail space. That's because a substantial segment of the public views iPads, iPhones, and Macs as premium products. Meanwhile, The Microsoft Store, which tried to copy Apple's success, looks like a ghost-town if you visit it. The public, by and large, does not perceive Microsoft products as premium products.

Until mass public perception changes to perceive Cadillac as a highly desirable, premium vehicle on par with BMW, Mercedes, Porsche, and arguably Audi, I believe putting Detroit Iron in "boutique" stores will do little, if anything, to increase Cadillac's profitability.

mre30 - 1/22/2015 1:23:45 PM

+2 Boost

Cadillac will have to go thru a painful period of adjustment while they make this switch. The level of service at stand-alone Cadillac dealers is much higher than combined (i.e. GMC:Cadillac; Chevy:Cadillac; etc).

In my area, NY/NJ, there is an excellent stand-alone Cadillac dealer, Brogan Cadillac of Totowa (where I bought an SRX for my dad) that was a much better experience than the Chevy:Cadillac dealer in my town in Long Island where I first went to check out an SRX for him (its what my dad wanted - don't get me started).

Cadillac's sales will likely go down while they jettison dealers - or perhaps they will devise creative ways for their existing standalone dealers to "buy-out" the territory of the others and the process will be orderly.

It has to happen - but it will be painful.

ricks0me - 1/22/2015 5:28:54 PM

+1 Boost

The Steve: Right on with your comments

runninglogan1 - 1/22/2015 5:29:58 PM

+3 Boost

One of the main reasons Lexus was such an outstanding success right out of the gate was the unparalleled service at their dealerships. The competition has more or less caught up but a little bit of that magic certainly won't hurt Cadillac. I think most of their product is already top notch.