GM to Split Off Cadillac and Move Brand's Home to New York

Trying to forge a fresh approach for a luxury car maker that is struggling to keep up, General Motors is moving the Cadillac brand's headquarters to New York and will break it off into a separate business unit.

The shift is the biggest shake-up yet by Cadillac's new president, Johan de Nysschen, who joined the company last month from the Infiniti division of Nissan. He was previously at Volkswagen, where he led the remaking of Audi into a top competitor against BMW and Mercedes-Benz in the luxury car market.

Cadillac wants acceptance into that elite group, but for years it has struggled to find its footing. Through August, the overall luxury auto market has surged 14 percent over the same period a year earlier - but Cadillac's sales are down 5 percent, with its sedans falling by 15 percent.

Mr. de Nysschen was brought in to change that trajectory, and he has promised bold moves to restore Cadillac's once-renowned luxury image. Moving his team to New York, he said, would help it break with the past and connect with another lifestyle.

'It allows our team to share experiences with premium-brand consumers and develop attitudes in common with our audience,' he said in a statement.

The new Manhattan headquarters, set to open next year in SoHo, will house the 'majority of functions with oversight and responsibility for both global and U.S.' Cadillac operations, G.M. said in a statement. But the product development teams and manufacturing facilities will remain in Michigan.

The move also underscores the challenges Cadillac has had in finding its voice within the larger G.M. organization, whose gleaming Renaissance Center towers over downtown Detroit.

'Cadillac has been through a tough year of lower sales, including decreased sales of some of its newest cars, in a luxury car market that is booming,' said Michelle Krebs, senior analyst at 'It'll take more than moving the headquarters to New York to fix that.'

By moving top Cadillac officials across the country, the company hopes to give its luxury brand more autonomy - which Mr. de Nysschen himself is known to value.

Ms. Krebs said that New York is also where many deals are made on cooperative ventures that Cadillac wants a piece of - so the move could help it compete with BMW and Mercedes-Benz, which also have their offices outside New York.


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