GM Seeks New Ad Agency for Cadillac

General Motors Co. said it is seeking a new advertising agency to handle its Cadillac business, its latest effort to jump-start the ailing luxury brand.

GM is the latest auto maker to overhaul its advertising amid the ongoing turmoil in the automotive sector.

Modernista, a small, independent ad firm in Boston that has handled the coveted account since 2006, has decided not to compete for the business.

Modernista's award-winning work for the Hummer brand eventually prompted GM to give the agency the Cadillac business after it had been handled by Publicis Groupe's Leo Burnett for some 70 years.

Modernista's future with GM has been the subject of speculation since GM shook up its marketing and sales operations this summer. After the company exited bankruptcy reorganization, North American marketing was taken over by Robert Lutz, who had been heading new-car development. Mark LaNeve, who had been in charge of marketing and sales, was left with only sales responsibilities. Mr. LaNeve, who is departing the auto maker, was seen as an ally of Modernista.

The Cadillac business was then given to Bryan Nesbitt, a car designer who was a favorite of Mr. Lutz's. The decision to seek a new agency for Cadillac is the most visible marketing initiative by Mr. Nesbitt so far.

In a recent interview, Mr Nesbitt said advertising needs to emphasize Cadillac's sophisticated engineering and edgy designs, seen most prominently on the Cadillac's flagship, the CTS sedan.

Cadillac sales are slumping. So far this year, they have fallen 46%, while competitors like BMW AG, Daimler AG's Mercedes division and Toyota Motor Corp.'s Lexus have seen declines of roughly 25%.