About 150 Cadillac dealerships are doing GM buyouts as a substitute of investing in electrical autos
General Motors posted this teaser image of an illuminated Cadillac badge on the front of the Lyriq ahead of the crossover’s debut.
DETROIT – Approximately 150 General Motors dealerships have accepted acquisitions and will cease sales of Cadillacs as the Detroit automaker leads the luxury brand to direct its all-electric vehicle efforts.
GM recently announced to its 880 U.S. Cadillac dealers that it would cost at least $ 200,000 to sell its upcoming electric vehicles to improve dealerships. The cost includes EV chargers, tools, and training. Such investments are typically seen as part of the larger dealership’s business, but can be challenging for smaller dealers, of which Cadillac has more of which compared to other luxury brands across the country.
The acquisitions are the latest sign that GM is accelerating its EV efforts, including investing $ 27 billion in fully electric and autonomous vehicles by 2025. That investment, an increase of $ 20 billion announced earlier this year is expected to produce 30 new EVs worldwide by 2025, including more than 20 for North America only.
“This forward-looking product offering needs to be combined with an exceptional customer experience,” GM said in a statement sent via email. “Future dealer requirements are a logical and necessary next step on our journey to electrification to ensure that our dealers are ready to deliver an exceptional customer experience.”
GM expects a majority, if not all, of its Cadillac cars and SUVs sold worldwide to be all-electric vehicles by 2030.
David Butler, chairman of the Cadillac National Dealers Council, said the board had suggested the acquisitions as a way for dealers who may not want to participate in the EV investment to get out of their agreements with GM.
“We suggested the deal would be worth it for the dealers,” he told CNBC, citing an earlier buyout from 2016 that did not attract many Cadillac dealers.
The Wall Street Journal, which first reported the number of dealers making the acquisitions on Friday, said GM’s takeover bids ranged from $ 300,000 to more than $ 1 million. Buyouts were largely based on sales and varied based on the size of the retailer by company.
The 150 or so dealers who accept the acquisitions represent approximately 17% of Cadillac’s US dealers. According to Automotive News, which first reported on the offers last week, dealers had until November 30th to decide on a buyout.