Photo: Cadillac/General Motors
In late 2020, General Motors reportedly decided to give its dealers a choice between committing to future investments in their showrooms or receiving the money to cancel the franchise agreement. It appears that almost one in five dealers has chosen the latter, which will lead to a smaller network of Cadillac dealers in the U.S.
The first EV from Cadillac will arrive in early 2022, in the form of the Lyriq crossover, and four other models are expected to be launched in years to come. With an electric offensive planned, the American brand needs interested dealers to invest a reported $200,000 in their showrooms to be ready to sell and service electric vehicles.
Cadillac had 880 dealerships in the U.S. at the end of 2020, but the brand is outsold by its German competitors for years. Rivals from BMW, Audi, and Mercedes-Benz have a smaller network in the U.S. when compared to Cadillac. At the same time, the marque's sales are lower than those of any other brand in the GM portfolio, which means that Cadillac has seen better days.
General Motors did not confirm that $200,000 is the value of the investment, but the sum may be a bit too much for some dealers. Happily for them though, GM thought out a plan that offers lump sums between $300,000 and $500,000 for those willing to terminate their license agreements. We should point out that the numbers presented above have not been commented on by the GM representatives.
Approximately 150 of the 880 Cadillac dealers in the U.S. have already taken GM's offer on closing their franchises and getting paid to do so, Automotive News (subscription req.) reports. If the numbers are correct, that means that almost one in five Cadillac dealers have decided to end their contracts with GM instead of committing to investing a reported $200,000 in upgrades to accommodate electric vehicles.
It is worth noting that dealers who take up GM's offer of ditching Cadillac in favor of a severance payment can still sell General Motors products. Therefore, those multi-brand dealers will not have to close their doors completely, but they will not be able to sell Cadillacs anymore.
Cadillac had 880 dealerships in the U.S. at the end of 2020, but the brand is outsold by its German competitors for years. Rivals from BMW, Audi, and Mercedes-Benz have a smaller network in the U.S. when compared to Cadillac. At the same time, the marque's sales are lower than those of any other brand in the GM portfolio, which means that Cadillac has seen better days.
General Motors did not confirm that $200,000 is the value of the investment, but the sum may be a bit too much for some dealers. Happily for them though, GM thought out a plan that offers lump sums between $300,000 and $500,000 for those willing to terminate their license agreements. We should point out that the numbers presented above have not been commented on by the GM representatives.
Approximately 150 of the 880 Cadillac dealers in the U.S. have already taken GM's offer on closing their franchises and getting paid to do so, Automotive News (subscription req.) reports. If the numbers are correct, that means that almost one in five Cadillac dealers have decided to end their contracts with GM instead of committing to investing a reported $200,000 in upgrades to accommodate electric vehicles.
It is worth noting that dealers who take up GM's offer of ditching Cadillac in favor of a severance payment can still sell General Motors products. Therefore, those multi-brand dealers will not have to close their doors completely, but they will not be able to sell Cadillacs anymore.
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