GM Begins Cadillac Dealerships Hunt

The painful restructuring process GM has to go through during bankruptcy protection may prove to be even more destructive to its dealers, and that's no longer a secret. But the bulk of that pain will be supported, apparently, by the company's dealerships located in metropolitan areas, as GM plans to kill hundreds to get per store sales comparable with those of foreign brands, Autonews reported.

GM admits that some of those dealers will find out, with surprise, they will be terminated by October 31, 2010, according to GM spokesman Pete Ternes. The goal is to align the number of Cadillac dealerships with those of its competitors.

"Our current footprint of 1,400 Cadillac dealers, most of which are dualed, is out of sync with modern luxury automotive retail," Matk LaNeve, GM sales chief was quoted as saying by the aforementioned source.

To put it in plain terms, the 1,400 Cadillac dealerships are being severely outclassed by less than half that number BMW and Lexus stores. Just to give you an idea of how many Cadillac stores will have to go, LaNeve said the aforementioned competitors do very well with only 250 to 450 units.

"Mercedes-Benz, BMW and Lexus outsell us with 250 and 450 dealers. We have to address this and enable our large Cadillac dealers to do
more volume," the official said.

According to data provided by Autonews, Cadillac average sales per store in 2008 stood at 112 units. By comparison, Mercedes sold 651 units, BMW 737 units while Lexus sold no less than 1158 vehicles. GM has 1,422 Cadillac dealerships, while the Japanese manufacturer only 226.