Photo: Cadillac
General Motors is walking on a tightrope as far as the luxury segment is concerned. Not only did it fail to re-establish Cadillac as a genuine alternative to German imports in the past decade, but higher-ups have also given Cadillac dealerships an ultimatum.
According to Automotive News, every dealer in the U.S. selling and servicing this brand has to make a choice. More to the point, a choice between committing $200,000 in upgrades or receiving $300,000 to $500,000 to cancel the franchise agreement. As the headline implies, the first option is necessary in preparation for Cadillac’s electric future. Industry sources are suggesting the switch to an EV-only lineup may happen as early as 2025.
The problem is, $200,000 in mandated upgrades is a huge amount of greenback for a dealership that sells a low volume of vehicles. Adding insult to injury, 400 of the smallest dealers faced a similar situation in 2016 when Johan de Nysschen was the head honcho of Cadillac. Those who didn’t want to spend the money necessary to upgrade their showrooms were offered buyouts ranging from $100,000 and $180,000.
This time around, all 880 dealerships with Cadillac franchise agreements in the United States are required to adapt or drop the brand for good. That’s $176 million in upgrades in total, and worse still, Cadillac sells fewer vehicles than other GM brands in this part of the world. Whichever way you look at it, this is a very tough decision for the middleman.
You also have to understand the hidden meaning of General Motors putting Cadillac on an all-electric trajectory. More specifically, people past their prime like your dad and auntie are no longer in the target market. This is especially curious given the price tag of a well-equipped XT5 SUV, but then again, this isn’t the first time GM has shot itself in the foot.
One textbook mistake is the revival of the Blazer as a crossover while Ford is riding on a wave of hype thanks to the all-new Bronco with body-on-frame underpinnings and off-road capability. As far as Cadillac is concerned, the ELR is probably the lowest point of the brand in the past decade.
Essentially a re-badged Chevrolet Volt, the electric coupe retailed at $75,000 or $35,000 more than the golden bowtie’s model. Less than 3,000 units later, General Motors pulled the plug on this shameful piece of Cadillac history.
The problem is, $200,000 in mandated upgrades is a huge amount of greenback for a dealership that sells a low volume of vehicles. Adding insult to injury, 400 of the smallest dealers faced a similar situation in 2016 when Johan de Nysschen was the head honcho of Cadillac. Those who didn’t want to spend the money necessary to upgrade their showrooms were offered buyouts ranging from $100,000 and $180,000.
This time around, all 880 dealerships with Cadillac franchise agreements in the United States are required to adapt or drop the brand for good. That’s $176 million in upgrades in total, and worse still, Cadillac sells fewer vehicles than other GM brands in this part of the world. Whichever way you look at it, this is a very tough decision for the middleman.
You also have to understand the hidden meaning of General Motors putting Cadillac on an all-electric trajectory. More specifically, people past their prime like your dad and auntie are no longer in the target market. This is especially curious given the price tag of a well-equipped XT5 SUV, but then again, this isn’t the first time GM has shot itself in the foot.
One textbook mistake is the revival of the Blazer as a crossover while Ford is riding on a wave of hype thanks to the all-new Bronco with body-on-frame underpinnings and off-road capability. As far as Cadillac is concerned, the ELR is probably the lowest point of the brand in the past decade.
Essentially a re-badged Chevrolet Volt, the electric coupe retailed at $75,000 or $35,000 more than the golden bowtie’s model. Less than 3,000 units later, General Motors pulled the plug on this shameful piece of Cadillac history.
Google News