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GM offers $500,000 to Cadillac dealers who want to opt out of the EV revolution

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#1 ·
GM offers $500,000 to Cadillac dealers who want to opt out of the EV revolution
Yahoo Finance
By Greg Rasa
November 23, 2020

GM is offering $300,000-$500,000 to any Cadillac dealer who is not down with GM's ambitious plans to make Cadillac an all-electric brand. CEO Mary Barra last week outlined to investors GM's plan to accelerate the transition to EVs, increasing spending on electric and self-driving cars by 35 percent to $27 billion in the next couple of years. The Cadillac Lyriq EV's launch has been accelerated to 2022, and by 2030, Cadillac could be out of the internal-combustion engine business altogether as GM's electric standard-bearer.

That might not appeal to a dealer who doubts the business case, or who doesn't want to gear up with the infrastructure to charge or service electric cars. Meanwhile, GM has been trying to thin its pool of Cadillac dealers for years, having last tried to muster out hundreds of its lower-volume dealers in 2016 with a much smaller lure of $100,000-$180,000, but it got few bites. This time, the buyout's being offered to all 880 Cadillac dealers and might prove to be a win-win.
*Full Article at Link
 
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#13 ·
....EV charging stations should be at all dealers for consumers to recharge for free or a fee ..limited up to 80 % which should be around 20 minutes per customer.
I don't see that working. The dealer won't want to waste the space (or the money) for drivers who aren't shopping. And the drivers won't want to waste their time hanging around a dealership when they aren't shopping.

It makes much more sense for chargers to be at locations that a driver will already NEED to be at (restaurants, shopping, etc).
 
#5 ·
The most crucial utility an EV can’t provide is towing distances. I take it that the vast majority of Escalade owners don’t load up a travel trailer and haul long distances so utility-wise, going all electric won’t risk sales in that early phase of 100% EV. They could always cross shop a GMC Yukon Denali as well. Wonder what percent of Escalade owners load up the family and gear and drive 600-800 miles a day to their destination on family vacations? Even without a trailer that could be a challenge in an EV.
 
#6 ·
True. This all electric gig is being pursued without much regard to reality in various consumer needs. I'm sure this latest offer will help weed out some more lower volume dealers, but my issue is with moderately sized communities in more rural areas of the country that may disappear leaving owners and buyers having to travel 50+ miles or so just to have things taken care of at a dealership. I use this point in reference to the area around here, my community has a well establish decent volume dealership and 50 miles to the north another dealer in a moderately sized community that doesn't do near the volume. If it goes away, all those owners and buyers in the multi county area up there will have to come down here for everything :(.
 
#9 ·
On detail of the article: "...by 2030, Cadillac could be out of the internal-combustion engine business altogether as GM's electric standard-bearer."

In other words, if this article is right Caddy will be offering ICE for at least 10 more years...way past the 2025 "deadline" for EVs. Caddy will regulate ICE/EV according to demand.
 
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#10 ·
Seems fairly reasonable. GM is giving dealers the 10 year plan. And if they don't like it, they can terminate with 1/2M. If you follow the link's link, the details are clearer. Accepting the deal allows you to sell thru 2021. I'd think GM might sweeten that to 2023, with the stipulation you can't sell EV's if you take it. But what they are really trying to do is cull the dealer count.
<br><br>I've never quite understood why they want to cull as it is a balance of specialness of the brand vs getting your car serviced anywhere. I tend towards the getting it serviced anywhere is the more valuable side of the equation. But I get how specialness may generate more sales than service availability.<br><br>
the big surprise to me was how little some dealers make on their caddy franchise. I imagine those dealers have to be selling other GM brands to make it a biz. Otherwise selling cars would be a hobby for them.
 
#51 ·
the big surprise to me was how little some dealers make on their caddy franchise. I imagine those dealers have to be selling other GM brands to make it a biz. Otherwise selling cars would be a hobby for them.
I always thought that the owner of the Steve Foley Cadillac-Bentley-Rolls Royce dealer here in the Chicago area must have a true love for Cadillac and that’s it. I’m sure, other than the Escalade, it doesn’t bring him that much money in to have Cadillac in the same lot as those other two brands. As a Cadillac fan though I love the thought of people shopping for a Bentley or a Rolls probably glancing over at the Cadillacs when they otherwise would not. Especially as Cadillacs get better. The Celestiq in this scenario wouldn’t look out of place when it finally arrives.
 
#11 ·
For the most part we are talking very low volume, small market dealers who struggle (or simply decline) to meet minimum Cadillac standards of sales and service. To expect them to meet the new tech requirements of an EV world, GM would have to heavily subsidize with virtually no payback. Many such shops further devalue an already struggling luxury brand. See ya. Wouldn't wanna be ya.
 
#14 ·
To make BEV's work, you (that is GM) needs at least one of the following:

1. charging network: really this should be a charging network, service station, convenience store, and GM accessory store. Spending money to get rid of franchises that may enable that required component of BEV success is ridiculous.
2. home-based charging capability: Either via your local electric company or via solar panels and where available wind generation. BEVs major plus (in my opinion) is removing the requirement in most cases of "filling up" at a gas station, spending money on a cup of coffee ('cause why not), and then buying that sandwich that always fights back two hours later.

GM is doing none of this today (maybe it will later) and banking its whole success on factors that are dependent on so many other things currently out of their control.
 
#15 ·
Sorry do not agree. If every manufacturer has their own proprietary network of charges, well, just will not work. There are several companies that are tackling charging, and it will not matter if you have a bmw, benz, gm, ford, ... bev. You will plug it in just like I go to shell, chevron, mobil ... gas stations. As to home charging, there already are plenty of choices in the market. Heck, my utility will help pay for it.
 
#19 ·
One of the reasons i leased or bought 5 Cadillacs between 2004 and 2014 was that i could get them service or repaired even in mid size town. Our vacation home is in hendersonville NC and while there is one in Asheville 30 minutes away i still didnt need to get on i26 and deal with that unpredictable traffic. I sold the '14 SRX in '19 and bought a F150 Supercrew.
 
#21 · (Edited)
How frequently to people visit dealerships anymore anyway? Cars are nearly flawless now, their service intervals are up-to 1 Year/10,000 Miles, and they come and get the car if they need any service. I haven't been to my Lincoln dealership in about 18 months. That should go down further with EVs, not to mention COVID has further expanded contactless expectations. I bet some dealerships simply don't see the benefit in a customer they will never see after they sell the car.
 
#37 ·
How frequently to people visit dealerships anymore anyway? Cars are nearly flawless now, their service intervals are up-to 1 Year/10,000 Miles, and they come and get the car if they need any service. I haven't been to my Lincoln dealership in about 18 months. That should go down further with EVs...................
How much lower than ZERO should owners expect with an EV?

I've been to the GMC Dealer twice in 26 months, both for my free oil-change, morons forgot to do the recall, don't expect to be back unless I have some warranty issues before it terms out.


I bought my prior Soul at a KIA-Caddy dealer, George Gee. Talk about hedging your bets.
Fast-forward 5 years, and let's see what those Cadillac Dealers are selling?...... Hyundai, Kia, Mazda, Subaru?


Car makers weren't involved in the expansion of refineries or service stations - so why do they need to be involved with electricity supply?
Because the business model "doesn't work" if there is a need and an opportunity for profit, free-market capitalism will fill the void.

Think about it, Drug Store, Sub Shops or Auto Parts Stores, popped-up around me like mushrooms in a damp spring day.


But if dealerships aren't around...where am I going to get my $500 pinstriping, and $1000 underbody treatment done?
Those workers will be displaced, bagging cannabis at the local "Green House".

(You won't miss either one of those dealer add-ons..............)
 
#28 ·
I think the whole concept of dealers as they exist today is archaic. Might've made sense 100 years ago, or even 25 years ago. But to it makes more sense that the manufacturers control/own the sales processes, dealers just add costs to the purchase price which are of course passed onto the consumer. I think it makes more sense for the franchise owners to now be only repairs/service. And, as the sales/service are separated, we'd have GM repair centers, not brand specific. That will ensure service coverage nationwide, even for brands like Cadillac where there are significant areas that can't support a Cadillac dealership.
 
#43 ·
That in it's self is an interesting thought. Escalade is by far the Most Profitable vehicle in Cadillac's stable.

Escalade isn't focused on beating Mercedes, BMW, Audi. It is "Just a Cadillac, on a GM Platform, with more luxury than any other GM on that Platform.

Now, it is "Hey Look Tesla" (squirrel) approach, but GM is looking at throwing everything at this venture. And it is still not a Proven, Steady, Long Term, Consumer Friendly, market.
 
#46 ·
Because our Great Leaders, the Chinese and the Europeans, know best. If you doubt that, just look at the past 100 years of their respective histories. :rolleyes:
 
#48 ·
Rich people don’t care about saving the planet (not that electric vehicles will because they won’t) and they care even less about the price of gas. Hell I’m merely middle class-upper middle class and I don’t care about the price of gas. I own a Camaro SS and a Silverado 2500 7.4L. And I ain’t giving up either.

So people in the market for a $50k-plus car want ease of use. Charging a car is not easy. Filling the tank with gas is easy.

Cadillac might not have much to to with Mercedes customers now, but whatever’s left will buy a big honkin Mercedes with a gas engine.
 
#49 ·
Hell I’m merely middle class-upper middle class and I don’t care about the price of gas. I own a Camaro SS and a Silverado 2500 7.4L
Haha, this is the main reason Europeans, especially in poorer parts of the continent hate America. Every discussion about cars starts here with the car's fuel efficiency. What's worse people are hypocrites, many of them buy much more thirsty (and more expensive to maintain) used BMWs than cheaper and younger Skodas/Opels etc. Also if a European car is thirsty - it's ok. I never hear comments about fuel efficiency of my CLS which gives the same MPG numbers as STS I used to own. But the STS was a 'gas-hog only fat Americans buy'. :D Yup, this kind of comments come from grown men. :(
 
#75 ·
Its crazy...for some people who claim to work in tech to act as if battery recharging tech isn't going to evolve at all in 15 years is ridiculous. Then on top of that, this phobia of laws banning the sale of new ICE cars after 2035 as if everyone is going to wake up on January 1, 2035 with EVs in their driveway all of a sudden.

Banning new ICE sales just simply means that in the 10-15 years following 2035 most of the ICE cars on the road will be phased out. Kinda like how you don't see any Oldsmobile Aleros on the road in 2020...they were rightfully phased out and banished to the junkyards where they belonged in the first place.
 
#82 ·
Yet the car battery in our cars has been the same for how many years? Are they getting cheaper, why no technology advancements, its crazy!?

Alero's were a decent car for the time (not great) but they are now ~20 years old, most have been used-up if they didn't rot out by now.

FWIW: There are STILL over 700,000 GM 1997-2005 N-Bodies on the road today.


All the ones that didn't take Caddy's last (much lower) offer, this give them a check for more than they'd make selling Cadillac's for the next 15 years, plus it'll be a good down-payment for their Hyundai Francise!


Interesting. That's more than I expected.

Makes one wonder: How many ELR's did those 150 Caddy dealers collectively sell?
GM has had a lot of small-town Caddy Dealers that didn't sell much product, Ford/Lincoln did their purge when they killed Mercury, this will negatively impact Caddy's sales, but not much.

~150 x ~50 = ~7,500
 
#96 ·
For all the high density housing EV drivers they will have to make extension cords out of conductive carbon fiber or something. Cooper or aluminum heavy gauge extension cords will be easy pickings for scrap thieves. If the cords cost less than $950 in CA they won't even try to stop them.
 
#97 ·
Why not OTA charging from windmills and solar? Oh yeah, green green green. Mister Green Jeans, Jolly Green Giant, certain female congresshomie, they can all start running those networks! Yes we can! Charge, charge we can believe in!
 
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#100 ·
If I were a small-town Cadillac dealer, I'd take the walking money easy. I don't know if its too late but GM needs to figure out how to rollout multiple EVs while also keeping its ICE line fresh. What CEO Jeezy would've done was while I made Cadillac an EV only division would be to roll up Hummer to the Cadillac network and not GMC. I'd then single out Buick and GMC as my 100% ICE brands and half-ed Chevrolet...into a 50% ICE/EV mix. Keeping ICE cars like the Camaro/Corvette and adding cars like the Avista/Avenir and selling Bolts/Bolt EVs and "E"mpalas (tm) and "E"quinoxes to ensure that I'm still generating buzz w/ my ICE lineup while I'm transitioning over EVs.

My beef is that GM went whole EV hog at the expense of everything that isn't a fullsize SUV or Corvette. It's going to turn a lot of people off to GM that might not come back.
 
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