Cadillac And GMC Dealers Have A Problem With New EV Plans

Industry News / 9 Comments

It's all about the money, of course.

Like all mainstream automakers these days, General Motors is proceeding at full-speed with its electric vehicle plans. Last spring, it revealed its new proprietary battery pack technology, called "Ultium," that will underpin a new generation of EVs. A new third-generation global electric vehicle architecture that's highly flexible and scalable is also on the horizon. And, of course, there's the upcoming Cadillac Lyriq and GMC Hummer. GM's electrified future certainly sounds exciting but it appears not all of its dealerships are thrilled, at least when it comes to the investments involved.

Automotive News reports that some dealers are having second thoughts about a new agreement that requires them to make expensive investments in preparation for future EVs, including the Lyriq and Hummer. The current agreement stipulates dealers spending between $120,000 to $200,000 in sales and service preparations.

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However, more rural GM dealers are finding it hard to see a return on their investments for one key reason: their customers have little to no interest in EVs compared to their big city and more suburban counterparts. For example, just one-third of GM dealerships in the state of Virginia signed a contract agreeing to invest in these upgrades. Dealers in parts of North Carolina are also giving some pushback.

"They do not believe that all of a sudden when the factory comes out with a new car or a new line of cars that they should have to sign a separate agreement," North Carolina Automotive Dealer Association President, Bob Glaser, explained. "If I'm a Buick dealer, I should be able to sell all Buicks."

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GM, however, sees things differently. GM North America President and former Cadillac boss Steve Carlisle believes these dealer investments are "a necessary step that we need to take to achieve our vision of an electrified future." That's all fine and good, but how can GM persuade dealers who still have doubts.

"As we roll out products and that adoption curve kicks in, the volume will grow," Carlisle added. "We certainly expect that there will be a return on that. That's our mutual future."

Source Credits: Automotive News

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