Cadillac offering $500G to buy out dealers not willing to invest in EV future
There is a $200,000 investment required to sell the upcoming electric vehicles
General Motors unveiled the Cadillac Lyriq. FOX Business’ Grady Trimble with more.
You’re either in our you’re out.
Cadillac is offering dealers up to $500,000 to relinquish their franchises if they’re not willing to update their stores to sell the brand’s upcoming electric cars.
Dealerships will require approximately $200,000 worth of investments in charging and service upgrades to accommodate the new models, which kick off with the Lyriq SUV scheduled to arrive in early 2022, Automotive News reported.
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Cadillac North America V.P. Mahmoud Samara confirmed the buyout offer, but not the amount being offered, which dealers' sources told the outlet range from $300,000 to $500,000.
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Cadillac has 880 dealers nationwide, but about half of them sell fewer than 50 vehicles annually. The brand delivered 156,246 cars and SUVs in the U.S. last year. Dealers who take the buyout offer, which is good until Nov. 30, will be allowed to acquire new Cadillacs through the end of 2021. Many of them also have franchises with other GM brands.
“We had discussions with all the dealers around what is our EV journey, how are we going to get there? It was a very open, transparent discussion – allowing all dealers to understand and buy in,” Samara said.
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General Motors last week announced an accelerated schedule for its electric car rollout that includes the introduction of 30 models globally by the end of 2025. Over a dozen are planned for the U.S. across all four of its brands, but the buyout offer is currently focused on the Cadillac dealer network.