Whether you love it or hate it, electric vehicles appear to have picked up quite a bit of speed in 2020. With governments across the world (and in California) setting bans on the sale of new ICE-powered vehicles before the end of next decade, automakers are pushing to make sweeping changes. General Motors has not been quiet about their efforts, announcing that some 30 new EVs are on track to arrive by 2025. Cadillac is reportedly slated to spearhead this charge to battery power, potentially emerging as a fully-electric brand by that same deadline. It doesn’t appear that all Cadillac dealers are on board however, as nearly 17 percent of U.S. dealerships have opted to close rather than make the move to selling electric vehicles.
It is important to note that this move wasn’t made out of spite for the electric vehicle, at least not entirely. General Motors gave Cadillac dealers the ultimatum to either tool up for the coming EVs, or stop selling their products. According to the report from The Wall Street Journal, around 150 of the 880 Cadillac dealerships in the U.S. agreed to accept a buyout offer from GM, ranging from $300,000 to $1,000,000. The remaining dealerships agreed to pay the $200,000 for the necessary charging infrastructure and other upgrades needed to sell an all-electric lineup.
This means that one in six Cadillac dealers here in the U.S. are choosing to stop operations. And while that is a huge amount of dealerships to simply close, Cadillac massively outnumbers its European rivals in this department. According to The Drive, BMW had 341 dealerships in the U.S. in 2018, while Mercedes-Benz operated some 363 dealerships as of 2019. While it’s clear that GM might have had too many dealers to begin with, it has to be asked how many simply didn’t have the large-chunk of money to invest during a global pandemic.
Those who have followed GM and Cadillac through the years can recall several times where the mothership became at odds with its dealer network. Normally involving things like overall brand direction and the investments required from franchisees to keep their showrooms up to par. Most recently, and perhaps most famously, was former Cadillac CEO president Johan de Nysschen and his Project Pinnacle initiatives. Despite the aggressive push to elevate the Cadillac brand in various (often unsuccessful) ways, word on the street was that dealers both disliked the plan, and JDN himself. This may or may not have led to his ousting in 2018.
Regardless of whatever sort of infighting that may or may not have taken place, General Motors is making big swings when it comes to electric vehicles. One look at their GMC Hummer EV is enough to solidify that. It will be interesting to see how this change plays out for Cadillac, especially as so many U.S. customers aren’t ready to commit to an EV. That said, Cadillac may just be the “Legacy” brand best poised to utilize the more refined power delivery of an EV powertrain.
On the horizon, GM plans to make Cadillac a purely electric brand as soon as 2025. Along with the upcoming Lyriq EV, an electric Escalade is on the way, as is a highly-exclusive, hand-built American electric luxury vehicle expected to be called the Celestiq. What this means for high-octane performance cars like the incoming V-Series Blackwing models remains to be seen, but the writing could be very much on the wall.