A niche vehicle is one that serves a very specific set of buyers with a vehicle that’s defined by a specialized and uncommon or unique role; and is often knowingly sold in low numbers to satisfy that dedicated group. Sometimes it’s to test a market: The Miata created its own niche in the 1990′s, and became a role model for modern product, like the S2000 and BRZ/FRS. Other are more esoteric niches, like the Nissan Murano CrossCabriolet. Sometimes, niche cars bring buyers to a brand that they would not have thought about before.
Currently, one of our most popular niches is the hybrid segment, dominated by the Toyota Prius. Chevrolet threw their hat into the ring, inadvertently, with the Volt. Though primarily an electric car, it does run the gas engine as a series hybrid with engine lockup if needed for maximum efficiency. The sales have been mediocre, pushing just over 23,000 units in 2013. The Prius? It sold over 145,000 units in the same time period..
Is it any wonder, then, why 43% of Cadillac’s dealers aren’t willing to take the up-market, $75,000 (before $7,500 Federal tax credit) Cadillac ELR? It’s a niche of a niche. And it’s an expensive one for dealers to take a risk on.
Edmunds reports that 410 out of Calliac’s 940 dealers will not take delivery of the new ELR, an fairly astonishing 43%. With fuel prices relatively low and a high sticker price, there appears to be little demand for the ELR, and dealers are keen on it. Jim Vurpillat, Cadillac’s global marketing director, told Edmunds in an interview that dealers “might look at (ELR) and say, ‘Ok, if I sell one of these, I got to have service charging stations, special training, a sales area. I have to buy special tools… If they don’t think they will sell more than one or two units a year, they would do the numbers, and it is probably not worth it.”
The cost for the training, additional tools, and other EV equipment can total $15,000 according to Edmunds. It’s just too costly of a chance for many Cadillac dealers to take. Most sales are expected to be in California, Dallas, Miami, and New York City, says Vurpillat. In Austin, Texas, our single Cadillac dealership has had one in stock.
But, at which point do we look at this as no longer chasing a niche, but falling into failure? Is it nearly half of your dealer network saying “no, thank you”?