Cadillac President Will Pay Dealers to Disappear

Steph Willems
by Steph Willems
cadillac president will pay dealers to disappear

If dealership owners spring for a recent offer by the president of Cadillac, expect to see a vastly reduced brand presence in towns and cities across the U.S.

Johan de Nysschen is offering 400 low-volume Cadillac dealers cash to close up shop and walk away, Automotive News reports.

It’s nothing personal, the brand’s performance-focused leader claims — just business.

In an interview with AN, de Nysschen claims the brand has too many dealerships as it is, at least when compared to its luxury rivals. Paring down the herd, even significantly (the 400 dealers are 43 percent of the brand’s U.S. dealer presence), would make it easier for the brand’s dealers to fold into the executive’s controversial “ Project Pinnacle.”

That program, due to kick off on January 1, would see dealers slotted into five tiers based on sales volume, each offering a certain level of customer perks. Compensation from the automaker would be tied to sales performance.

Because dealers would need to invest in their facilities to upgrade their services, the buyout offer gives smaller dealers a chance to avoid the hassle, de Nysschen says. The offers starts at $100,000 and rises to $180,000, depending on the operation. The 400 targeted dealers each sold less than 50 Cadillacs last year.

Ideally, de Nysschen would like every Cadillac dealer in the country to be on board with Project Pinnacle. “Our target is zero,” de Nysschen said. “Our target is to have 100 percent of the Cadillac dealers engaged with the Cadillac business.”

Backlash against the program has grown since de Nysschen introduced it. A California dealer group recently wrote to General Motors CEO Mary Barra in a bid to delay the rollout. The group claimed Project Pinnacle violated state franchise laws, heaped unfair costs onto dealerships, and discriminated against smaller dealers.

It’s hard to see this buyout offer as anything other than a make-the-problem-go-away effort.

[Image: © 2016 Matthew Guy/The Truth About Cars]

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  • Jeff S Jeff S on Sep 26, 2016

    In many smaller communities the dealers disappeared because they were forced to take a specific number of vehicles and an allocation of types of vehicles that they could not sell in their communities. Many smaller dealerships have for the most part disappeared. At one time the small town near where my grandparents farm was had a Dodge, Ford, Oldsmobile-International dealerships in a county of about 2,000 population. Profitability of a small GM dealership is not that much in today's world of mega dealerships and the internet. Most buyers are looking for the best price.

  • Boomstick0 Boomstick0 on Oct 19, 2016

    I have to drive 50 miles to the nearest Cadillac dealer, and because they didn't particularly do a very good job, I have to drive 90 miles to the next nearest alternative. Too many dealers? Give me a break. Are they trying to kill the brand?

  • Schurkey Decades later, I'm still peeved that Honda failed to recall and repair the seat belts in my '80 Civic. Well-known issue with the retractors failing to retract.Honda cut a deal with the NHTSA at that time, to put a "lifetime warranty" on FUTURE seat belts, in return for not having to deal with the existing problems.Dirtbags all around. Customers screwed, corporation and Government moves on.
  • Bullnuke An acquaintance of mine 50+ years ago who was attending MIT (until General Hershey's folks sent him his "Greetings" letter) converted an Austin Mini from its staid 4 cylinder to an electric motored fuel cell vehicle. It was done as a project during his progression toward a Master Degree in Electrical Engineering. He told me it worked pretty well but wasn't something to use as a daily driver given the technology and availability of suitable components of the time. Fueling LH2 and LOX was somewhat problematic. Upon completion he removed his fuel cell and equipment and, for another project, reinstalled the 4 banger but reassembled it without mechanical fasteners using an experimental epoxy adhesive instead which, he said, worked much better and was a daily driver...for awhile. He went on to be an enlisted Reactor Operator on a submarine for a few years.
  • Ajla $100k is walking around money but this is almost certainly the last Dodge V8 vehicle and it's likely to be the most powerful factory-installed and warrantied pushrod engine ever. So there is some historical applicability to things even if you have an otherwise low opinion of the Challenger.And, like I said up thread, if you still hate it will be gone soon anyway.
  • Carlson Fan GM completely blew the marketing of the Volt. The commercials were terrible. You'd swear they told the advertising company to come up with an ad that would make sure no one went out and shopped a Volt after seeing it!...........LOL My buddy asked why I bought a car that only goes 40 miles on a charge? That pretty much sums up how confusing and uninformative the advertising was.
  • HunterS This thing has had more farewell tours than Cher.