Dealer Backlash Grows Against Cadillac's 'Project Pinnacle'

Steph Willems
by Steph Willems
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dealer backlash grows against cadillac s project pinnacle

A dealer association in California is the latest group to go after Cadillac, demanding the automaker make changes to its controversial “Project Pinnacle” sales incentive program.

The California New Car Dealers Association, acting at the request of 52 dealers in that state, has sent a letter to General Motors CEO Mary Barra in a bid to delay (and alter) the project, Automotive News reports.

Unveiled in early June, the program is the brainchild of brand president Johan de Nysschen. It aims to split U.S. dealers into five tiers based on expected sales. The dealers must then offer an enhanced sales experience and more customer niceties — the higher the tier, the more luxurious the sales experience. Compensation from the automaker would be tied to sales performance.

Many dealers take issue with the program, which begins on January 1. Earlier this summer, dealer groups in seven U.S. states slammed the plan in a letter to de Nysschen, claiming the project would funnel most of the cash to large urban dealers, endangering smaller dealers.

The California association claims the program saddles dealers with “unreasonable” performance standards and facility upgrades, and violates eight state franchise laws. Project Pinnacle also discriminates against smaller dealers, the group claims.

In response to dealer protests, Cadillac has reportedly extended the deadline for entry into the voluntary program until September 30 and made some minor changes to the program itself. de Nysschen previously told Automotive News that many of the criticisms of the program are caused by misunderstandings, and maintains that Project Pinnacle is legal.

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

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  • Healthy skeptic Healthy skeptic on Sep 07, 2016

    I'll be honest: I have a real hard time being sympathetic towards any dealer complaints, as long as there are laws on the books forbidding direct car sales, and making it darn near impossible to terminate a franchise relationship. These laws did not appear by magic. The dealers lobbied to get them on the books, and still lobby to keep them there. GM and all other manufacturers should be permitted to get a franchise divorce pretty much whenever they want, or at least once a contract expires. Why should they be saddled with bad middlemen? If GM could purge the weak sisters, you wouldn't have this problem so much in the first place. I'm surprised more attention here at TTAC isn't devoted to the underlying cause of all this. Car dealer state franchise laws really need an overhaul. This story is more a symptom of that.

    • Dal20402 Dal20402 on Sep 07, 2016

      If TTAC really focused attention on that, the site would implode from the sheer weight of Ruggles' outraged comments.

  • Rday Rday on Sep 07, 2016

    this is really a dead brand going nowhere. Put a bullet thru its brain. No person with any brains or self respect would even consider one of there products anyway...just pimps, drug pushers and overpaid athletes will miss them anyway. I don't know of any person that actually owns one of these so called luxury cars so i guess that proves how smart and enlightened my friends are.

  • Stephen Stephen on Sep 07, 2016

    I'm sure GM has a bunch of surveys stating customers have better experiences at MB,Lexus,BMW than they do at Cadillac.So GM decided to throw money at dealers so they would improve their customer experience. The more the dealer does for the customer,the more they get. Problem is,there's probably a customer satisfaction score that the dealers have a problem with. But Cadillacs bigger issue is they threw away 70 years of being America's Luxury Car/Brand to try and become America's BMW. Last week read a Cadillac ad and it was all about performance. Why? Who the heck thinks of Cadillac as a performance brand?

    • Speedlaw Speedlaw on Sep 07, 2016

      I surprise a lot of folks with the FE3 3.6 CTS....... the six has good bark in passing situations. Anything substantially faster is a dedicated sportscar...

  • Speedlaw Speedlaw on Sep 07, 2016

    The number of dealers is a very interesting phenom. I don't doubt that Caddy wants to dump a lot of them. When I went looking for BMW dealers in my area, there are four, each reasonably separated. Acura ? Two in my area, one a bit further away. MB ? Like BMW, four in the area. Caddy ? Lots more than the others...maybe a result of the age of the brand and reflecting back when GM had 50% of the market. Infiniti ? There's one where the mother ship doled them out sparingly. Far enough apart even in NYC to make cross shopping inconvenient. If I'm going to have a franchise, I want AREA. We have two caddy shops nearby. The one in the City of White Plains tries to go whole hog, with marble, wood grain, very pretty greeter at the door. Looks like the BMW dealer but with less "ikea". No other brands to sully things. My local-local Caddy shop pairs with Chevy and GMC. They look way more old school. Whoever hires the salespeople hires on looks..practically models. Even the slightly chubby girl in accounting is a knockout. This dealer has been there forever, but even though both shops are cordial and such, I agree that the experience would be different-one is the BMW/MB new showroom experience and the other looks like when you went with your dad as a teen to car shop. Upstate, and where I got my car, is a mixed Cad/Buick shop, and I get the idea Buick is kinda the ignored stepchild in that place. Still, there are LOTS more Caddy shops per sq mile than any other. I am SO happy I didn't get that job I interviewed for in the 90's as "Dealership Performance Manager".

    • 28-Cars-Later 28-Cars-Later on Sep 07, 2016

      "I don’t doubt that Caddy wants to dump a lot of them." Woulda, shoulda, coulda.