By on October 16, 2017

2017 Cadillac XT5 - Image: GM China

Imagine a traditional luxury car buyer — yes, some still exist — walks into his or her local Cadillac dealer to check out the radically refreshed 2018 XTS. Naturally, the old XTS is hanging out in the parking lot, quietly serving as potential trade-in. After entering the dealer, a salesperson ushers our buyer over to a virtual reality machine to check out the many glories (and options) that await in the new model.

On the way to that machine, the buyer passes zero Cadillacs. There’s not a CTS or CT6 or hot-selling XT5 in sight. An unlikely scenario? Perhaps. A little weird? Certainly to a repeat (read: aged) buyer. It seems small Cadillac dealers definitely felt that way, as low-volume sales locales soundly rejected head office’s plan to do away with traditional showrooms and physical cars.

As a result, Cadillac has given the ominous-sounding Project Pinnacle a makeover.

According to Automotive News, the sales plan enacted on April 1st (after dealer backlash prompted a four-month delay) has pivoted away from scrapping cars at small dealerships.

Under Project Pinnacle, dealers are grouped into four tiers. Each tier requires a certain amount of customer service-related investment by the dealership in exchange for the possibility of greater bonuses. Those dealers lower on the ladder can choose to climb another rung (through extra investment), while fourth-tier dealers were given the option of dropping to a fifth level, where a virtual reality experience would replace the traditional car-buying exercise. No showroom, no on-site inventory. Just a fancy way of looking at a car, exploring trims and colors, and a real, honest-to-God car shipped in from elsewhere.

Dropping to the fifth tier also involved a $10,000 expenditure. Small dealers, the vast majority of whom did not spring for a buyout from Cadillac last year, weren’t keen on the idea. Currently, the only VR machine in a U.S. Cadillac dealer exists in tony Greenwich, Connecticut, at a large dealer operation.

“We decided to focus on our larger dealers with respect to VR so it will become a permanent element of our new facility image for the dealers who decide to go through the voluntary facility upgrade,” said Cadillac spokesman Andrew Lipman in an email to Automotive News.

To be clear, the fifth tier is now officially off the table.

Project Pinnacle was originally scheduled to take effect on October 1st of last year, though dealer squabbling forced Cadillac to make changes to its grand plan. The automaker identified 400 low-volume dealers for a buyout, but owners rebelled after the offers proved too low. Less than 20 of the 400 dealers went for the buyout.

Some dealers accused Cadillac — and its president, Johan de Nysschen — of being heavy-handed with the project’s rollout. One owner said the offer to sign on to Project Pinnacle was akin to a “Soviet election.” Later, some saw the virtual reality option as yet another way to ditch dealers that didn’t go for the buyout.

In response to the criticism, Cadillac gave its dealers more time to understand what the project required of them, while making a few tweaks to the reward structure. Now, dealers are eligible for partial bonuses even if sales tallies fall short of Cadillac’s goals.

In the U.S. in 2017, sales of Cadillac vehicles are down nearly 5 percent, year-to-date.

[Image: General Motors]

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18 Comments on “It Turns Out Cadillac Dealers Still Want a Few Cars Kicking Around...”


  • avatar
    Hummer

    Cadillac: Come SEE our cars, don’t worry about FEEL our hard and flimsy plastics are only of the highest quality chinesium, and our tiny 4 and 6 cylinder are the buzziest.

    Sorry had to, this is just too easy.

  • avatar
    ToddAtlasF1

    I understand why Cadillac was pushing for VR. Cue looks infinitely better as a demo than it does in a car. I cross shopped a CTS V-Sport in 2015, and the interior was so appalling that I skipped the test drive. Without a car in the showroom, I’d have had no idea just how bad it could be.

  • avatar
    PrincipalDan

    Cadillac dealer here disappeared during the GM bankruptcy (dealership was Chevrolet Cadillac and had to drop Caddy). Fortunately for the ownership they also own the Toyota dealer next door. Now all the DTS in town have been traded for Avalons – lucky blue hairs even got to deal with some of the same salesmen.

    Way to go GM.

  • avatar
    mikey

    As an aging “Boomer” the Caddy name still means something to me.

    Before I bought the Mustang I considered leasing , not buying an ATS Coupe..I sat behind the wheel with “Dead Weights ” words streaming through my mind. The lease payment was something obscene. I’m thinking to myself “the dude is right” . The interior was nice enough. But not nice enough to justify that sort of coin. The engine sounded like my lawn mower.

    The Mustang is a cheap little Coupe. I paid a cheap little price.

    • 0 avatar
      ajla

      The ATS and CTS could have been a decent Nova & Chevelle and I bet they would have sold more profitably if branded as such. The CTS sells poorly everywhere, the ATS-L does okay in China but I doubt it is enough to justify the line.

      A CT6, XTS, XT5, XT7, and Escalade is plenty for Cadillac.

  • avatar
    MrGreenMan

    I had to park at the back of a medical office complex today. It looked like lease specials all along the row for the nurses and PAs – C, 3, A4, ES, etc. The two domestic luxury cars with any presence were a Lincoln Continental and a brand new Cadillac Escalade.

    That Escalade is something. Everything else Cadillac offers is invisible.

    • 0 avatar
      1BigOptimus

      I respect that opinion, and an opinion it is. You can’t tell me a sleek new CTS V or ATS V is invisible. Heck, I prefer the exterior design of both of those cars over a compatible 3 series. Most if Lexus’s look like a wide mouth bass in the front and way to many creases in the body. Most Audis look pretty sweet. Most Mercedes are just bland these days, especially the rear. It’s all a matter of opinion.

  • avatar
    EX35

    You would be crazy to buy the CTS new. One can pick up a CPO 2015 CTS for as little as $25k with under 30k miles. The question is will it be more reliable than comparable 5 series or A6? For as little as 3k more, you can pick up a similar 2015 CPO 528i or A6 2.0.

  • avatar
    I_like_stuff

    Why have a dealer at all? I can virtually see a car online without the need to go to a dealership.

    • 0 avatar
      TMA1

      Weren’t there companies back during the dot.com bubble that thought people would want to buy furniture without seeing or sitting on it? Now we look back and realize what a dumb idea that is. Of course you’re going to want seat time in something that you’re going to be in for hours at a time.

  • avatar
    jalop1991

    Grandpa wearing a VR headset. I want to see Seth MacFarlane’s take on that.

  • avatar
    stuki

    If Cadillac expended a fraction of the effort they spend on dicking around with endless dumb shit, on building better cars instead; people may actually want to buy them.

  • avatar

    Buzz Lightshare from Infiniti & Beyond and his Project Pinhead are abject failures. make great product, give dealers margin, and get the hell out of our way.

  • avatar
    Speed3

    GM needs to give it up and acknowledge that it doesn’t not have the resources or talent to right this ship. Cadillac will never become an alternative to Mercedes, BMW, or Acura.

    Spin off Cadillac and sell it to JLR or Hyundai. I bet they could do much better with the brand.

    • 0 avatar
      1BigOptimus

      Wow, that’s harsh. I don’t know if I’m buying the VR idea to that extent but selling off Cadillac to Hyundai? Come on. Do you know how long Cadillac has been around. Cadillac is a pioneer of alot of today’s car technologies like the electric starter for instance. Yeah somewhere in the middle they got side tracked with making land yachts about 20 years ago but today they still make great products. The ATS is super fun to drive. Have you driven one? The interiors may not be to everyone’s taste which is subjective, but it is high quality with real aluminum, magnesium, and leather and suede throughout the interior. A 550i I used to have, the rubberized coating on the plastics was peeling off. The point is no car company is perfect and Cadillac is in a growing stage that is moving in a positive direction. Just my opinion. I respect yours as well.

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