By on September 17, 2020

Cadillac told U.S. and Chinese dealers they will each need to invest at least $200,000 on electric vehicle chargers and staff training to continue selling the brand’s products after 2022. The message was communicated to dealerships on Wednesday via video messages from Rory Harvey, the luxury brand’s vice president of sales, service and marketing. Cadillac is moving on electrification (seriously this time) and plans to launch the Lyriq EV within the next two years, with more battery-driven models to follow. Update: Cadillac PR has responded, saying that what was communicated yesterday is for U.S. dealers only.

The brand says dealers must be ready for the transition, giving us flashbacks to Project Pinnacle  the Johan de Nysschen strategy that forced stores to spend money to provide a more premium sales experience that differentiated Cadillac as special. At the time of its implementation, many dealers wondered why they should bother taking on more overhead under the assumption that they’ll make extra money over time. While luxury-specific outlets don’t have much choice in the matter, those selling GM’s other brands in conjunction with Cadillac seem to be substantially less eager to implement the changes.

This has especially been true in rural areas where customers may not have the option of visiting a Cadillac-specific storefront. When they go to pick up a new vehicle, they’re likely to have to walk past a couple rows of GMC or Chevrolet products. Shop owners are wondering if its worth bothering footing the bill for the upgrades, especially since EV sales are likely to be substantially lower in areas without a comprehensive charging network and that’ll be all Cadillac is offering.

Perhaps more telling is GMC confessing earlier this week that only about half of its 1,700 dealers have decided to sell the upcoming Hummer EV.

General Motors may be running the risk of segregating its market. Cadillac will have urban areas with customers that can make its luxury EVs work for them while GMC handles truck-obsessed rural areas without charging networks. It sounds a little dumb but the automaker may just be leaning into existing trends in the hopes of getting ahead of them in the United States. The Detroit News helped illustrate this by interviewing a few Caddy dealers to get their take on the mandatory upgrades.

“It’s a game changer for us,” Inder Dosanjh, a Cadillac dealer with four dealerships in the San Francisco Bay Area, told the outlet. “The current product is very hot. Electrification just really fits in our profile.”

From The Detroit News:

David Butler, chairman of the dealer council and executive manager for Suburban Cadillac, which has three Cadillac dealerships in Michigan and one in California, said the investment might be a lot for a small dealer who makes few sales in a year. But there are investments, like redoing showrooms, that are “substantially more” than $200,000.

“I have no problem investing in the brand as long as we’re going to bring buy-in behind it,” he said. “Generally $200,000 is not a number that scares most dealers, but at some point you have to start making financial decisions about whether or not this additional investment is going to be worth it for you.”

While there are “core elements” required to serve future Cadillac customers, the changes can vary by dealership, Harvey said, noting that a smaller dealership might only need one charging station. Every dealer will be contacted by a field person at GM about the transition.

Though GM’s entire decision probably has more to do with Asian sales than anything else. The People’s Republic of China has more home and work chargers than anywhere in the world. It likewise has the biggest public charging network currently in existence and has been pretty good to Cadillac vs most other American imports.

Going electric is a clear play at the PRC and ensuring the brand has continued access to Chinese customers. The Chinese Communist Party has prioritized EV adoption and has been working with global regulators on establishing deadlines for the banning of internal combustion vehicles for years. While this is being done under the auspices of environmentalism, China is also one of the biggest dogs in the yard when it comes to battery production and knows an EV-only world would it a massive trade advantage over the West. Automakers are well aware of this, which is one reason you see global brands doing a lot of business within the country (e.g. Volkswagen and GM) focusing on electric cars a little harder than their peers.

More from Cadillac: “While we do see great opportunity for EV’s in China, this is not the reason for the new standards. We also see great potential in U.S. but we need to get the network prepared. This is the logical next step on our path toward EVs.”

.[Image: Lerner Vadim/Shutterstock]

Get the latest TTAC e-Newsletter!

31 Comments on “More Dealer Drama from Cadillac and the China Connection [Updated: Cadillac Responds]...”

  • avatar

    China might be land of the charging station in sheer numbers. Where does China come by stations be capita? That would provide a better yardstick of how far the tech has become popular.

  • avatar

    What is going to happen when these EV Cadillacs fail to find customers. Remember, Cadillacs only sold 1500 Cadillac (volt-based) EVs in its final year! There is going to be a Cadillac dealership rebellion. This could lead to an exodus of Cadillac dealerships to other brands.

  • avatar

    What is going to happen when these EV Cadillacs fail to find customers. Remember, Cadillacs only sold 1500 Cadillac (volt-based) EVs in its final year! There is going to be a Cadillac dealership rebellion. This could lead to an exodus of Cadillac dealerships to other brands.

    • 0 avatar
      SCE to AUX

      The ELR was a turd with terrible performance, requiring duel-fuel care. Total sales of the ELR were only 2874 in the US, with 534 in its last year.

      Duel fuel vehicles (PHEVs) are niche of a niche (alternative fuel vehicles), and Cadillac was on the wrong side of history with that product. Even the Volt – with its many virtues – has been killed off and not replaced.

      Meanwhile, Tesla’s Model S outperformed and outsold the ELR while selling at higher prices.

      If Cadillac can produce a compelling BEV in the Lyriq, maybe they’ll have a sustainable business.

      If GM is serious about an electric future, then all their dealers will need upgrades to support it – not just Cadillac. The trucks are coming, too.

    • 0 avatar

      Cadillac was trying to sell a $75k 2 door Chevy Volt with the same powertrain. What did they think was going to happen?? If they had priced it at $45k then at least it wouldn’t have been an absurdity.

  • avatar
    R Henry

    I consider reading about Cadillac the same as reading about Richard Nixon. HE’S DEAD!

  • avatar

    “Perhaps more telling is GMC confessing earlier this week that only about half of its 1,700 dealers have decided to sell the upcoming Hummer EV.”

    GM has never listened to its dealers, and dealers are the foot soldiers in car wars.

  • avatar

    Local cadillac dealer to me is also a Buick GMC point. I’m guessing this doesn’t interest them much.

  • avatar

    Last time I thought about Cadillac with any degree of seriousness was when the ATS came out, and just sitting in one cured me of that.

    • 0 avatar

      The XT4 is a poster child for what is wrong with Cadillac. Very little or NO brand equity any longer. If you want to climb back into the sales battle, Cadillac will have to emulate Lexus and offer more for the same or less $$$. You can’t have coarse, under powered engines and a lack of full safety equipment and expect “luxury” buyers to flock in. When the upgrades of engine and trim are added in, a Cadillac is more costly than many other luxury brands. They also have the albatross that when you drive up somewhere in a new Cadillac, instead of congratulations you get condolences.

      • 0 avatar

        And to think, if you want your hand on a GM vehicle in Europe, you have your choice of a Corvette or an XT4. Nothing else.

        Whose brilliant idea was that? I mean, Corvette I understand, but XT4? That was GM’s idea of the best that they offer?

  • avatar
    schmitt trigger

    Definition of oxymoron:
    Cadillac and Luxury Vehicle in the same sentence.

  • avatar

    Caddy Daddy sees the headline picture and weeps for the good ol’ days!

  • avatar

    In just over five year all these GM EVs will disappear. Many GMC dealers have already expressed disinterest in the EV Hummer. GM had never had an EV that has broken the annual 20,000 sales barrier. Currently, Bolts sales are right at the bottom of the sales chart with the Fiat 500. The truth is GM would sell more Cruzes in one year than the Bolt would in a decade!!

    Like Jim Hackett of Ford, Barra will eventually be forced out. Maybe then sanity will be returned to GM.

    • 0 avatar

      And yet, Tesla is selling every car they make and has waiting lists.

      You’re kind of implying that EVs are a dead end, but what’s really happening is that Tesla is beating GM at the EV game.

      • 0 avatar

        It’s not that Tesla is beating them…

        It’s that the people who want electric cars generally refuse to be caught dead in a GM product.

        Meanwhile, the people that want to buy GM products don’t really care for electric cars.

        If Toyota tried to compete with Tesla, it would probably win.

      • 0 avatar

        Remember,when people purchase a Tesla they are buying into an exotic brand name. They are also buying into the Elon Musk mystique. In this respect Elon Musk is similar to Steve Jobs of Apple. You could say Apple and Tesla buyers are part of a devoted consumer cult. GM simply does not have that kind of brand devotion.

      • 0 avatar
        Art Vandelay

        Everybody sells every car they make. Do you thing other companies just put a crusher at the end of the assembly line?

      • 0 avatar

        Despite all the press conferences and 5 year plans, the legacy automakers really just don’t take EV’s seriously.

  • avatar

    Communism rocks! China is ahead of USA! Where are headlines? MSM as usual is at sleep. We want communism! We want communism!

    Well are Cadillac dealerships so poor that cannot install EV charger in dealership? How are they going to transition to the Future? Or they are planning to stay behind forever and somehow survive? How is it possible?

  • avatar

    Glorious chargers installed by glorious Cadillac Dealers for glorious people in a glorious nation.

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • ToolGuy: Best-looking vehicle currently assembled in Alabama or Georgia isn’t made in Alabama and isn’t a...
  • probert: I drive my EV and have few issues. I am fortunate to be able to charge at home, and have stations along my...
  • probert: Well, just to note, the leaf is one of the lowest range EVs available. Most EVs are a lot of fun to drive...
  • Art Vandelay: Still better styling than Korean cars
  • probert: No, they are not.

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Jo Borras
  • Mark Baruth
  • Ronnie Schreiber