Cadillac dealers are jumping ship rather than upgrade for EV sales, report says

GM's luxury arm is paying dealers unwilling to invest in EV sales to give up their franchise agreements.

Kyle Hyatt Former news and features editor
Kyle Hyatt (he/him/his) hails originally from the Pacific Northwest, but has long called Los Angeles home. He's had a lifelong obsession with cars and motorcycles (both old and new).
Kyle Hyatt
2 min read
2023 Cadillac Lyriq

Cadillac wants to make EVs its future, but some dealers aren't on board.


As Cadillac gears up to become a manufacturer of electric vehicles, it's reached a point where it needs to start preparing its dealer network for the change. This means lots of costly and mandatory upgrades to their facilities for franchised dealers unless GM gives them a way out of their franchise agreements.

According to a report published Friday by the Wall Street Journal, that's precisely what GM is doing. Specifically, GM is giving Cadillac dealers a choice between giving up their ability to sell any Cadillac and taking a buyout or investing hundreds of thousands of dollars into an uncertain future.

Currently, there are around 880 Cadillac dealers in the US, and based on WSJ's reporting, as many as 150 of them have taken GM's buyout for dollar figures ranging from around $300,000 to as much as $1 million. This makes sense since many of these dealers also sell other GM lines like Chevrolet, Buick and GMC, and their Cadillac business may only account for a very small part of their overall yearly sales.

"The future dealer requirements are a logical and necessary next step on our path towards electrification," said Rory Harvey, global brand chief for Cadillac, in a statement. "Those who aren't ready to make that commitment are getting fair compensation for exiting the brand."

The trepidation from the dealer network is understandable when you look at the changes in the auto industry as a result of the COVID-19 pandemic and with the public's relatively slow adoption of electric vehicles. Add in Cadillac's unproven record with EVs, and that leaves a lot of room for things to go wrong.

Cadillac expects its first production EV, the Lyriq SUV, to hit showrooms in late 2022.

The Cadillac Lyriq electric SUV is ushering in a new era at GM

See all photos