GM offers to buy out Buick dealerships that don’t want to sell EVs – FutureCar.com

author: Vineeth Joel Patel

General Motors has announced that it only wants to sell zero-emission vehicles by 2035. For GM’s brands, that means big changes are afoot. Buick, one of GM’s luxury brands, has said it will become an all-electric automaker by 2030. This puts Buick at the forefront of GM’s electrification goals and makes the automaker more relevant than ever. . Unfortunately, this also puts dealers in an awkward position.

GM offers Buick dealers a way out

With Buick on the verge of going all-electric, GM will offer everyone a buy-back plan for all of its Buick dealerships in the United States, the Wall Street Journal reports. All Buick dealers, of which there are about 2,000 nationwide, will have the option of accepting a buyout deal from GM. The buyout gives Buick dealers who don’t want to make the necessary investments to sell and service electric cars a way out of selling Buicks. Dealerships that accept GM buyouts will not be able to sell Buicks, but may continue to sell other GM vehicles.

The outlet spoke with Buick global chief Duncan Aldred, who confirmed the buyout plan. As Aldred points out, dealerships will need to invest heavily in their operations. Installing electric car chargers, purchasing the necessary equipment to service electric vehicles, and properly training staff to sell electric cars is a significant investment. GM understands that not everyone is interested in investing.

“Not everyone necessarily wants to take this trip, depending on where they are or the level of expense the transition will require,” he said. “So if they want to leave the Buick franchise, we will give them financial assistance to do so.”

Buybacks for GM become normal

As Aldred claims, investing a large sum of money to ensure a dealership has everything it needs to sell and service electric cars is not going to be feasible for many dealerships. Dealerships in parts of the country where electric vehicles aren’t popular won’t see a return on their investment for years or decades. All of this also depends on how competitive Buick’s electric vehicles are in the market. The Wall Street Journal says upgrading a facility can require an investment of over $300,000.

GM has not provided any information on how many dealerships it expects will accept the buyout or what kind of requirements it will impose on dealerships wishing to sell Buick electric vehicles. Speaking to Reuters, a Buick spokesperson said: “Future dealer requirements are a logical and necessary next step on our path to electrification to ensure our dealers are ready to sell and properly service these vehicles. unique.”

A few years ago, GM offered Cadillac dealers a similar buyout plan. About a third of GM’s Cadillac dealerships accepted the buyout. GM spent about $274 million in costs to buy out the Cadillac dealerships. Reports say GM expected Cadillac dealerships to spend between $200,000 and $500,000 on equipment and training to support its transition to an electric brand.

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