4 ms·

Yeah I wouldn’t read too much into this. It’s good for the brand to cull the heard of non-believers.

AnimalMuppet 6y ago
First, it's a "herd". Second, 17% is a lot of dealerships. I mean, I presume that these are the dealerships that aren't selling all that many cars, but... what total sales volume did they account for. 5%? 10%? Does Cadillac want to lose that much of their total sales? Do they want to pay money to lose that much of their total sales? And, really, pay $300,000 for a dealership to go away, because the dealership wouldn't pay $200,000 for a charging station. Why not, you know, put up the $200,000, and keep the dealership?
- krrrh 6y ago
  Cadillac is a sub brand of GM, and most of these dealers probably did small volume on Cadillacs while their bread and butter was GM. For instance I consulted a group of Ford dealerships, only one of which had a Lincoln franchise. To keep the Lincoln brand they needed to do stuff like have a separate branded entrance and minumum floorspace for the Lincoln side of things, etc. At some point it’s not worth it if 95% of your revenue comes from selling the mainline brand.
  - Scoundreller 6y ago
    I wonder if, at some point, a brand will subsidize those costs just to keep a foot in a market (if they fail to take the bait and cover the cost themselves).
- deleted 6y ago
  [deleted]
- unreal37 6y ago
  They'd have to pay $200,000 to all dealerships, not just the ones who wanted to leave. Plus I am sure that equipment takes up land/space, and reduces the number of service bays. And requires trained staff. $176 million is different than $20 million. And that's not the only cost the dealers are incurring including reduced revenue from land that could be used to sell cars.
- electriclove 6y ago
  Because they want to get rid of dealerships. ;)
- nitrogen 6y ago
  And, really, pay $300,000 for a dealership to go away, because the dealership wouldn't pay $200,000 for a charging station. Is a franchise something that a dealer has to purchase up front? If so, maybe it's sort of like property, and Cadillac has to buy it back from them? I believe at least the first part is how some e.g. restaurant franchises work.

First, it's a "herd". Second, 17% is a lot of dealerships. I mean, I presume that these are the dealerships that aren't selling all that many cars, but... what total sales volume did they account for. 5%? 10%? Does Cadillac want to lose that much of their total sales? Do they want to pay money to lose that much of their total sales? And, really, pay $300,000 for a dealership to go away, because the dealership wouldn't pay $200,000 for a charging station. Why not, you know, put up the $200,000, and keep the dealership?

krrrh 6y ago
Cadillac is a sub brand of GM, and most of these dealers probably did small volume on Cadillacs while their bread and butter was GM. For instance I consulted a group of Ford dealerships, only one of which had a Lincoln franchise. To keep the Lincoln brand they needed to do stuff like have a separate branded entrance and minumum floorspace for the Lincoln side of things, etc. At some point it’s not worth it if 95% of your revenue comes from selling the mainline brand.
- Scoundreller 6y ago
  I wonder if, at some point, a brand will subsidize those costs just to keep a foot in a market (if they fail to take the bait and cover the cost themselves).
deleted 6y ago
[deleted]
unreal37 6y ago
They'd have to pay $200,000 to all dealerships, not just the ones who wanted to leave. Plus I am sure that equipment takes up land/space, and reduces the number of service bays. And requires trained staff. $176 million is different than $20 million. And that's not the only cost the dealers are incurring including reduced revenue from land that could be used to sell cars.
electriclove 6y ago
Because they want to get rid of dealerships. ;)
nitrogen 6y ago
And, really, pay $300,000 for a dealership to go away, because the dealership wouldn't pay $200,000 for a charging station. Is a franchise something that a dealer has to purchase up front? If so, maybe it's sort of like property, and Cadillac has to buy it back from them? I believe at least the first part is how some e.g. restaurant franchises work.