General Motors will offer buyouts to U.S. Buick dealers who don’t want to make investments related to the brand’s all-electric transition, the head of Buick said in an interview with The Wall Street Journal published Friday.
All of Buick’s roughly 2,000 dealerships will be given an opportunity to take a buyout, Global Buick boss Duncan Aldred said in the interview. That would mean giving up the franchise and no longer selling Buicks, but most dealers also sell other GM brands, the Journal noted, adding that Aldred was scheduled to outline this plan at a virtual dealer meeting Friday.
“Not everyone necessarily wants to make that journey, depending on where they’re located or the level of expenditure that the transition will demand,” Aldred said in the interview. “So if they want to exit the Buick franchise, then we will give them monetary assistance to do so.”
Aldred did not say how many Buick dealers are expected to take the buyout. A similar program for Cadillac begun in 2020 and completed last year reduced the luxury brand’s dealer network by about one-third, to approximately 560 dealers. The average buyout was around $200,000 but ranged into seven figures, GM said at the time.
Many Cadillac dealers that took the buyout were in rural areas, where EV sales are expected to remain low, GM said at the time. Shifting to all-EV sales also requires dealers to invest in charging hardware and additional staff training, while limiting potential revenue from regular maintenance, which EVs require less of than internal-combustion vehicles.
Both Buick and Cadillac plan to sell only electric vehicles by 2030. Buick doesn’t currently sell any EVs in the U.S., but will release its first U.S.-market EV in 2024. All forthcoming Buick EVs will use the Electra name plus an alphanumeric suffix to denote size and body style, and will share Ultium battery packs and motors with EVs from other GM brands.
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