Number of the Day

Car Dealers Opting Out of the Electric Revolution, by the Numbers

17% of the country’s Cadillac dealers accepted a buyout from GM rather than invest in electric car infrastructure

Photo illustration, source: Karen Bleier/AFP/Getty Images

150: That’s how many Cadillac dealers have opted to no longer sell the brand rather than invest in electric car infrastructure.

This was the ultimatum from GM to the dealers: Install $200,000 worth of electric car charging infrastructure, heavier lift equipment to accommodate weightier electric vehicles, and specialist tools, or accept a buyout and give up the Cadillac brand. The buyouts were attractive—$300,000 to $1 million, the Wall Street Journal reported—and about 17% of the country’s Cadillac dealers accepted the exit offer.

This isn’t surprising: Since the start of the new EV age a decade ago, dealers have been asking, “What’s in it for me?” They generally haven’t been hopeful that they’ll be able to sell many EVs — or that they would earn very much commission by doing so. With their lack of conviction, dealers adopting this credo have arguably contributed to making the decade’s anemic non-Tesla EV sales a fait accompli.

But the opt-out also gets to the heart of the EV revolution. We have a loud supply-side signal: Across the globe, automakers are piling in with plans to deploy dozens of EV models onto the market. What we don’t have yet is a demand signal; no one knows whether large numbers of motorists will buy the EVs, or whether they will instead stick with the combustion technology they know. The Cadillac dealers that opted out appear to be betting on the latter — that while there may be an EV revolution, the spoils seem likely to accrue mainly to Tesla. GM and the other major legacy auto companies are gambling that the former is true: that all stand to gain. It’s a cards-up poker game, the conclusion to which will come in the next five or so years.

Gives a whole new meaning to “Cadillac tax.”

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