Times are changing for the automotive industry and Buick itself is no different. A new report suggests that the GMC sub-brand is planning to dramatically reduce its dealership network as it ramps up for an all-EV push. The brand’s global vice president, Duncan Aldred, laid out a plan that’s benchmarked against BMW, Lexus, and Mercedes-Benz.
Earlier this month we told you about how Buick is planning to offer basically all of its 2,000 dealers a buyout if they don’t want to make the switch to electric vehicles. Buick as a brand has promised that by 2030 it will only sell EVs and it’s expecting a number of its dealers to take the money as opposed to spending what could be seven figures to continue on.
Now, a new report from The Detroit Free Press suggests that the dealer headcount reduction could be almost tenfold. Aldred made clear that there’s no specific number of dealers that Buick wants or expects to take the buyout for now. Nevertheless, to hear him talk about what rival companies are doing, it sounds like Buick would be content if about 9 out of 10 dealers parted ways.
“It’s not a case where, ‘Oh we have a master plan and this is what we want.’ We’ll manage what we get,” Aldred said. “But the reality is – Buick has 2,000 dealers. We do typically 200,000 sales a year. BMW has about 300,000 sales a year and they have about 200 to 300 dealers. Lexus, the same and Mercedes-Benz is the same. Buick has the lowest throughput in the industry.”
Reducing the number of dealers overall would allow Buick to sell more cars through fewer locations which in turn would improve total profit for each dealer. With that additional capital, Buick hopes that dealers will spend more to improve the buying experience to the point that the brand can go toe to toe with the likes of Lexus, BMW, Mercedes-Benz, and others on that front.
Of course, many Buick dealers are paired with another GM brand. In fact, across the nation, only 18 standalone Buick dealerships exist. Of the ones paired up, many already have some sort of future EV infrastructure plan for Chevrolet, GMC, or Cadillac electric vehicles.