Home Auto News Approximately Half of Buick Dealerships Accept Buyout Instead of Investing in EVs

Approximately Half of Buick Dealerships Accept Buyout Instead of Investing in EVs

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Buick Dealership Buyouts

In 2022, General Motors initiated a program offering buyouts to Buick dealers in the United States who were reluctant to invest in the infrastructure necessary for the sale and maintenance of forthcoming electric vehicles. This initiative has found considerable acceptance among dealers.

Buick’s executive, Duncan Aldred, in a discussion with Automotive News (requiring subscription), revealed that the post-2023 landscape will see around 1,000 Buick dealerships operating in the U.S. This figure signifies a reduction of nearly 47% from the count at the beginning of the year, as per Automotive News’ data.

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Aldred noted that the departing dealerships accounted for just 20% of Buick’s sales in the U.S. He also highlighted that around 89% of the U.S. population remains within a 25-mile radius of a Buick dealership.

While Aldred did not disclose the specific amounts of the buyouts, a similar strategy employed with Cadillac’s dealerships involved offers starting at $200,000, extending to the million-dollar range. This varied based on each dealership’s performance. Approximately one-third of Cadillac dealers chose to step away from the brand’s shift towards electric vehicles.

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Numerous Buick dealerships also represent other brands. Those accepting the buyout might now concentrate on these alternate brands.

Additionally, some dealers, particularly in rural areas, assessed that their potential sales of EVs would be minimal. Consequently, they deemed it unnecessary to invest in the training, tools, and equipment needed for electric vehicles. The required investments for the remaining dealerships have been estimated to be between $300,000 and $400,000.

The recent surge in interest rates has further complicated sales, possibly influencing some dealerships’ decisions to accept the buyout.

Currently, Buick offers electric vehicles like the Electra E5 in China but has yet to launch any in the U.S. However, this is set to change with Buick’s confirmation of introducing two Ultium-based electric SUVs in the U.S. by the end of 2024. Buick anticipates transitioning its entire lineup to electric vehicles by 2030.

Frequently Asked Questions (FAQs) about Buick Dealership Buyouts

Why Did Nearly Half of Buick Dealerships in the US Choose Buyouts Over EV Investments?

In 2022, General Motors offered buyouts to Buick dealers in the US who were hesitant to invest in the necessary infrastructure for selling and servicing upcoming electric vehicles. This offer was widely accepted, leading to a significant reduction in the number of Buick dealerships. The decision was influenced by factors such as the high cost of investing in EV infrastructure, the potential low sales of EVs in certain areas, and the recent spike in interest rates making sales more challenging.

What Was the Impact of Buick Dealership Buyouts on US Sales and Service Coverage?

Buick executive Duncan Aldred stated that the dealerships opting for the buyout represented about 20% of Buick’s US sales. Despite this, around 89% of the US population still remains within 25 miles of a Buick dealership, ensuring continued sales and service coverage for the majority of customers.

How Much Did Buick Dealerships Need to Invest for EV Support?

Dealerships choosing to stay with Buick and support the sale and service of electric vehicles were expected to invest between $300,000 and $400,000. This investment was necessary for training, tools, and equipment to accommodate electric vehicles.

What Are Buick’s Plans for Electric Vehicles in the US?

Buick has confirmed plans to introduce two Ultium-based electric SUVs in the US market by the end of 2024. Additionally, the company aims to transition its entire lineup to electric vehicles by 2030. Currently, Buick offers models like the Electra E5 in China, with plans to expand its EV offerings in the US soon.

More about Buick Dealership Buyouts

  • General Motors Official Website
  • Automotive News Subscription Page
  • Buick Electra E5 Details
  • Overview of Ultium-Based EVs
  • Trends in the Automotive Industry

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MikeJ_45 December 21, 2023 - 8:40 am

wow didn’t expect so many Buick dealers to take the buyout. guess EVs are still a risky bet for some?

CarLover101 December 21, 2023 - 10:37 am

It’s kinda sad to see, but with those investment costs, can you blame them, electric vehicles are the future but that’s a lot of money upfront.

RuralRider December 21, 2023 - 12:23 pm

Living in a rural area, not surprised some dealers don’t see the point in EVs. Not much demand out here yet, and those costs are huge!

TechSavvyTom December 21, 2023 - 11:16 pm

Interest rates going up, tough times for auto sales, guess the buyout looked good for many, but what does this mean for Buick’s EV plans, will they still roll out as planned?

EcoDriveEnthusiast December 22, 2023 - 12:49 am

Buick’s really pushing for EVs huh, exciting times but what about the small town dealers, they’re getting the short end of the stick…


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