Pub 11 2021 Issue 2

13 For years, one of the great myths that has persisted about the auto industry has been that franchised dealers don’t want to sell electric vehicles. It’s long past time to put this myth out to pasture. And it’s time to call it out for what it is: A lie about franchised dealers, propagated by the handful of companies that want to destroy the franchise system. now a vastly different proposition than it used to be. These are hugely positive developments. One other major thing that has changed dramatically over the years? Dealer attitudes toward selling and servicing EVs. Fran- chised dealers aren’t at all EV-reluctant and haven’t been for years. And they certainly aren’t anti-EV. Anyone that tells you differently just isn’t telling the truth. How do we know this? Cadillac. Last fall, after Cadillac announced plans to abandon in- ternal combustion engines altogether and move entirely to battery-electric drivetrains, the nation’s 880 Cadillac dealers faced a choice. If they bought into Cadillac’s vision for an all-electric future, they could pony up a minimum of $200,000 of their own capi- tal for the in-store charging infrastructure, tooling and training that Cadillac was mandating. Conversely, if they either didn’t want to be part of that all-electric future or didn’t want to make the required investment, they could accept a buy-out from the automaker and wind down their franchises. What happened next wasn’t surprising to anyone who under- stands dealers and how their thinking has evolved. More than 80% of Cadillac dealers said they were all in — not just to sell EVs, but to sell EVs exclusively, and they backed up that commitment with significant capital investments that will take time to mature. Most of the 20% that opted out were small stores in markets where Cadillac hasn’t performed well, and most of these deal- ers accepted the buy-out because of economic conditions on the ground, not out of concern about the brand’s future product plans. And certainly not because they were anti-electric. For example, one Cadillac dealership in northern Minnesota took the buy-out because it sells fewer than 50 new cars per year, and the required $200,000 investment was too steep given the small size of its market.