GMC HUMMER EV Forum | HummerChat.com banner
1 - 6 of 6 Posts

·
Premium Member
Joined
·
503 Posts
Discussion Starter · #1 ·
GM is getting more involved in how their dealers are going to sell the Hummer. GMC is making dealers sign an “electric models participation agreement" where GMC customers must place a reservation for the Hummer EV online and dealers will only receive inventory based on those customer reservations, rather than bulk inventory.

GM is also encouraging no-haggle pricing for the Hummer EV.


General Motors is looking to be more involved in the buying process for its new GMC Hummer EV pickup truck and SUV models, encouraging no haggle pricing and limiting the amount of inventory dealerships have access to.

Automotive News recently obtained a copy of the “electric models participation agreement” that GMC is making dealerships sign in order to be entitled to sell the GMC Hummer EV and its other future Ultium-based battery-electric models. Under this agreement, GMC customers must place a reservation for the Hummer EV online and dealers will only receive inventory based on those customer reservations, rather than bulk inventory.

GMC is also encouraging no-haggle pricing for the Hummer EV. While set prices are not part of the participation agreement, it does indicate that customers agree to the suggested retail price when ordering online and can then negotiate the final price with the dealership afterward. The base price for the 2022 GMC Hummer EV Final Edition that will enter production next year is $112,995.

A GMC spokesperson told AN the company is still ironing out the kinks with regard to the unilateral pricing model, so the strategy may still be subject to change.

“We’re still working through the details,” GMC spokeswoman Michelle Malcho told the publication. “We have no comment at this time.”

GMC boss Duncan Aldred said the goal with the set pricing structure is to discourage dealers from price-gouging customers for the Hummer EV, which is expected to be in high demand, and remove some of the confusion from the vehicle process.

“There will be no incentives. There will be no trickery,” Aldred said in October, as quoted by AN. “We are trying to construct a dealer margin in such a fashion that it really is a no-haggle price.”

Additionally, the agreement reserves GMC’s right to limit a dealership’s communication with Hummer EV customers and mandates they must communicate with them manually and not through automated messaging, e-mail or voicemail.

Some dealers aren’t happy with this new model – especially after GM asked them to invest $200,000 or more in facility upgrades to sell and service advanced EVs like the GMC Hummer EV. GM makes no guarantee that dealerships who agree to make these required investments will receive Hummer EV allocation early on

GM, for its part, hopes that strong profit margins and demand for vehicles like the GMC Hummer EV will keep dealers happy as it shifts to this new sales method for EVs. It also hopes that by taking some of the “waste” of the vehicle buying process, it can improve the experience for customers, as well.
 

·
Registered
Joined
·
767 Posts
GM is getting more involved in how their dealers are going to sell the Hummer. GMC is making dealers sign an “electric models participation agreement" where GMC customers must place a reservation for the Hummer EV online and dealers will only receive inventory based on those customer reservations, rather than bulk inventory.

GM is also encouraging no-haggle pricing for the Hummer EV.


General Motors is looking to be more involved in the buying process for its new GMC Hummer EV pickup truck and SUV models, encouraging no haggle pricing and limiting the amount of inventory dealerships have access to.

Automotive News recently obtained a copy of the “electric models participation agreement” that GMC is making dealerships sign in order to be entitled to sell the GMC Hummer EV and its other future Ultium-based battery-electric models. Under this agreement, GMC customers must place a reservation for the Hummer EV online and dealers will only receive inventory based on those customer reservations, rather than bulk inventory.

GMC is also encouraging no-haggle pricing for the Hummer EV. While set prices are not part of the participation agreement, it does indicate that customers agree to the suggested retail price when ordering online and can then negotiate the final price with the dealership afterward. The base price for the 2022 GMC Hummer EV Final Edition that will enter production next year is $112,995.

A GMC spokesperson told AN the company is still ironing out the kinks with regard to the unilateral pricing model, so the strategy may still be subject to change.

“We’re still working through the details,” GMC spokeswoman Michelle Malcho told the publication. “We have no comment at this time.”

GMC boss Duncan Aldred said the goal with the set pricing structure is to discourage dealers from price-gouging customers for the Hummer EV, which is expected to be in high demand, and remove some of the confusion from the vehicle process.

“There will be no incentives. There will be no trickery,” Aldred said in October, as quoted by AN. “We are trying to construct a dealer margin in such a fashion that it really is a no-haggle price.”

Additionally, the agreement reserves GMC’s right to limit a dealership’s communication with Hummer EV customers and mandates they must communicate with them manually and not through automated messaging, e-mail or voicemail.

Some dealers aren’t happy with this new model – especially after GM asked them to invest $200,000 or more in facility upgrades to sell and service advanced EVs like the GMC Hummer EV. GM makes no guarantee that dealerships who agree to make these required investments will receive Hummer EV allocation early on

GM, for its part, hopes that strong profit margins and demand for vehicles like the GMC Hummer EV will keep dealers happy as it shifts to this new sales method for EVs. It also hopes that by taking some of the “waste” of the vehicle buying process, it can improve the experience for customers, as well.
Basically GM is going to batch build the Hummer EV, and send them to dealers as orders come in, local dealers will have 1 Hummer EV in the showroom to look at, but none in inventory reducing the dealers typical financing cost. GM is taking a page out of Tesla's model, so anyone buying a Hummer EV will be waiting some period of time between order and delivery. My local dealer is just building a new GMC store so it was the perfect time for them to add the DC fast Chargers, and they also own a Cadillac store that is just completing construction next door, so they caught this at the perfect time. They would not tell me the Hummer EV reservations they have now, other than to say several in addition to mine.

Dealers currently do not make much on new car sales, as most customers negotiate the price. Dealers make money on used cars, finance and warranty sales, and service. It sounds like GM is trying to set up a front end profit on the EV's so that dealers feel comfortable about losing some of that service revenue, and also having a big up front investment into EV related hardware. My dealer seems excited about the EV's.
 

·
Premium Member
Joined
·
503 Posts
Discussion Starter · #3 ·
Basically GM is going to batch build the Hummer EV, and send them to dealers as orders come in, local dealers will have 1 Hummer EV in the showroom to look at, but none in inventory reducing the dealers typical financing cost. GM is taking a page out of Tesla's model, so anyone buying a Hummer EV will be waiting some period of time between order and delivery. My local dealer is just building a new GMC store so it was the perfect time for them to add the DC fast Chargers, and they also own a Cadillac store that is just completing construction next door, so they caught this at the perfect time. They would not tell me the Hummer EV reservations they have now, other than to say several in addition to mine.

Dealers currently do not make much on new car sales, as most customers negotiate the price. Dealers make money on used cars, finance and warranty sales, and service. It sounds like GM is trying to set up a front end profit on the EV's so that dealers feel comfortable about losing some of that service revenue, and also having a big up front investment into EV related hardware. My dealer seems excited about the EV's.
That's a good point about keeping dealers happy with selling EVs. I'd be curious to see what other things are included in this “electric models participation agreement".
 

·
Premium Member
Joined
·
503 Posts
Discussion Starter · #4 ·
Speaking of which, while GMC dealers might be satisfied about selling the Hummer EV, Cadillac dealers would rather leave the brand than sell EVs!


Dealerships might hamper GM’s plans to electrify its cars. Wall Street Journal tipsters claim that roughly 150 GM dealerships in the United States have decided to drop the Cadillac brand and accept a buyout (ranging from $300,000 to over $1 million) rather than spend about $200,000 to upgrade the dealerships with charging stations, repair hardware and other equipment needed to sell EVs. Many of these dealerships only sell a few Cadillacs per month versus more for Buick, Chevrolet and GMC, but it’s still a significant blow when GM has 880 Cadillac dealers in the country.

Cadillac brand leader Rory Harvey confirmed to the WSJ that GM was offering buyouts, but didn’t say how many dealers took them or how much they were worth.
 

·
Super Moderator
Joined
·
551 Posts
Speaking of which, while GMC dealers might be satisfied about selling the Hummer EV, Cadillac dealers would rather leave the brand than sell EVs!

Dealerships might hamper GM’s plans to electrify its cars. Wall Street Journal tipsters claim that roughly 150 GM dealerships in the United States have decided to drop the Cadillac brand and accept a buyout (ranging from $300,000 to over $1 million) rather than spend about $200,000 to upgrade the dealerships with charging stations, repair hardware and other equipment needed to sell EVs. Many of these dealerships only sell a few Cadillacs per month versus more for Buick, Chevrolet and GMC, but it’s still a significant blow when GM has 880 Cadillac dealers in the country.

Cadillac brand leader Rory Harvey confirmed to the WSJ that GM was offering buyouts, but didn’t say how many dealers took them or how much they were worth.
Honestly, I heard about this and was pretty impressed. Not because I want people to lose jobs at dealerships (I'm sure most will be retained at sister GMC/Buick dealers), but because GM has been DESPERATELY trying to cut their dealership count, expecially at Cadillac, for decades. The last meaningful time was during the Great Recession, but they still have far too many. For reference, I believe BMW has about 335 dealerships to Cadillac's 880. Not only do they cut extra weight and become more lean and efficient, but they now know that the remaining dealers are committed to the next generation of Cadillac.

It'll cost them some dough up front, but long-term, this is good news.
 

·
Registered
Joined
·
767 Posts
Honestly, I heard about this and was pretty impressed. Not because I want people to lose jobs at dealerships (I'm sure most will be retained at sister GMC/Buick dealers), but because GM has been DESPERATELY trying to cut their dealership count, expecially at Cadillac, for decades. The last meaningful time was during the Great Recession, but they still have far too many. For reference, I believe BMW has about 335 dealerships to Cadillac's 880. Not only do they cut extra weight and become more lean and efficient, but they now know that the remaining dealers are committed to the next generation of Cadillac.

It'll cost them some dough up front, but long-term, this is good news.

Yes, cutting Cadillac dealers is good new all around for GM, as for the workers, they will be fine, most of the dealerships that drop caddy will pick up another franchise, or start selling used cars only (more profitable).
 
1 - 6 of 6 Posts
Top