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Cadillac to buy out disgruntled dealers

by Justin King

Brand chief Johan de Nysschen suggests Cadillac has too many dealers.

Cadillac is reportedly prepared to buy out many of its US dealers as it attempts to roll out new requirements to improve its customer experience.

The brand has offered up to $180,000 incentives if dealers voluntarily walk away from their franchise agreement, according to Automotive News. The program is said to be focused on the 400 smallest dealers in the network.

Some dealers have cried foul over Cadillac chief Johan de Nysschen's controversial 'Project Pinnacle' reforms. The proposal aims to divide dealers into five categories based on project sales, each with different requirements for services and facilities.

"The winners can make the required investments and prosper," a group of dealers recently wrote in a letter to de Nysschen. "The other dealers face business failure."

The buyouts appear to be aimed at any dealers that share such attitudes, some of which sold less than 50 Cadillac vehicles last year. The bottom echelon is said to account for nearly half of the Cadillac's 925 dealers in the US, despite achieving less than 10 percent of brand sales.