Hundreds of US Car Dealerships Abandon Buicks. Are EVs to Blame?

As General Motors prepares to roll out electric versions of its Buicks, "hundreds of Buick dealerships nationwide" are "turning their backs on the storied brand," reports the Boston Globe. "The move to electric Buicks is one reason so many dealers are giving up their Buick franchises, according to auto industry watchers."They say that smaller, low-volume Buick dealers either can't or won't make the big investments needed to begin selling EVs, especially as sales growth in the sector has cooled and unsold electrics are piling up on dealer lots. "I think there are dealers who are just not confident in the electric vehicle transition and they don't want to have to commit to the investment," said Karl Brauer, executive analyst at online car retailer iSeeCars.com... Buick has announced its intention to migrate to an all-electric line of cars by the end of the decade. The brand's first EV is set to go on sale this year. But getting ready to sell EVs is a costly proposition. Dealers must purchase new equipment to service the cars and must pay for worker retraining. GM estimates that the upfront cost to dealers will range between $200,000 and $400,000. "If you're in a market where you're not selling a lot of Buicks, investing a lot to sell electric Buicks may not make a good business case," said Mark Schirmer, spokesperson for Cox Automotive, an Atlanta-based automotive marketing company. While 854,000 Buicks were sold in 1980, just 103,000 were sold in 2022 - down from 207,000 in 2019, according to the article. So in 2022 GM bought out 44 percent of its dealerships (which they say accounted for just 20% of all U.S. Buick sales), with the majority of them still selling other GM brands like Chevrolet and GMC. But the article also includes some perspective from Robert O'Koniewski, executive vice president of the Massachusetts State Automobile Dealers Association. "The only reason GM has kept the Buick alive is that it's popular in China."That's Buick's biggest market by far, thanks to a 50-50 joint venture it launched in 1997 with government-owned SAIC Motor, China's biggest carmaker. The partnership sold 653,000 Chinese Buicks in 2022. But that's a big decline from the 926,000 sold in 2020. Brauer said that Chinese consumers are pulling away from the US brand in favor of Chinese companies like BYD, which passed Tesla in the fourth quarter of 2023 to become the world's largest maker of electric vehicles.

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