On Tuesday, Sept. 6, General Motors announced that it will give Buick franchise dealers in the US an opportunity to take a buyout to help them upgrade to electric vehicles by 2030.
Buick Offers Buyout
According to The Wall Street Journal, Global Buick chief Duncan Aldred said that all 2,000 Buick franchise dealers in the US would be given this offer.
If they choose to take the offer, they will no longer be affiliated with the Buick brand, and they can no longer sell Buick vehicles but still sell other General Motors vehicles.
In 2021, Cadillac launched the same plan for its dealers, which resulted in hundreds of Cadillac dealers closing.
According to The Verge, Buick is in the middle of rebranding as EV-only, and its goal is to make the switch by 2030.
That goal will require dealers to spend thousands of dollars on upgrades, like setting up EV chargers and EV-specific repair equipment.
Renovating stores for EV vehicles can cost around $300,000, and it could require extensive modification to a building for the extra electricity needed to charge EVs. These upgrades are required to maintain a car dealership.
The upgrade will also change how dealers do business, and many dealers have expressed their concerns about the switch to EV vehicles.
Auto News 2022 Dealer Outlook surveyed what the dealers and dealership managers think about the support for EVs. It showed that most 196 participants are unhappy with President Joe Biden's decision to go electric.
Dealers and dealership managers pointed out that EVs represent less than 10% of overall sales as not everyone can afford EVs, so customers still opt for gas-powered vehicles.
The Push to Go Electric
In February, the Biden administration rolled out a plan to allocate $5 billion to states to fund electric vehicle chargers until 2027.
This is part of the bipartisan infrastructure package that includes $7.5 billion to build a sprawling network of EV charging stations across the US.
The investment is part of President Biden's agenda to combat climate change and advance the clean energy transition.
The Biden administration has touted EVs as more affordable than gas-powered vehicles and has pledged that half the cars sold in the US will be electric by 2030.
Despite the increase in EV sales in the US in the past few years, the transportation sector is still one of the largest contributors to US gas emissions, comprising roughly one-third of emissions yearly.
Around 24% of new vehicles sold worldwide are likely to the electric by 2030, according to the consulting firm Alix Partners.
CNBC reported that the US is the world's third-largest EV market, just behind China and Europe. The program to build out charging stations could save an average driver who uses an electric vehicle up to $1,000 yearly on gasoline.
To accommodate the increasing demand for charging stations for EV vehicles, Australian company Tritium will build a manufacturing facility in Tennessee that will produce up to 30,000 chargers annually and create 500 local jobs.
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Written by Sophie Webster
