Cadillac Retail Overhaul: $800 Million in 3 Years

General Motors Co.’s plan to revamp the U.S. retail network of its Cadillac luxury brand will cost $800 million over the next three years, brand President Johan de Nysschen tells Automotive News.

The project, dubbed Project Pinnacle, will begin on April 1. It will assign Cadillac’s 924 U.S. dealerships to one of five levels based on sales volume. Larger stores will earn access to greater dividends, represented by the $800 million program cost, by investing more heavily in their own infrastructure.

De Nysschen has been simulating the scheme since October so dealers can see how they would fare. About 90% of the brand's dealers have signed up for the program. Those that haven’t account for only about 1% of Cadillac’s total sales in the U.S., which totaled 170,000 cars, crossovers and SUVs last year, according to Autodata Corp.

Smaller dealers have complained that the plan is structured to drive them out of business. De Nysschen insists the scheme will pay them all, but he emphasizes how much they earn will be up to them.