Some state dealer groups are demanding that Cadillac scrap its controversial new dealer-incentive program, Project Pinnacle, claiming brand chief Johan de Nysschen's vision for transforming the retail network would violate franchise agreements and intentionally cull smaller stores.
In a sharply worded letter to de Nysschen dated Aug. 3 and obtained by Automotive News, seven state dealer association heads say Project Pinnacle would create several tiers of "effective pricing," as Cad-illac funnels a disproportionate amount of money to larger, urban stores that are better able to make pricey investments in services such as complimentary roadside assistance.
Project Pinnacle "picks winners and losers," the letter says. "The winners can make the required investments and prosper. The other dealers face business failure."
In a separate letter to de Nysschen from Automotive Trade Association Executives dated July 22, the group, which represents executives from state and metro dealer associations, says Project Pinnacle's tiered structure might run afoul of state franchise laws that prohibit manufacturers from price discrimination among dealers.