Virtual inventories, 24-hour roadside assistance and brand reputation consultants are — for now — no longer requirements of Project Pinnacle, Cadillac's ambitious and contentious program to overhaul its dealership operations.
Cadillac has again modified several of the standards to allow dealers to make a smoother transition into Pinnacle's new incentive programs. The overall structure and quarterly dealer rewards remain, but some brand-standard requirements and costs have been reduced, according to Cadillac executives and an updated September 2017 program guide obtained by Automotive News.
The changes range from top-tier dealers not being required to work with "reputation management" companies to the smallest dealers being allowed to keep physical vehicle inventories. A previously reported "exceptions process" also was implemented for the program, which launched April 1.
"We are not our dealers' enemy," Cadillac President Johan de Nysschen said in a phone interview. "We are here to work together, but it is going to require a shifting in approach over time from both ourselves and our dealer partners."
Project Pinnacle is arguably the largest overhaul of dealer operations in General Motors' history. It's part of de Nysschen's plan to position Cadillac as a stronger competitor in the global luxury market and distinguish it from GM's mainstream brands.
The program groups participating dealers, which represent 99 percent of Cadillac's U.S. sales, into one of four tiers based on sales and market area but adjusted for luxury segment growth or deterioration. Dealers can choose to move up tiers and adhere to additional requirements for enhanced rewards. Dealers in the fourth tier also may choose to drop to a fifth tier, where they aren't required to operate a traditional showroom or keep inventory.
Enrollment fees, bonuses and investment costs vary by tier. But for the most part, they are structured to encourage larger dealerships to stay within their designated tier.
"Pinnacle is designed to reward those who play a part," de Nysschen said. "Those who do not will not get the rewards. That has always been the approach."
Other notable changes from roughly a year ago include incentives of $28,000 or $30,000 on the purchase of Cadillac Escalade roadside-assistance vehicles (valid on one purchase every three years); a decrease in retail sales performance targets, including the addition of a fourth level; and changes in weighing customer satisfaction indexes.