GM's luxury division hopes to convert some dealerships into virtual showrooms. But as Fred Katayama reports, some dealers worry they'll turn into service centers.
When you visit a Cadillac dealer in the future, you may not see cars on the lot. General Motors' luxury division is planning to convert some dealerships with weak sales into virtual showrooms. Cadillac will begin looking for voluntary commitments from some dealers this month. Its U.S. network of 925 stores is triple that of its German rivals like BMW but sells about half the volume. Analyst Glenn Chin at Buckingham Research said, "Cadillac has many more stores than its European competitors. This would be a way to leverage that scale rather than build out that scale. So it makes sense." The plan currently under research: have visitors use virtual reality headsets to see the vehicles, then take their order. That saves costs by stripping stores of inventory. Impatient American consumers are used to buying off the lots after a test drive, but many Europeans buy cars built-to-order. But Automotive News reports that some U.S. dealers worry they'll wind up becoming Cadillac service centers that might occasionally sell a car. A Cadillac spokesman said there's no timetable set for converting the showrooms.