Monday, May 19, 2014

Cadillac ELR Dealers Getting $5K from GM to Keep Demo Cars, Nearly Two-Year Supply Exists

2014 Cadillac ELR

The cocky Cadillac ELR commercial that had us cringing during the Winter Olympics isn't delivering the expensive "stuff" so glibly exalted in the spot. Namely, that'd be money from the 725-day supply of unsold ELRs on dealer lots, according to the latest analysis from Automotive News.

"You work hard, you create your own luck, and you gotta believe anything is possible," says Desperate Housewives actor Neal McDonough in the ad. But while it sure is possible to move those 1700 unsold ELRs, Cadillac will need about two years to finish the job if it can't find more than 60 people a month who want a $76,000 two-door plug-in hybrid. Cadillac, in the AN report, attributes the inventory buildup to a heavy production cycle ahead of a summer and fall slowdown.

Through April, Cadillac sold only 241 ELRs. By comparison, 4975 Escalades catapulted out of showrooms in the same period, and even the SRT Viper has outsold the ELR through April. The premium plug-in market, which began and ended with the Fisker Karma, is only beginning to reemerge as an actual segment. Using gas-electric powertrain configuration and a high price tag as the indicators, the only real competitor to the ELR is the four-door Porsche Panamera S E-Hybrid, which retails for roughly $25,000 more.



Cadillac dealers who sell the ELR—more than half of its 910 U.S. dealers have declined to do so, citing overall costs— and have up to seven unsold units will receive $5000 from GM for maintaining one as a demo vehicle for test-drive purposes. Dealers with more than seven unsold ELRs can have two demo units and get $10K from GM. (The cars each also have to accumulate at least 750 logged test miles to qualify for the payments.) GM will also pay dealers $2000 per car sold in July and $3000 in August. While that doesn't necessarily translate into cash-on-hood discounts, many dealers, in addition to those advertising the available $7500 federal tax credit as a "rebate," have listed new ELRs for thousands less than sticker. Since January, Cadillac has offered the first 1000 ELR adopters a free 240-volt home charging station and up to $3000 in installation costs. Since GM hasn't sold even half that many cars yet, expect those deals to be around for a while.

Cadillac ELR Dealers Getting $5K from GM to Keep Demo Cars, Nearly Two-Year Supply Exists



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