General Motors is looking to be more involved in the buying process for its new GMC Hummer EV pickup truck and SUV models, encouraging no haggle pricing and limiting the amount of inventory dealerships have access to.
Automotive News recently obtained a copy of the “electric models participation agreement” that GMC is making dealerships sign in order to be entitled to sell the GMC Hummer EV and its other future Ultium-based battery-electric models. Under this agreement, GMC customers must place a reservation for the Hummer EV online and dealers will only receive inventory based on those customer reservations, rather than bulk inventory.
GMC is also encouraging no-haggle pricing for the Hummer EV. While set prices are not part of the participation agreement, it does indicate that customers agree to the suggested retail price when ordering online and can then negotiate the final price with the dealership afterward. The base price for the 2022 GMC Hummer EV Final Edition that will enter production next year is $112,995.
A GMC spokesperson told AN the company is still ironing out the kinks with regard to the unilateral pricing model, so the strategy may still be subject to change.
“We’re still working through the details,” GMC spokeswoman Michelle Malcho told the publication. “We have no comment at this time.”
GMC boss Duncan Aldred said the goal with the set pricing structure is to discourage dealers from price-gouging customers for the Hummer EV, which is expected to be in high demand, and remove some of the confusion from the vehicle process.
“There will be no incentives. There will be no trickery,” Aldred said in October, as quoted by AN. “We are trying to construct a dealer margin in such a fashion that it really is a no-haggle price.”
Additionally, the agreement reserves GMC’s right to limit a dealership’s communication with Hummer EV customers and mandates they must communicate with them manually and not through automated messaging, e-mail or voicemail.
Some dealers aren’t happy with this new model – especially after GM asked them to invest $200,000 or more in facility upgrades to sell and service advanced EVs like the GMC Hummer EV. GM makes no guarantee that dealerships who agree to make these required investments will receive Hummer EV allocation early on
GM, for its part, hopes that strong profit margins and demand for vehicles like the GMC Hummer EV will keep dealers happy as it shifts to this new sales method for EVs. It also hopes that by taking some of the “waste” of the vehicle buying process, it can improve the experience for customers, as well.
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Comments
This move by GM will bite them harder than the Saturn “No – Hassle” BS. Now GM is going to reduce inventories to dealers to control prices? WTH? Call it Price Fixing anyway you want ~ it is still Price Fixing ! At $112K PLUS & Dealer Price Gouging, GM is already shooting itself; again! Basically these are a battery operated Yukon. I’ll keep our gas Yukon & buy another gas Yukon when this 1 dies. If GM wants to be a strong player in the EV game how about making them like candy bars and while lowering the price to affordable! EV’s are supposed to to be “green” & affordable!
Any thing the federal government is pushing will never be affordable. I bet there will be tax breaks for people buying EV’s that cost over 100k.
i’m ok with EV’s however believing they are going to take over ICE vehicles in the next 20-50 years is a pipe dream.
Hummer may be somwhat green but is a ridiculous product with energy eating features no ordinary driver needs.
This truck will only be purchased to make a statement like Benz E Class. I’m sure it will do well as there are many attention grabbing show offs out there.
I just want a modern day EV version of 1990s VW Jetta or even 80s Pontiac Grand Am. Both were great commuter cars, energy efficient and relaxing to drive.
Not to mention the Grand Am being fun to drive.
Did you even read the article? The whole point of the no-haggle pricing was to AVOID price-gouging. Basically, GM is guaranteeing that you will not pay more than the price stated on the order. I don’t think there will be a dealer willing to sell it for less, but this will hopefully avoid them trying to tack on stupid charges to increase profit.
so what does this mean : “it does indicate that customers agree to the suggested retail price when ordering online and can then negotiate the final price with the dealership afterward.”
Unless they are talking about selling you floormats, it sounds like they are leaving the door open to gouging by the dealerships.
outside of the Vehicle price you also have price for paperwork and other dealership fees that can be negotiated.
That’s why they are saying “no haggle” pricing. What they are meaning is that the dealer may still sell for less. It is unlikely that they will though since there will be very low availability. Yes, you may get dinged for high admin fees or other mandatory charges that the dealer puts on, but a dealer with a good reputation is not going to alter they way they handle any transaction. Any dealer that tries to load up the mandatory charges on these is a dealer that maybe you don’t want to deal with. You don’t HAVE to pay it. Go elsewhere. Eventually, everyone that can afford one will be able to buy one. It just may take a few years.
how is this any different? so no haggling on the msrp price but perhaps plenty of haggling on add-on fees that jack up the final price.
don’t like it, go somewhere else … just like it always has been.
i don’t see what the problem is with price gouging for this non-essential product. isn’t it a free market? if someone wants to pay tens of thousands over msrp, go ahead.
Automobile Manufacturers cannot, by law, dictate what price the franchised Dealer can or cannot sell the vehicle for.
Price negotiation is the American way of life.
But, with the Factory’s suggestion that the List Price not be exceeded, most smart dealers will get the message.
Look at the Computer market right now, Nvidia and AMD just released new graphics cards and now they outside a slow production ramp-up are in a supply shortage because many of the available cards are being bought in mass by Scalpers to be resold at extremely High prices. No one likes this. This is reflecting bad on retail and the makers for not handling this better to get the products in the hands of those who actually want it and not those who are only seeking inflated profit.
You are right on. Most cars are 30 grand or more, and people may be used to it. But they are not affordable.
No biggy, they’ll only sell 50 a year .
Initial runs will be a few thousand vehicles and demand globally will be more than supply. This is the part GM leaves out here hence the control of gouging.
I see GM is working the Hummer as the test pattern for future sales and I expect we will see new things a changes as they learn what works and what fails.
I still see many still don’t understand that while 40% of the models offered by GM may be electric they will still be selling nearly all the ICE vehicles they are offering today. GM is going to let the customers migrate over as models that fit their price, needs and interest come to market.
If you don’t want electric GM has plans till 2050 for various ICE vehicles for you.
I expect that like most electronics as the development cost are redeemed GM will be able to offer EV models for less than ICE models as their cost continue to increase. When it comes to continued development ICE is only going to cost more to meet regulations.
Too many confuse the Tesla pattern for high prices as they need the money for development of new product and plants. GM has ICE paying the bills and more plants than they need. They also hold scale that can reduce cost much sooner. VW will leverage much the same too.
Many on the web too often let personal biases and lack of looking into this deeper to let them miss the big picture.
I am a ICE fan but I can look beyond my personal choices to get what they are doing and given what is going on they should do well if the get the vehicles right and selling them right.
In fact success with electric could help ice models survive longer as there will still be needs for them in different cases. If pricing works out EV could support the ICE at some point.
…ooh no, now you’ve done it C8.R, you’ve opened the door for lifelong’er! or did I?😂
What this all boils down to is that GM is setting new rules in response to the dealers past refusal to promote the sale of GM’s previous EV offerings. If the dealers want to be included in the future of the Ultium platform they will have to agree to these terms.
Good show GM!
I believe lifer is a bit restricted so we are free to exchange ideas.
I agree but they are also addressing other past sins too.
Watch GM will limit production to prevent vehicles from sitting on the lots. They will want to keep demand up as if any of these vehicle linger long the media will hit them with it and even if sales are good it will appear bad.
Restricting sales to specific dealers for sure will help as you said. Also it will locate the vehicle allocations to the strongest markets first.
I also expect a time will come that GM will tell the hold out dealers they will have to step up or sell out. Not sure how that will be done yet as laws and money will all need to be considered. They could at some point starve these dealers out as ICE models decline in numbers.
Lot to go on yet. GM has much more to revile.
And just because our friend is not here will toss in Good Service will be important. In this case his some of his rant would fit.
GM needs A compact hummer/jeep(whatever) type 4 seater off road vehicle that is in the $30,000 range.I was hoping the trailblazer would be it but nope.
GM was at its peak when the divisions had the most autonomy.
A couple of elephants in the room. GM is scrambling like crazy to produce an autonomous fleet platform that dealers and Joe Sixpack will never own. And in the mean time a reliable and convenient charging network does not exist outside the Tesla world. Unless you don’t plan on driving your new shiny Hummer anywhere except around your home/business charging outlet you would be crazy to buy one. All dressed up and nowhere to go. Don’t believe me? Do your homework. Read the non Tesla charger reviews and look at the map. Watch Tony Seba’s YouTube video. Building electric vehicles is relatively easy compared to dealing with the other issues.
opens plugshare app…. sees thousands of open and available charging stations….
What a dumb move. If GM really wants to have an “all-electric future”, there should be at least one Hummer on the showroom floor at all times. This will draw customers in as a halo vehicle and may pump up sales of existing GMC vehicles. While the Hummer is out of the price range for most Americans, it is not on the same level as an exotic vehicle like Ferrari.
It’s still possible the bigger dealerships will do just as you say and make sure they have one there to draw in customers. But let the dealers decide if they want to do that.
According to the article, the only way a dealer disallowed to order a Hummer is if there is a customer reservation.
Hey good point. Well, I guess they know what they’re doing.
Yeah, right.
I have no faith. Dealerships will screw us once again and try and charge over cost Salt Lake Chevy is a piece of crap company. They screwed me really bad on a Corvette. Why couldn’t their dealership have been one of the ones to burn down during riots….. They would at least deserve it.
Free Kyle Rittenhouse!!!!!