Departing Buick dealers are the biggest reason for a decline in the number of U.S. dealership franchises overall, in the first half of 2023 vs. the same period a year ago, according to a recent report from Urban Science.
“Buick is the main franchise that went down,” says Mitch Phillips, Urban Science director, global data and analytics.
As of July 1, 2023, Urban Science reports there were 30,844 U.S. new-vehicle franchises, down by 710, or 2.3%, vs. a year ago.
The number of dealership rooftops — which often contain multiple franchises for different brands — was flat, at 18,280 this year, vs. 18,257 , in 2022, an increase of just 23.
In September 2022, Buick announced it would offer buyouts to any U.S. dealers who don’t want to make the required investment to switch to an all-electric lineup by 2030. As of Jan. 1, 2023, Buick had just under 2,000 U.S. franchises.
To avoid influencing dealers ' decisions, Buick spokesperson Stefan Cross tells Wards Buick is not disclosing how many dealers accept a buyout until after the offer expires.
Reports show that as of Jan. 1, 2022, about one-third of U.S. Cadillac dealers took a similar buyout.
Even with the Buick buyouts this year, for the industry as a whole, the number of franchises and the number of dealership rooftops have been remarkably stable since 2010, according to Urban Science.
That’s in contrast to a dealer watershed starting in 2009 when General Motors and the former Chrysler Group went through bankruptcy restructuring..
“Prior to 2010, it was a different realm,” Philips tells Wards. “After 2010, it’s been pretty flat.” According to Urban Science, in 2009, the number of dealerships fell by 1,605, down 8%, compared to 881 dealerships in 2008.