Big crowd at 2007 Detroit show
I’ll be heading off to the North American International Auto Show’s annual Charity Preview, in a few hours. The annual event, known to insiders as “Prom Night,” has, in years past, drawn as many as 17,000 folks, despite a ticket price of more than $400. This time, the advance attendance figures suggest the preview will be lucky to draw 10,000.
Okay, maybe that’s understandable, given that most of the tickets are usually purchased by corporations for their top execs and senior employees. Not many folks shell out that cash from their own pocket. But the auto show, itself, is expected to see a sharp decline in general attendance, during its nearly two-week run.
Again, you can blame the economy, the slump in the car market or, if you prefer, the frigid cold snap that’s blanketing Michigan. But the fact is, turnout was slumping for a number of years, even before the auto market started to drop.
2008 La auto show
And with only a few exceptions, that’s happening around the world. Consumers seem to be finding less and less reason to go to the big car shows. Media attention is dipping, as well, even though there’s a big surge in the number of outlets – largely online – covering the automotive world.
Why? There are the short-term problems, as mentioned above. In times like these, people often cut back on their spending, even if it’s the relatively small price of a car show ticket. And there’s even less reason to go if you’re out of work or out of the car market.
Manufacturers, meanwhile, are forced to rethink their own commitment to the car show. A typical, medium-size display, in Detroit, will cost a carmaker $3 million. And some of the truly humongous and creative set-ups, like we used to see from the Big Three, could push to $50 million or more. “We just couldn’t justify it,” said a senior import PR executive, representing one of the half-dozen makers who pulled out of the Motor City bacchanal this year. “We really had nothing to say,” added the executive, requesting anonymity, “and it just doesn’t sell enough cars for us.”
That touches on the two biggest threats to the car show, going forward. There are, of course, auto shows, and then there are auto shows. Most are there simply to let dealers, cars and customers come together. Moving metal is what matters. The lead events – in Detroit, Chicago, NY, LA, Paris, Frankfurt and Tokyo – add public relations to the equation. Bring out the right product, the right executives, and stage the right event and you can more than offset your costs through publicity.
At least, that’s the standard argument, but the crowds are down, and they aren’t buying. And some makers are questioning the real value of the publicity they get, especially if they don’t have the sort of launch product to land them on page 1.
Both reasons were cited, to varying degrees, by the carmakers who abandoned the NAIAS, this year. Now, it appears as many as a dozen makers could walk from the biennial Tokyo Motor Show. Its organizers are giving serious thought to cancelling the 2009 event.
In a new piece, Fortune editor Alex Taylor III adds the Internet into the equation. In “Sayonara Auto Shows” http://money.cnn.com/2009/01/16/autos/sayonara_autoshow.fortune/index.htm?postversion=2009011609 , Taylor says that by releasing pictures and press releases of their new products in advance of shows like Detroit and Tokyo – and by making access to the shows available online, I should add – there’s less need to attend the actual events.
Will auto shows go away entirely? Not likely, though some of the big ones, like Tokyo, could fade into second-tier status, much like what happened, years ago, to shows in Milan and London. A few events might event be cancelled entirely. Manufacturers are looking for alternative ways to spend – less – money, while still reaching the public. And they’re often staging traveling road shows – much like the legendary General Motors Autorama – where they don’t have to vie for attention with their competitors.
Autowriters at 2009 Detroit show
Full disclosure here: last Summer, I volunteered as CEO of the non-profit NextCruise, in which nine major automakers participated. The green-minded event was used to display the latest in hybrids, clean diesels and other environmentally-friendly vehicles. It also permitted the public to actually drive some of these products. Significantly, the Detroit show organizers did something similar, on a smaller scale, in Michigan Hall, the lower level of Cobo Center, the site of the North American International Auto Show.
Perhaps, going forward, makers will look at opportunities to put more “butts in seats,” even if the overall headcount declines.
Auto shows are an endangered species. They’re not likely to die out completely, but they’re almost certain to evolve, and possible decline in size and power.