As many as 145 jobs could be lost when BBDO Detroit closes due to contract problems with post-bankruptcy Chrysler.
Yet another Detroit advertising agency has taken a bullet as the Big Three makers rethink and realign their marketing strategies.
BBDO Detroit, one of the largest agency serving the domestic makers, has been unable to reach what will, at best, be a scaled-back contract with Chrysler. At this point, officials are anticipating that the long-term relationship will come to an end when the current contract expires, on January 26, 2010. As a result, the ad firm is advising Detroit-based employees that they’ll be out of a job by the beginning of the year.
In all, at least 145 employees will be impacted. It’s not clear how many – if any at all – of those workers will be given the opportunity to transfer to another BBDO office elsewhere in the U.S.
The agency delivered a terse statement confirming the news:
“BBDO Detroit announced today that it is making staff reductions in response to reduced levels of activity by its key client, Chrysler LLC. In all, 145 positions have been eliminated, with reductions being made across all functions driven by the reduced level of activity and changes in the nature of planned activities.”
Industry sources say BBDO has been pushing to negotiate a revised contract though, so far, it hasn’t been able to reach an agreement. Even if that happens before the expiration date, it’s unlikely the office would remain open, and even if it did, there would still be a sharp reduction in the workload and employment levels.
An assortment of Detroit auto brands have or will break long-time bonds with their agencies in the hope of reviving sales and market share. That includes Cadillac, which last month revealed it would abandon Modernista and go agency shopping. Chevrolet, meanwhile, has told giant Campbell-Ewald that it will sharply scale back and perhaps even break a maker/agency relationship that ran for much of the last century.
Bob Lutz, now GM’s marketing czar, last month said the days of “formulaic and cautious” marketing efforts have come to an end. That is clearly echoing across the Motor City. Industry observers expected change at Chrysler once the company emerged from bankruptcy, earlier this year, and fell under the control of Italy’s Fiat.
The big question is whether Ford will seek to start moving some or all of its business away from JWT, an agency that many have come to view as just a division of the carmaker.