(Photo by Paul Hennessy/SOPA Images/LightRocket via Getty Images)
- The coronavirus pandemic threatens the future of traditional car shows as attendance dwindles and sponsorship weakens.
- Car shows face competition as automotive manufacturers turn to the internet and off-site media previews to debut new vehicles.
- Experts don't expect traditional car shows to disappear completely but suggested that car shows must innovate if they are to stay relevant.
- Visit Business Insider's homepage for more stories.
Last week would have been a big week in Motown, the North American International Auto Show opening its doors to the public for the first time since abandoning its traditional winter timetable in January 2019.
The move aimed to revitalize what long was considered one of the world's most important car shows, typically drawing over 700,000 visitors through its turnstiles while, in its heyday, as many as 70 new cars, trucks, crossovers and concepts would make their debut. The last few years saw sharp declines at NAIAS, however. What was once three hectic days of product debuts shrinking to barely five hours. Sponsors had hoped a new spring timetable, allowing the show to spread to surrounding park space, would give it a kick-start. But the pandemic forced cancellation of the debut event.
The Detroit auto show isn't the only one struggling. Attendance at the Frankfurt Motor Show, once the biggest global events, was so weak last year sponsors called it their last. Now, as the coronavirus scrubs most major public events, the question is whether car shows can survive the pandemic.
"The auto show was certainly on life support already," said Jeff Schuster, lead auto analyst with consultancy LMC Automotive. "With the rolling cancellation of one show after another, the coronavirus may be speeding up their demise."
This year may see only one significant global car show, February's gathering in Chicago. Since the last-minute decision to halt the Geneva Motor Show later that month one event after another has been scrubbed, including big shows in New York and Paris, and smaller gatherings around the world. The Los Angeles Auto Show, still on the books for November, is widely expected to postpone until 2021, say numerous industry planners, though there's been no formal announcement.
The coronavirus has hit everything from baseball games to amusement parks. But it's coming at a particularly tough time for car shows already struggling with weakening public attendance and declining industry support for much of the past decade.
Attendance at the Frankfurt Auto Show peaked at 931,000 in 2015, when there were so many new models debuts organizers scheduled two simultaneous news conferences every 20 minutes for 10 hours. Last fall, public turnout was 40% lower, while manufacturers including Alfa Romeo, Bentley, Ferrari, Infiniti, Jeep, Nissan, Tesla, and a half-dozen other brands skipped out entirely.
High costs are a major factor. Even the smallest stands in New York, Paris or Los Angeles "will come in at $1 million, bare minimum," said Schuster, adding it's "easy" to get to $10 million, especially when a carmaker brings in a big name entertainer, as Mercedes-Benz often does.
Today, however, budgets are getting squeezed, and manufacturers want ways to get more for their dollars, said Mark Wakefield, head of AlixPartners' automotive practice. There also is more competition making classic car shows "just not as useful."
A major reason for Detroit's move to June was the emergence of January's Consumer Electronics Show in Las Vegas as the go-to place for automakers debuting increasingly high-tech products and digital features. This year, more than a dozen staged events at CES.
Automakers are turning to places like the Texas State Fair to reveal new trucks, such as the latest-generation Chevrolet Silverado, and the annual Pebble Beach Concours d'Elegance as a backdrop for new luxury products.
Then there's the internet which, this year has seen dozens of web debuts for products like the Honda Civic Type R, the Nissan Rogue, the Toyota Venza, Ford's F-150, and the Mercedes E-Class.
Even when they do turn up at for traditional events like last November's Los Angeles Auto Show, many automakers have switched to off-site media previews. That not only can save money but give manufacturers more time with journalists who might otherwise have to run from one event to another every 20 minutes, explained a Volkswagen planner who asked not to be identified by name.
There's no question "It's time for auto shows to make an adjustment," said Rod Alberts, executive director of the Detroit Auto Dealers Association, which sponsors the NAIAS. "If shows learn to adapt, I think they'll stay around."
The original plans for the 2020 event called for NAIAS to spread out from the confines of Detroit's TCF Center, setting up exhibits not only on the roof of the convention hall, but in the adjoining riverfront park land, "something we couldn't do in winter," said Alberts.
The DADA also was setting up an off-site event for luxury brands, like Ferrari and Rolls-Royce, that otherwise saw little value in setting up stands at TCF Center. And, rather than stick with the traditional, static displays, automakers were invited to offer potential buyers short rides in some of their news products.
Auto shows are "becoming more focused on how to get people into dealerships," said David Sloan, the president of the Chicago Auto Trade Association, which sponsors that city's event.
Organizers are wont to quote data showing car shows generate sales.
"In 2019, 72% of New York Auto Show attendees said they will buy or lease a new vehicle in the next 12 months, and 36% of them added brands to their consideration lists after visiting the Show," stated a May release by organizers of the 120-year-old event.
But such numbers are being greeted with increasing skepticism, especially as manufacturers experiment with alternatives they feel are proving at least as effective at reaching and motivating potential buyers, said LMC Wakefield.
And the coronavirus pandemic will add impetus to a shift away from car shows, along with other large public gatherings, he said, adding that, "We're expecting to see, post-coronavirus, a step-level change in people's comfort level with doing things online."
Car shows won't go away entirely, Wakefield and other experts believe, but those that can't adapt to changing realities might fail, as did Frankfurt. Those that do survive are likely to be smaller, less lavish, and far more focused as they square off against others competing for the attention of potential car buyers.
Read the original article on Business Insider