Will Auto Industry Downturn Kill the Auto Show?

Posted: Nov. 18, 2008 10:11 a.m.

For decades, automakers have used huge public events to unveil the next generation of automobiles, to test public reaction to sometimes wild "concept cars" that point toward possible future designs, to build hype and burnish their reputations with car enthusiasts. Major shows like those in Detroit, Los Angeles, New York, Chicago, Paris, Geneva and Tokyo cost tens of millions of dollars each and take all year to prepare.

They're on life support.

The Wall Street Journal reports, "Detroit's foreign competitors are busy" preparing for "the Los Angeles Auto Show, a showcase of growing importance for green technologies, with a slate of environmentally friendly vehicles."  But the Big Three, traditionally the largest vendors at the show, are almost absent this year.  "General Motors Corp. and Chrysler LLC are virtual no-shows -- not sending any senior executives or holding any press conferences. Among the U.S. auto makers, only Ford Motor Co. has staked out a significant presence at the annual event."

Ford still plans to use the event to build excitement over a key new car.  The AP reports, "Ford Motor Co. tries to revive its classic Mustang muscle car with a makeover for the 2010 model year that debuts at this week's Los Angeles Auto Show."  Ford will also bring "new versions of the Ford Fusion, Mercury Milan and Lincoln MKZ, including Fusion and Milan models with hybrid gas-electric powertrains."

Few other automakers will make an effort at the show.  Beyond GM and Chrysler's cutbacks, Kicking Tires reports, "Volkswagen is also canceling its news conference and will delay the debut of a roadster concept until Detroit" rather than spending money on the Los Angeles show.  Overall, "L.A. will have nearly 20% fewer exhibitors than it did last year."

The Detroit show is seeing withdrawals as well.  Automobile.com reports "Ferrari, Land Rover and Rolls-Royce are opting out of the show for 2009."

Kicking Tires notes that "Suzuki will not have a presence in Detroit at all. Last year, Porsche pulled out of Detroit with no plans to return."  The Chicago auto show "will shrink in size by 15,000 square feet" for next year and GM and Ford have notified organizers of the New York show that they will need less space this year.

The decisions are drastic for an industry that depends on the shows for publicity.  The Detroit News notes that "ore than 1 million visitors will walk through the [Los Angeles] show" next week.  "Media coverage will also be intense, as show organizers expect close to 10,000 people to preview the vehicles Wednesday and Thursday. More than 4,000 journalists have registered to attend."

But Auto123 reports, automakers are pulling out because the shows cost too much for them now.  "All have stated that the cost of transportation is one of the main factors behind the decision, as shipping sets them back a minimum of $10,000 per car."

While the industry cuts expenses wherever it can, automakers are trying to sell cars as fast as possible with deep discounts.  Research the best car deals for November with U.S. News' car rankings and reviews.

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