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Car brands count cost of cancelled show

Bang for bucks: Brands such as Ford and Mercedes-Benz are reconsidering budget spends.

Aborted 2013 Aussie motor show to cost millions as organisers mull future direction

General News logo26 Mar 2013

CAR companies are counting the cost of the shock announcement this week to cancel the 2013 Australian International Motor Show, with tens of millions of dollars expected to be lost and world debuts postponed or lost to rival shows overseas.

This year’s AIMS was scheduled to open in Melbourne on June 28, some eight months after the poorly attended Sydney leg of the biggest event on the Australian automotive calendar, which has alternated between the two cities since 2010 after a number of disgruntled car companies successfully lobbied for a single annual international-standard auto show.

Jointly run by the Federal Chamber of Automotive Industries (FCAI) and the Victorian Automobile Chamber of Commerce (VACC), AIMS organisers have now left the industry reeling with the cancellation of the traditionally strong Melbourne show this year, with event director Russ Tyrie revealing it had failed to get the backing of several as yet unnamed car-makers.

GoAuto has since learnt that BMW, Nissan and its luxury brand Infiniti were no-shows, while Hyundai and Volkswagen said they were still to commit before the event was axed.

Toyota, Mazda, Ford, Holden and Mercedes-Benz were all onboard.

“We have made the decision to not proceed with this year’s show based on a consensus view of the automotive industry to focus limited marketing budgets in 2013 on firm-specific activities rather than an industry-based motor show,” Mr Tyrie said.

He was unable to say when or where the next show will be held, with the staging of the 2014 show previously scheduled to relocate outside the Sydney CBD to Homebush as the New South Wales government rebuilds the Darling Harbour precinct.

“That is something that is entirely up to the joint-venture committee to decide,” Mr Tyrie said. “What we have now is a blank canvas.”

As organisers now weigh up the merits of a broader Asia-Pacific region show or other formats such as along the lines of the Goodwood Festival of Speed in the UK, some of Australia’s top car companies are now working on alternative arrangements for crucial new-model unveilings and high-profile marketing activities.

Among them is Ford Australia, which GoAuto understands was preparing to use Melbourne for the world debut of its 2014 Falcon.

The Blue Oval brand used last year’s Sydney-based show to tease an image of the forthcoming new Falcon, with chief designer Chris Svensson revealing to GoAuto that the heavily restyled large car would make its first appearance during 2013.

Ford Australia brand communications manager Neil McDonald said the company was “obviously disappointed” at the show’s cancellation by organisers reacting to what they say was a mutual decision with car-makers that the funds were better spent elsewhere.

“We’re now working on alternative plans for something, but it is still too early to say what that is,” Mr McDonald said.

He said Ford Australia had received good feedback from show-goers attending an interactive display in Sydney last year that highlighted technology that goes into Ford’s cars, making it a worthwhile event for the company.

Holden, meanwhile, said it was in the “very early” stages of planning for the Melbourne show, and that the cancellation would have “minimal effect” on the company’s operations, despite it being a massive opportunity for around 200,000 visitors (based on Melbourne’s 2011 attendance figure) to get a close look at its all-important new VF Commodore.

GM Holden director of external communications Craig Cheetham said the company was planning to attend the show but it was not considered “mission-critical”.

“Obviously our focus would have been on the VF Commodore, the Trax (mini-SUV) and the Malibu (mid-size sedan) as new models,” he said.

“We were planning to attend, and it was certainly something that featured in our marketing budgets this year ... (but) it’s not something that we would say was mission-critical to see the Commodore or any other cars that we have this year.”

Mr Cheetham said the money put aside for the show would pour into “clever and creative” marketing opportunities for the brand.

Holden’s easy transition is in stark contrast to Mercedes-Benz, which now has three purpose-built cars – and “something else special” – with no means to show them.

Senior manager of corporate communications David McCarthy said the German luxury brand had stuck to its support of the single-show format after arguing several years ago that the expense of separate shows in Melbourne and Sydney each year was too much.

The car-maker is believed to have budgets running into the several hundred thousands of dollars to stage its displays.

“We withdrew from the Melbourne and Sydney shows until there was one show, because we believed one show a year was what was needed,” Mr McCarthy said.

“We’ve supported that, and in fact we’d put our hand up for more space at Melbourne, which would have given us another eight cars to display.

“We also had something special to show – I’m not going to tell you what it is – so our commitment to the one show is evident.

“Are we disappointed the show is not taking place? The answer is yes – surely a market of one million vehicles can support a motor show.”

Mr McCarthy said he was puzzled as to why the decision had been made to cancel the show.

“We’re (also) disappointed because we want to showcase our brand, and if our competitors aren’t there, all the better.

“But there’s a factor in our decision … we believe that everyone has an expectation of being able to see all the cars together in the one place.

“From a retail perspective, the show has been good to us – we’ve sold a lot of cars.”

It is a different story at BMW, which last attended the show in 2011 and only had one vehicle on display – the Vision EfficientDynamics supercar concept.

The German luxury brand’s general manager of corporate communications, Lenore Fletcher, said BMW would consider returning to a reformatted car show, but potentially only if it changes.

“We were not going to attend the motor show this year, and that was a decision made on the back of the different (marketing) programs that we have available to us,” Ms Fletcher said.

“There have been a lot of tactics (at motor shows) that have been tried by car companies over the years, but I think at the end of the day they haven’t made a huge amount of difference to the amount of traffic or inquiries (about new cars) that we’ve had.

“We’re looking for new and innovative ways to market our products, as many car manufacturers are, but we just believe there are a lot of platforms available and we’re looking at those.”

Nissan Australia and its luxury brand Infiniti had both made it clear from early on that they would not attend the Melbourne show, while Volkswagen and Hyundai said they had not committed to the event before the axing.

GoAuto understands that market leader Toyota was fully committed, and leading importer Mazda has confirmed it was also onboard.

Toyota Australia public relations manager Mike Breen said only that “we will continue to work with the FCAI on potential new activities and the future direction of Australian motor shows any further questions should be directed to AIMS”.

Meanwhile, Mazda Australia public relations manager Steve Maciver said the company had planned something “very special” for the event.

“I can’t tell you what it is, but we’ve had a fairly big show the last few years ... and we did have something very special in the pipelines,” he said.

“We can’t do that at the show, but we can try and engage with our customers at another time.”

Nissan Australia’s national media manager Peter Fadeyev said the high-profile Japanese brand and its fledgling Infiniti luxury marque had not factored in taking part in the event.

“Our intention was to not turn up,” Mr Fadeyev said. “We’d made alternative plans.”

Volkswagen Group Australia general manager of communications Karl Gehling said many car brands used the show as a unique opportunity to present their entire product line-up.

“It’s never easy to measure the (actual) value of it (attending the show),” Mr Gehling said. “I think the formula for motor shows has been very successful but it is starting to struggle in the age of readily available information and details on new cars.

“The surprise factor of the motor show is certainly not as great as it used to be.

“We’ve got some money to invest in something else now.”

Hyundai Motor Co Australia also confirmed it had not committed to attending June’s event.

“We hadn’t actually backed out either, we were just weighing it up,” public relations general manager Bill Thomas told GoAuto.

“It is something we’ve supported for a long time, and definitely something that has done us some good in the past.

“But just looking at the falling audiences and the way that things are going we just decided it wasn’t commercially viable any more.”

FCAI chief executive Tony Weber told GoAuto said the show’s cancellation was a consensus of the industry to focus limited marketing dollars on brand-specific activities rather than an industry-wide motor show.

He said the internet appeared to be having an effect on the amount of resources car-makers could pour into glitzy show displays“The number of international motor shows is declining – you’ll find that London, Zagreb and Amsterdam aren’t having shows,” he said.

“There are many ways to advertise, and the motor show is one of them, but no doubt there are greater varieties of advertising, so in part it reflects (the influence of the internet).” He said organisers needed to look at the format of the Australian motor shows and “look at all our options”.

Mr Weber said he would not disclose how much the decision to cancel would cost show organisers.

Last year’s motor show in Sydney was largely overlooked by about half the brands on sale in Australia.

Those missing included halo brands such as Ferrari, Lotus and Maserati, along with Audi, Volvo and mainstream brands such as Renault and Jeep.

The Sydney show attracted only 135,000 visitors, which in turn prompted show organisers to mount a review to help pinpoint reasons for the disappointing turnout.

At the height of the global credit crunch in 2009, 19 brands opted to pull out of the Melbourne motor show as marketing budgets tightened.

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