Auto Expo 2020: Digital tilts the wheel as marquee brands plan to skip

Topics Auto Expo | Daimler | Ford

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With a little over a month to go for what used to be one of the biggest theatrical productions for the auto industry, the Auto Expo 2020, it now seems likely that marquee brands such as Hero, TVS, Honda, Bajaj, Harley Davidson, Royal Enfield, Nissan, BMW, Ford, Daimler, PSA Citroen will sit this one out. Just as many did in 2018. 

However, China’s SAIC-owned Morris Garage (MG), its SUV manufacturers Great Wall Motors and Changan Automobiles and some electric two-wheeler makers have all signed on for the show. A spokesperson for M G Motors said they were planning a big bang presentation with 20 products at the Expo. Great Wall Motors, one of China’s largest SUV and pickup manufacturers, is expected to kickstart its Indian journey with the show where it plans to showcase its brand Haval. Maruti Suzuki, Hyundai, Tata Motors, M&M, Renault, Kia, Mercedes Benz are among the others that have committed their presence at the Expo. 

Most two-wheeler brands are absent this year too, though. Besides the big four, Hero, Bajaj, Honda and TVS, brands such as Royal Enfield, Harley-Davidson, will also not be at Auto Expo. Auto experts and analysts point out, the show that was once the domain of Japanese and European brands, is now the plyground for a new pack of brands from China. Is this the new order for the new year?

For most of the brands keeping away, the big factor appears to be cost of participation. So much so that even European auto major PSA Citroen, which is expected to launch its first car in India next year, is not participating. Costs are disproportionate to the exposure companies said. Given the gloom in the sector, but more importantly because of the rising attraction of digital marketing channels. SIAM did not respond to an email seeking comments for the story.

A spokesperson for Hero MotoCorp said, “As the market leader, Hero MotoCorp has always been a flagship participant. However, participation in the Expo would require months of preparation and allocation of massive resources, both in terms of financial spends and manpower. In keeping with our prioritised objectives, we have decided to skip the upcoming Expo.” 

K N Radhakrishnan, president, CEO & Additional Whole-Time Director, TVS Motor Company said that it was a combination of things (economic gloom, lack of new models, cost and so on) keeping people away. A senior marketing official said that companies now track Return on Investment (RoI) on every rupee spent on advertising. 

On digital, programmatic advertising along with virtual showrooms that allow one a complete feel of the automobile before they step into a showroom are among the major draws for auto brands today. A study by Google with Kantar TNS earlier this year found that 90 per cent of car buyers research online before setting foot into a dealership and once they’re at the dealership, 65 per cent of car buyers continue to do research on their smartphones. The need to go to an annual jamboree is shrinking for consumers, as are the reasons for auto makers to spend big bucks on large events, said marketing professionals at several companies.

A senior official says if a brand wants to put up a decent show, it will need around 1,800 square feet sized stalls (major brands book spaces that are at least double of four times this size). For this the rents alone make for around Rs 2-2.5 crore. Add to this the cost of logistics, taxes and affiliate services, the budget balloons to at least Rs 15-20 crore, he adds. Returns are not commensurate with costs involved said another auto maker.

Companies are also shying off because there is not much to showcase. Besides the BS-IV to BS-VI transition, electric and other new technology developments are the major focus now, said an analyst. Even electric vehicles are the toast of the previous season. 

However the CEO of an auto company said that participating in an expo is part of a long term India commitment and it cannot be given up owing to temporary slowdown. This is a sentiment echoed by many who have already logged in their participation. Manohar Bhat, vice president and head, Sales & Marketing, Kia Motors India said, “Our idea is to play to our strengths, which is to showcase our premium quality products. Auto Expo warrants a lot of eyeballs and creates inquisitiveness amongst the audiences. It is also an essential part of our customer study and buying behaviour.”




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