Automotive News - September 7, 2020 - 27

SEPTEMBER 7, 2020 * 27

CONTRACT

GM, dealers have to
sort out 'a lot of details'
continued from Page 1

alliance with Honda Motor Co. designed in part
to help fund and streamline its EV portfolio.
GM sent the agreement to dealers to help
plan its EV rollout, GM North America President Steve Carlisle said.
"It's a necessary step that we need to take to
achieve our vision of an electrified future," he
told Automotive News. "We can communicate
what we think is required to create the environment, and we've got to work with the dealers,
the dealer councils and the associations to arrive at a conclusion. But we're not at that point
yet."
GM did not disclose the number of dealers
who have signed the agreement. The process is
ongoing, Carlisle said last week.
Hall said the dealers who have balked at the
contract aren't against selling EVs, but they
want more information on how GM will help
them before dedicating hundreds of thousands of dollars to EV sales and service.
"You've got some rural dealers where the demand is not going to be there for the time be-

SHOWS

Tough choices
for companies

continued from Page 8

the LA show into May puts automakers in an uncomfortable position.
"We know that sales aren't going to
be back to where they were before
the pandemic, and automakers were
already shying away from auto
shows," Krebs said.
"Automakers are going to have to
be very careful about what they decide to do. Resources are still going
to be tight; we're still bleeding jobs
in the industry."
New York's earlier date might look
attractive at first - a new vehicle
debuted in April would be available
for consumers to look at in May or
June in the other cities. But that also
carries added risks: Given the vagaries of the pandemic and the development time needed for a potential
vaccine, those added weeks could
be the difference between having a
2021 show and not having one.
Then there's the question of splash:
If automakers all jam into New York
in hopes of hitting consumers at all
three shows, it might make sense to
move a reveal to one of the other
shows to grab more of the spotlight.
This is the basic logic that's kept the
February Chicago show relevant, as

BEIJING

Many carmakers
to skip auto show

continued from Page 8

Among the companies to pass on
attending are China's two largest
players, Volkswagen Group and
General Motors. Toyota Motor Corp.,
Honda Motor Co., Nissan Motor Co.,
Ford Motor Co. and PSA Group also
do not plan to attend.
Missing, too, will be Germany's
three big luxury brands - Audi,
BMW and Mercedes-Benz - even
though China is by far the largest
market for each of them.
Only a few global automakers, including Hyundai Motor Co. and

ing," Hall said. "You can't really expect them to
want to spend with great enthusiasm a lot of
money on something that hasn't hit our marketplace yet."
Carlisle said that as GM continues to reveal
its upcoming EVs, awareness and demand will
increase. Today, GM has just one U.S. EV: the
Chevy Bolt. The automaker plans to launch a
crossover version of the Bolt next year and has
unveiled the Cadillac Lyriq, a midsize battery-electric crossover, though production is
still two years away. GM also plans to reveal the
electric GMC Hummer pickup this year and
start building it in late 2021.
"As we roll out products and that adoption
curve kicks in, the volume will grow," said Carlisle. "We certainly expect that there will be a
return on that. That's our mutual future."

ZEV states
The presidents of the state dealer associations in Colorado and New Jersey said they believe the vast majority of their members signed
the contract. Both states are part of the California ZEV program, which requires automakers
to offer a specific number of battery-electric,
hydrogen fuel cell and plug-in hybrid vehicles
for sale. Ten states are part of the program, and
four others have announced plans to join.
"When they have to start spending money,

Quick succession
3 of the nation's biggest
auto shows are planned for
consecutive months next
year
New York International Auto
Show: Media preview, March
31-April 1; public days, April
2-11
Los Angeles Auto Show:
Media preview, May 19-20;
public days, May 21-31
North American
International Auto Show:
Media preview, June 15-16;
public days, June 19-26

at least a smaller player in the reveal
game over the last decade or more,
even though its consumer attendance and facilities are top-notch.
Toyota is the largest automaker that
still firmly believes in the value of auto shows, regularly dispatching its top
executives to the Detroit, Chicago,
New York and Los Angeles venues
and using each to highlight at least
some new derivative or trim model, if
not a new vehicle or concept.
Jack Hollis - who until last month
ran Toyota Division for Toyota Motor
North America and now is senior
vice president, automotive operations group - said the automaker
has "become accustomed to develMazda Motor Corp., said last week
that they are still finalizing plans and
remain undecided.
As September started, only one international brand intended to arrange
for its senior executives to fly to China
for the show: Polestar, the electrified
performance-vehicle brand jointly
owned by Volvo Car Corp. and its Chinese parent Zhejiang Geely Holding
Group. Polestar CEO Thomas Ingenlath will participate in person, according to the company.
But parent company Volvo confirmed to Automotive News that it
will not send anyone from outside
China to the show.

Strict quarantine
One reason companies say they
are choosing not to travel into Bei-

that's when things might get a little dicey," said
Jim Appleton, president of New Jersey's dealer
association. "But for now, I think the dealers
are enthusiastically looking forward to the new
product."
If there is significant EV inventory and market demand when it's time for dealers to update their stores, they'll make the investment,
he said.
GM is asking dealers to spend between
$120,000 and $200,000 to ready their facilities
for EV sales and service, Appleton said. But that
bill could be substantially reduced if dealers
can meet the requirements through their own
vendors. For example, rather than installing a
new lift for $30,000, dealers could rent one for a
few hundred dollars per month as needed.
If automakers give New Jersey and other
states in the ZEV program priority on EV shipments and support EV sales with additional incentives and marketing programs, "the dollars
they are asking dealers to expend is completely
reasonable in light of the potential return on
the investment," Appleton said.

Separate agreement
Some dealers are reluctant to sign a contract
separate from their sales and service agreement, said Ted Smith, president of the Florida
Automobile Dealers Association.

oping multiple contingency plans
for all of our activations, and auto
shows are no different."
Hollis said Toyota times its reveals
based on many factors, including vehicle production and on-sale dates.
"The prospect of three successive
months of auto shows is an exciting
new development we are factoring
into our overall strategy," he said.
Whether the jammed calendar stay
that way as next year's auto show
season draws closer remains to be
seen. Leaders of Detroit's auto show
- which was moved from January to
June this year before COVID-19 struck
- released a statement last week indicating the event will go on as planned,
despite the L.A. show's decision.
Rod Alberts, the Detroit show's executive director, called the L.A. move
"not good for anyone" and said it puts
auto companies "in a tough situation,
both logistically and financially, with
so many major shows close together
in the spring and early summer."
Alberts said the Detroit show's
plans "have been clear since the moment we canceled our June 2020
event earlier this year. We've stayed
in line with our plans established almost two years ago. We've continued
to be in close contact with all the auto companies since we announced
the cancellation of our 2020 show,
and we are well into the planning
stage to host next year's event from
June 11 to June 26."
jing is China's strict quarantine requirements.
"City of Beijing is currently requiring two-week quarantine for people
coming from overseas," Toyota said
in an email reply to a query from
Automotive News.
Toyota nonetheless will hold court at
the show with a media press conference. But the speaker will be an executive from Toyota's Beijing-based China
subsidiary, Toyota Motor China Investment, not someone from its headquarters in Japan, the automaker added.
To prevent new virus imports, all
Chinese cities have imposed the
same requirement as Beijing for
overseas travelers - a 14-day quarantine in a location designated by
local governments.
Aside from the quarantine rule, there

"It's the actual requirement for a separate
agreement that has caused some dealers to
stumble," said Smith. "Dealers wonder, 'What
am I signing and how is it different from anything else?' "
Members of the North Carolina Automobile
Dealers Association also were skeptical of a
separate EV agreement, President Bob Glaser
said.
"They do not believe that all of a sudden
when the factory comes out with a new car or a
new line of cars that they should have to sign a
separate agreement," he said. "If I'm a Buick
dealer, I should be able to sell all Buicks."
In North Carolina, fewer than 1 percent of
new vehicles sold last year were electric. But
when demand increases, "you'll see dealers
lining up right away on this," Glaser said. "The
dealers are hoping that the OEMs will move in
tandem with consumer demand."
GM has just started to show off the 20 EVs it
plans to launch globally by 2023, and excitement is building as dealers glimpse the vehicles heading their way, Carlisle said. Of about
880 Cadillac dealers, 800 tuned into an early
virtual reveal of the Lyriq, and many of them
hosted watch parties, he said.
"There's a lot to look forward to here," Carlisle
said. "The reality is we have a fair amount of
work to do to sort through a lot of details." a

NFL

'Critical part of the
mix,' Hyundai says
continued from Page 4

ahead with its NFL game plan.
Hyundai, once a league sponsor
that carried the designation of official car and SUV of the NFL, is entering its third season as the presenting
sponsor of the pregame show for
NBC's "Sunday Night Football."
The Sunday production, Hyundai
said, has been the most watched TV
broadcast for nine consecutive seasons, attracting 20 million viewers a
week.
The Korean automaker will use
that time to spotlight its three-row
Palisade. One piece of Hyundai's
Sunday night plan will be "Tailback
Tailgate," a content series that will air
before three games. Hyundai said
former NFL running backs will tailgate from the back of the Palisade
Calligraphy Edition, "where they will
discuss that week's game over iconic
cuisine from the home city that
week."
The Sunday sponsorship includes
branding elements such as logo animations, in-studio signage and logo
placements on the broadcast's
countdown clock.
The brand also is continuing its local automotive sponsorship of the
also are increased difficulties in obtaining visa approval to enter China,
and a more limited number of available international flights since the pandemic, according to global automakers
contacted by Automotive News.

Fewer global debuts
Beyond the travel challenges, automakers have yet to disclose what
products they will display at the
show. But initial information indicates that, because of increased efforts to cut costs around the industry
and greater difficulty in shipping vehicles into China because of the pandemic, there will be fewer global
model premieres than at previous
auto shows in Beijing and Shanghai.
Those shows have emerged as
critical showcases for new models

Chicago Bears, Philadelphia Eagles,
Arizona Cardinals, Tampa Bay Buccaneers and Houston Texans that
benefit dealer groups in those areas.
"NFL is a critical part of the mix in
the fourth quarter [of the year], so we
are all hoping the season will go on
as planned," Hyundai said in a statement to Automotive News. "Given all
the challenges with other sports this
season, we are being cautiously optimistic."
Toyota Motor North America has
maintained its halftime sponsorships for the Thursday and Sunday
night broadcasts, which is the same
approach as last year.
Vinay Shahani, the automaker's
vice president of integrated marketing operations, said Toyota is relying
on its long-standing partnerships,
such as with the NFL, to reach its diverse customer base "during this unprecedented time."
"We are optimistic that the precautions implemented by the league
will result in a successful season for
the NFL and its sponsors," Shahani
said in a statement.
Ed Williams, vice president of
growth and strategy at Kantar, expects auto brands to take a more
measured approach to NFL spending this season.
"It probably won't be at the levels
that were seen previously," Williams
said, "but I still think there's going to
be some strong participation." a
in recent years.
At the 2019 Shanghai auto show,
Toyota debuted the battery version
of the C-HR crossover for the Toyota
brand and Lexus' first EV product,
the UX 300e. Nissan premiered the
14th generation of the Sylphy sedan.
At the 2018 Beijing auto show, the
plug-in variants of the Toyota Corolla and Levin sedans made their global debut, along with the all-new Lexus ES sedan. Nissan unveiled the
battery version of the Sylphy.
But for this month's Beijing show,
the two Japanese auto giants say they
are not planning any global premieres. m
Hans Greimel, Douglas A. Bolduc
and Christiaan Hetzner contributed
to this report.

Automotive News - September 7, 2020

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