LOTS TO THINK ABOUT
Senior executives in global motor companies are having a torrid time in 2024 as they juggle numerous factors to try and keep their businesses financially viable and sustainable in the face of huge challenges.
Many are not only having to change tack in terms of their approach to the electrification of their vehicles as the promised switch to battery electric vehicles is proceeding at a far slower pace than expected (or hoped for) but now they even need to relook the methods they use to promote their products.
The slow acceptance of battery electric vehicles seems set to continue as the high rate of progress in battery and EV technology means new models can be out of date within a year or two of the customers taking delivery. As a counter, several makers have already delayed going full EV or are bringing back or adding hybrid or plug-in hybrid derivates to keep sales moving.
These factors are also having a devastating effect on residual values of BEVs. A survey conducted in the UK and the US by Wired, a US research company, showed some models such as the Ford Mustang Mach-E and Polestar lost more than 50% of their initial price in the first year. Even a Tesla Model 3 showed a 45% drop in value in 12 short months.
Another elephant in the room, autonomous self-driving vehicles, has gone onto the backburner as development costs rocket and legislative red tape makes these projects difficult to implement.
An important aspect that needs to be re-evaluated too is the way vehicles are marketed and promoted to lift them above the clutter of the competition, which now includes a host of newcomers – and start-ups – from China.
The big swing in recent years has been to use digital media and people known as “influencers” instead of the old recipe of focusing on the traditional motoring media, television advertising and events such as motor shows,
Generally, the so-called “legacy brands” have been turning their backs on motor shows over the past few years – something which has already led to the cancellation of future Geneva Motor Shows. This then left the doors to the shows open to mainly Chinese vehicle makers who made the most of this golden opportunity.
But now there is renewed interest in international motor shows, starting with the Paris Motor Show, which takes place from 14-18 October. German brands, such as Volkswagen, Audi, and Skoda, together with BMW and MINI, will all be there after missing the 2022 show. France will be represented by Renault, Dacia and Alpine, as well as the Citroen and Peugeot brands from Stellantis. Ford will be represented, as will Kia, Alfa Romeo, and Cadillac.
By contrast, there will be fewer major Chinese brands. MG, which is the biggest seller among Chinese brands in Europe, will give the show a miss, although BYD will be there again together with several smaller brands. (MG, together with BYD, had displayed vehicles at the last Geneva Motor Show, which took place in February.)
Now it seems there is renewed interest in taking the product to the people in South Africa too. The latest sign of this methodology is the Festival of Motoring which took place at Kyalami in August. The organisers, Messe Frankfurt, have been battling over the past few shows to attract a representative cross-section of local vehicle manufacturers, distributors, and dealers.
Now it seems the tide has turned and 23 vehicle brands were represented. Admittedly there were still some major players missing, such as Toyota, BMW (who have their own Kyalami event), and Mercedes-Benz but the list of those brands which took the opportunity to interact directly with motoring enthusiasts and would-be buyers makes impressive reading: Abarth, Alfa-Romeo, BAIC, Bentley, BYD, Chery, Citroen, Fiat, Ford, Haval, Isuzu, Jaecoo, Jeep, Lamborghini, Mahindra, Omoda, Opel, Porsche, Peugeot, Shelby, Suzuki, Volkswagen and Volvo.
This Festival of Motoring has also changed significantly in its format over the years and now there is even more focus on interactivity and personal experience than was the case with the static motor shows of the past.
This is an uncertain period for the global automotive industry, and it seems it will be the survival of the quick-change artists who are able to adapt rapidly as circumstances change and evolve.
by Roger Houghton
