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Next year, India’s biggest automotive spectacle, the biennial Auto Expo, will be devoid of some big brands.
Some companies wish to conserve cash and re-route it to product development and marketing, instead. Average spending for the week-long event, including the cost of floor rental, is Rs 5-15 crore depending on the floor space taken.
Bajaj Auto, Royal Enfield, Harley-Davidson, SkodaAuto, Volvo, Volvo Cars and Daimler will not be participating in the Expo, scheduled for February 2016 at the India Expo Mart, Greater Noida. At least four of these seven were at the 12th edition of the Expo in 2014.
Pune-based Bajaj Auto showcased two mid-segment and high performance motorcycles last year, in addition to the RE60 quadricycle. Managing Director Rajiv Bajaj said, “We are not participating. If we are not an Indian manufacturer and coming to India, I (would) want people to know me, (and then) I should participate. I will participate in Angola or Nigeria, where people don’t know me (Bajaj Auto). This condition does not apply to Bajaj Auto (in India).”
As has been the trend in the past, especially in the two-wheeler segment where competition is more severe than in cars, companies hesitate to disclose their product line-up, to avoid alerting peers. “If I am showing products that will come 3-6-12 months later, it is a huge forewarning to the competition. For instance, we only showed the RS and CS 400 last year which are in the niche segment. We never declared that we’d make the RS or AS 200 but we launched these a few months ago,” Bajaj added.
With a 25 per cent fall in sales last year, Volkswagen-controlled Czech auto brand SkodaAuto has decided against participating next year. The company is cutting costs by investing in improving its brand image, a boost to marketing and after-sales support, while being limited by a small product line.
A company spokesperson said, “We are unlikely to participate.” The average spend for the week long event, including the cost of floor rental, is between Rs 5-15 crore depending on the floor space taken.
One of world’s largest-selling premium motorcycle brands, Harley-Davidson, which made a big splash last year when it launched its cheapest bike in India (the Street 750, priced at Rs 4.1 lakh), has also decided against participating in the Expo. This will also be the first time since 2010 that the US-based cruiser maker has opted out of the mega event.
Though it did not specify why, sources said as it did not have a new product to showcase, as nearly all of its global products are already on sale in India, the company is not keen.
While a few companies blame high rentals at the Expo venue, executives at the Society of Indian Automobile Manufacturers (Siam) say the rentals are among the cheapest compared to other international expos, beside being cheaper than some local auto events.
“The rentals have not gone up since 2012 and it will be the same in 2016. It is the adornment cost which pushes up overall expenditure. At Rs 8,100/sq metre, the costs are the lowest in India and the world, compared to Rs 10,000-12,000 a sq m charged by other auto events in India,” said a senior Siam executive.
Despite all this, some new automotive brands would make their debut, shoring up the total number. For instance, Italian automobile company Fiat will showcase models under the Jeep and Maserati brands.
Siam hopes more companies will come on board in the coming months, such as two-wheeler racing brand Ducati. “Some more companies should come on board and we should have a clearer picture around November,” added an executive.
Companies are now increasingly considering a pre-Expo media event, as a much cheaper alternative. “Instead of an elaborate week-long affair I would rather have a media event just before the Auto Expo, which is much cheaper,” said a senior executive in charge of event planning at an auto company.
The average spending at a five-star hotel for a launch is Rs 30-50 lakh.
Daimler India Commercial Vehicles had done such pre-Expo events in the past. This year, it is yet to confirm if it would be at the Expo. A spokesperson said, “As of now, DICV has made no decision on participating. However, we will participate at the EXCON event in Bengaluru this year.”
