High costs, negligible return on investment, unfavourable event location, poor event management and irrelevance of the event itself are some of the several reasons cited by top automotive brands for their non-participation in the biennial Auto Expo, India’s biggest automotive extravaganza which kicks off in mid-January.
Some two dozen automotive brands have decided to give Auto Expo 2023 a cold shoulder, including the entire top rung of the two-wheeler industry, the whole of the luxury car industry and some of the top names in the passenger vehicle category. The missing names make up more than 80% of India’s total domestic volumes.
Mahindra & Mahindra (M&M), the latest and the biggest brand who is set to give the event a miss, has already showcased its entire upcoming range of products, which includes five electric SUVs, leaving no reason for its participation. French car brand Citroen, the latest to enter India, has also chosen to stay away from the Expo, the need to draw crowds for brand building notwithstanding.
“The end-to-end costs at the Expo would be ₹30-₹50 crore for a week. I would rather use that money to fund 1-2 months of my marketing budget. ROI (return on investment) is pretty poor,” said an executive from one of the European automotive brands.
Companies from other segments avoid the Expo as they feel that the event largely focuses on car and SUV launches, leaving little space for bike, truck and bus manufacturers. In recent years, the emergence of other such events like the India Bike Week, Prawaas, Bus World, Excon, which has sector-specific focus, have attracted automakers.
“My target audience is a large fleet buyer. A typical visitor at the Auto Expo is not that audience. Therefore, it makes little sense for us to spend that much on a stall that can accommodate a maximum of 2-3 trucks for an audience who are not even my target,” said an executive of a truck and bus maker.
The effect of lack of enthusiasm by auto companies in the previous editions was visible on the footfalls the Auto Expo received. A total of 6,08,526 visitors attended the Expo in 2020, which was a growth of 0.55% over the 2018 edition when it received 605,175 visitors, which in turn was a growth of 0.54% over the 2016 edition when it received 601,914 visitors.
During Auto Expo 2020, the organisers, which includes the Society of Indian Automobile Manufacturers (SIAM), charged ₹9,500 per sq meter for the display area, which was higher than the ₹8,400 per sq meter charged during 2018. It was not immediately known if the rates will be revised for Auto Expo 2023.
Some of the other global auto shows like the Frankfurt Motor Show and EICMA (held in Italy) are more expensive. EICMA is focussed majorly on two-wheelers. While Royal Enfield does not participate in the India Auto Expo, it has repeatedly participated in the EICMA.
“Even if the display area rates are not hiked by the organisers, the effect of inflation will be seen on other aspects like food and beverage, security, lighting equipment and decoration, electricity cost, public relations and event management personnel costs, transportation, celebrity endorsement costs and accommodation,” said another executive of a car company.
Though a majority of the automotive industry have given a thumbs down to the Auto Expo, regulars like Maruti Suzuki and Tata Motors and relatively smaller brands like MG Motor and BYD will have products that will be making a fresh debut at the Expo.