Tuesday, 31 March 2020

Postponed Detroit Auto Show Now Canceled, With Future in Doubt

It’s been a tough week for Detroit, with the president yapping at US automakers to produce ventilators, shields, and masks faster. Now the date-shifted North American International Auto Show is kaput for 2020. Last held in January 2019 and slated this year for June 2020, the show organizers called it off when it became likely the downtown convention center, TCF Arena, would be requisitioned for use as a FEMA field hospital to support hospitals overtaxed treating coronavirus patients over the summer.

The show has now been reset for June 2021 as a convention-center auto show, plus rites-of-spring outdoor events along the Detroit River.

Detroit’s convention center, Cobo Hall, in 2018, now called TCF Center, after the frozen yogurt company. Sorry, we meant bank. TCF has 300 branches, about 10 times as many as TCBY has flavors.

Auto Shows in Free-Fall Before the Pandemic

It has been a tough year and a half for auto shows. How tough?

  • Detroit, the North American International Auto Show, was most recently held in January 2018. Where it’s cold and snows. A couple of times in the past two decades, auto execs and press people were stranded in Detroit because Detroit Metro Airport was snowed in. Journos had nothing to do … except write snarky articles. The show was reset for June 2020, a 17-month gap, and now it’s off until 2021.

  • The world’s most important show, Frankfurt (IAA), saw attendance fall at the odd-years-only  September 2019 show from 931,700 in 2015 to 810,000 in 2017 to just 561,000. Opel board member Karl-Thomas Neumann called it a “huge fail.” (Isn’t it nice when businessmen speak their minds, even if it annoys the Frankfurt Convention Bureau?) Sponsors put the 2021 show’s location out for bid. The commercial vehicles show continues in Hannover in September 2020. For the auto show, Munich won over Berlin, Hamburg, and three others for the next show in the fall of 2021.
  • The Los Angeles Auto Show went off in November 2019 and generally did well, in part because of its heavy emphasis on alternative-energy vehicles. Also, LA is a nice place for auto execs and the media to be heading into winter. LA is the de facto auto capital of the Americas because of design and tech centers in SoCal and Silicon Valley, plus the number of international automakers with US headquarters there. Unlike in Detroit, there’s no hometown bias in the media coverage. LA took on a life of its own when it gave up its early January date in 2006 for November/December. For now, the 2020 show is still on, Nov. 18-29. LA’s biggest problem is the convention center is small and cut into two halls that are a five-minute walk apart.
  • The Chicago Auto Show, the fourth of the three major US auto shows, went off Feb. 13-21, 2020 and was the last major or mid-major auto show to be held. For impact, Chicago ranks just behind the three international US shows – Detroit, New York, LA – but is the envy of the others for the best show facility, McCormick Place. It’s the one US site that can handle a million visitors. Should that many people show up for an auto exposition in the near future.
  • The Geneva International Motor Show (GIMS) was slated for March 2-15, just as the expanse of the coronavirus epidemic in China became evident. Automakers had been pulling their top execs back from the show, and days before the Swiss government banned gatherings of more than 1,000 people, which ended the show. Geneva is considered one of the Big Five auto shows of the world – Frankfurt, Geneva, Detroit, Paris, Tokyo – but its attendance slipped in previous years. Non-participants included Cadillac, Ford, Jaguar, Lamborghini, Land Rover, Mitsubishi, Nissan, Peugeot, Citroen, Opel, Vauxhall, Subaru, Tata, Tesla, and Volvo. But the show went on, online: Virtually every automaker with a major introduction live-streamed the rollout from headquarters.
  • The New York International Auto Show (NYIAS), scheduled every year starting the Wednesday before Easter (April 8) and running a week and a half, postponed the show to one of the least desirable times of the year, the week and a half leading up to Labor Day weekend. Press days are Aug. 26-27, with public days through Sept. 6. Greater New York is one of three sales hotspots for luxury cars along with SoCal and Miami, but Audi, BMW, and Mercedes-Benz said they’ll skip the show.
  • The Paris Motor Show, Oct. 1-11, just announced the main part of the show has been canceled. For now, off-site events are planned: Movin’On and Smart City.
  • The Tokyo Motor Show, Oct. 22-Nov. 2, has made no announcement of plans for this year.

Happier days: Steve McQueen’s exuberant granddaughter Molly McQueen, in 2018 at the rollout of the new Ford Bullitt Mustang, done in the same Dark Highland Green as in the 1968 movie.

Detroit’s Tough-Luck Story Gets Tougher

Detroit 2018 press days: Selfies against the Detroit River next to Cobo Hall with (we’re not sure) clouds reflected in the water. Or ice floes.

It has been a difficult week for the auto show, Michigan-based automakers, and the state’s economy. Detroit will now be going almost two and a half years between shows. More than any other city and show, the automakers and auto dealers have used NAIAS to remind themselves of past glory: when US automakers sold half the cars in the US and when GM alone sold half the cars (1962).

Even as market share shifted away from the Big Three – GM, Ford, and the Chrysler-Ram-Dodge part of FCA – Michigan remains the auto engineering capital of the Americas. When the automakers shed employees in the past 20 years, many of them went to work for big US suppliers such as Magna or Lear, or international suppliers with big presences: Bosch, Denso, Continental, ZF, Aisin, Hyundai and the like. At the same time, the era of Rust Belt assembly line jobs paying $30 an hour is gone and will never come back. Manufacturing growth, with factory workers making $15-$20 an hour to start, is in the new south: the Carolinas, Georgia Alabama, Mississippi, and Texas. Plus Tesla in California using a former Toyota/GM plant to build a small-scale EV company in one with the largest market value outside Toyota.

A GM technician setting up and testing machinery to produce Level 1 face masks in Warren, Michigan. GM will ramp to 50,000 masks per day within two weeks, and later to 100,000 if there’s need. (Probably will be.)

Meanwhile, POTUS Blasts GM

This should have been a good-news story week about automakers pitching in to help fight coronavirus (as have many industries). Ford, GM, and Chrysler (FCA) are recalling employees to build masks, face shields, and even respirators. At the same time, the White House has been praising and then criticizing the automakers for not being in production already.

Friday President Trump castigated GM and CEO Mary Barra for slow-walking production plans to build ventilators. This was the event where the president said both “General Motors” and “General Electric” in the same extended sentence and described the federal relief package as “$2.2 billion …. $2.2 trillion.” GE does make ventilators through its healthcare unit. GM is partnering with Ventec Life Systems. Insiders at GM and Ventec said the past week was not GM stalling, but cutting red tape and expediting parts ordering, finding the best-skilled workers, and getting plants ready. According to a story in Tuesday’s New York Times:

President Trump on Friday accused G.M. and its chief executive, Mary T. Barra, of dragging their feet on the project and directed his administration to force the company to make ventilators under a 1950s law. But accounts from five people with knowledge of the automaker’s plans depict an attempt by G.M. and its partner, Ventec Life Systems, a small maker of ventilators, to accelerate production of the devices.

With deaths surging as cases snowball, the two companies have moved urgently to find parts, place orders and deploy workers, the people said. Tasks that normally would take weeks or months have been completed in days. The companies expect production to begin in three weeks and the first ventilators to ship before the end of April.

Why automakers? They have big assembly lines that are the opposite of clean rooms. But they also have smaller, cleaner prototype rooms and rapid-development assembly areas that can, and will be, repurposed. One of the things automakers do well is source parts from third parties.

In the making of a car, we’re almost a century removed from the Ford River Rouge plant, where freighters docked at the 900-acre factory with iron ore and a finished Model A came out the other end. Instead, an automaker may produce the highest-value items itself, typically engines, and outsource tires, wheels, transmissions, infotainment, and driver-assist electronics, sometimes even body panels.

Some outside the administration allege that the executive branch is pressing GM, and many others, to light a fire now in order to make up for lost time responding in January. Multiple reports say the CDC and national security advisors in January described the coronavirus as out of control and on the way to being a pandemic – an epidemic that reaches much of the world.

Regardless, protective equipment and ventilators will begin flowing soon from automaker factories and other sources. At the same time, doctors, nurses, and hospital staff are stuck reusing old masks or creating makeshift protection until the so-called “arsenal of health” starts flowing. And with no end in sight for people suffering from Covid-19, there won’t be many auto shows, large or small, in the near future.

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from ExtremeTechExtremeTech https://www.extremetech.com/extreme/308522-postponed-detroit-auto-show-now-canceled-with-future-in-doubt
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