Cash-Strapped Automakers Still Sponsoring NASCAR
Sunday, February 15, 2009
DAYTONA BEACH, Fla. -- They are lined up side by side, three rows deep -- shiny Silverado pickups, Tahoes with fuel-management systems, Malibus equipped by OnStar, muscular Corvettes, an Equinox that emits only water vapor and new-edition Camaros.
Amid the roar of 600-horsepower NASCAR engines, hundreds of stock-car fans teem around the new Chevrolets on display at the 15,000-square-foot showroom outside the fourth turn of Daytona International Speedway like ants on a picnic basket.
The speedway hosts NASCAR's biggest event on Sunday, the season-opening Daytona 500. But a different sort of competition has unfolded all week on its grounds, where auto manufacturers vie for the attention of the fans streaming into the track -- 160,000 on race day alone -- each one a prospective car buyer.
At the Chevrolet display, which has the feel of a county fair with its big stage, white circus tent and hydraulic-operated powerboat ride, NASCAR fans poke under vehicles' hoods, climb in front seats, honk horns, fill souvenir bags with literature about the new models and pose for pictures beside the ones they covet most.
If they have questions, one of 10 "product specialists" swoops in with a friendly smile and quick answer. And all the while, tiny cameras attached to banners overhead film the proceedings, to be analyzed later by software that decodes how many NASCAR fans visited the display and which vehicles commanded the most attention.
Amid plunging stock values, mass layoffs and unprecedented plant closings, Detroit's Big Three have slashed their marketing budgets, retrenching from such valuable sports properties as the Olympics, Super Bowl and PGA Tour. And though each has cut spending on NASCAR, as well, all three are clinging to their multimillion-dollar association with stock-car racing as the most fertile ground for cultivating buyers.
In the case of General Motors and Chrysler, which accepted $13.4 billion and $4 billion respectively in federal bridge loans, a certain amount of taxpayer money is footing the bill.
But while some lawmakers have questioned the propriety of troubled banks venturing into sports marketing, such as CitiGroup's $400 million, 20-year naming-rights deal for the New York Mets' ballpark, none, to date, has objected to struggling automakers investing in NASCAR.
The two are uniquely entwined.
"There has never been -- and may never again be -- a sport more authentically and financially tied to an industry as NASCAR is to auto manufacturing," said David M. Carter, executive director of the University of Southern California's Sports Business Institute.
For decades, Detroit has supplied the competitive fodder for NASCAR's races -- currently Chevrolets, Fords and Dodges -- with Toyota joining the ranks in 2007. And NASCAR, in turn, has spawned millions of brand-loyal fans predisposed to buying products that support the sport they love, whether that's Budweiser, Cheerios or Chevrolet.
While NASCAR fans might be cash-strapped at the moment, industry executives say there's still no better place for U.S. automakers to tempt potential buyers with the fantasy of driving a 2010 Chevy Camaro or Dodge Charger than at Daytona.