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Carmakers spend big at Detroit

2007-01-05 13:41

David N. Goodman

The world's automakers are spending big at this year's Detroit Auto Show in hopes that vehicle buyers will do the same.

The more than $200 million cost of the exhibits - and the scores of new models on display - are designed to impress car executives, analysts, reporters and the general public alike and help fill auto showrooms in 2007.

"It's a great opportunity for us to get our message across," Timothy Peters, assistant director of auto shows for General Motors, said Tuesday.

The world's top-selling carmaker's display seeks to convey the message of "one car corporation with eight divisions," Peters said, standing in front of the still-rising GM exhibit area at Detroit's downtown Cobo Center.

The smell of fresh paint and sawdust and the buzz of power tools filled the air Tuesday, five days ahead of the start of the show's media preview. Touring reporters dodged construction workers and stacks of lumber as show co-chairmen Bob Thibodeau Jr. and Carl Galeana guided them around the 67 500-square-meter show hall.

"Every year, you see the manufacturers trying to outdo one another," Thibodeau said. "It gives these manufacturers a big marketing push worldwide."

Among this year's display highlights are an ice-skating rink and ice wall installed for DaimlerChrysler AG's Mercedes-Benz division. LED video screens are everywhere, some stretching from floor to near the 7.5-meter ceiling.

Auto shows are more than just a chance for carmakers to show car-shoppers their new offerings, said Erich Merkle, director of forecasting for the auto consulting company IRN Inc. in Grand Rapids.

Merkle said the 6,000 plus journalists from 75 countries help to "create a buzz" that extends far beyond the 750 000 or so members of the public expected to pass through the doors January 13-21.

The show opens for media previews on Sunday and to auto suppliers on January 10.

What everyone from dealers to investors wants to see is if carmakers, particularly the struggling US-based GM, Ford and DaimlerChrysler's Group have offerings that can compete with Japan's Toyota, Honda and Nissan.

"People ... are worried quite frankly about the health of the Big Three," Merkle said. "What are they doing to turn their fortunes around?"

This year's spotlight will shine on GM's new crossover sport utility vehicles, the Buick Enclave, GMC Acadia and Saturn Outlook, as well as on Chrysler's redesigned minivans, he said.

The Detroit show is marking its 100th anniversary this year under the sponsorship of the Detroit Auto Dealers Association. It draws the chief executives of all major automakers, as well as about 2 100 representatives of supplier companies, Thibodeau said.

Much of the action takes place behind the scenes in the show's 88 meeting rooms, when the automakers and parts suppliers sit down to plot strategy, he said.

"Detroit's kind of the granddaddy," Merkle said. Once the unchallenged king of the auto shows, it now shares the spotlight with an annual show in Geneva and shows every two years in Tokyo, Paris, and Frankfurt, Germany.

This year, automakers plan to unveil 50 or more new vehicles in Detroit, in addition to smaller numbers at auto shows in Los Angeles a month ago, February 7-18 in Chicago and April 6-13 in New York.

The winner in all this should be the buying public, Merkle said. "This is just a great time if your an auto critic or a consumer," the analyst said. "The quality is there and the prices are good. Cars have never been more affordable than now."


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