For the primary time in 23 years, none of America’s 4 largest automakers will air nationwide Tremendous Bowl advertisements – however foreign-owned corporations like Kia and Volkswagen are selecting up their slack. The “challenging U.S. automotive market” is a number one motive why.
Slowing client demand and excessive rates of interest are pressuring Ford, Toyota, GM and Chrysler guardian firm Stellantis into slicing again on their advert spend. Automotive commercials are a Tremendous Bowl mainstay – Stellantis alone has solely missed two previously 15 years – however this 12 months’s sport would be the first since 2001 the place not one of the Large 4 are coughing up the estimated $7 million fee for a 30-second spot, based on AdAge’s archive.
“With a continued focus on preserving business fundamentals to mitigate the impact of a challenging U.S. automotive market …we will not be participating in the Big Game this year,” wrote a Stellantis spokesperson in an announcement to Fortune. Toyota advised Fortune that in lieu of an advert, it would “activate on the ground” with an “exciting, multi-faceted activation experience” each main as much as and in the course of the sport, noting that it’s at present the NFL’s official automotive sponsor. GM, for its half, confirmed that none of its manufacturers would promote in the course of the Tremendous Bowl and mentioned it frequently updates its media methods “to make sure they align with our business priorities.” Ford couldn’t be instantly reached for remark.
The EV winter?
The auto trade might be dealing with an extended hangover after a brutal 2023. Racing to catch as much as runaway trade chief Tesla, legacy producers had collectively poured roughly $100 billion into mass-market EV manufacturing as of November, according to Bloomberg – however sales lagged behind projections, customers complained about reliability points and most fashions are nonetheless too expensive for the average consumer, even with the assistance of tax credit. Within the current brutal January winter storm and “bomb cyclone,” Teslas failed to charge for unlucky Chicago consumers in subzero temperatures, possible as a result of they didn’t learn the advantageous print about the way to “precondition” their batteries.
Not one of the corporations Fortune reached out to explicitly cited the powerful 2023 EV market as the explanation for his or her Tremendous Bowl promoting pullback, however simply have a look at their earnings—the EV scramble has weighed closely on their steadiness sheets previously 12 months. Ford alone estimated in June that its EV division would cost it $4.5 billion in 2023. GM walked back its EV production target in October, citing a slowing market.
Even Tesla, the far-and-away trade chief, was hit by 2023’s tough and tumble EV local weather. CEO Elon Musk’s EV large reported its first quarterly loss since 2020 final fall, and an government not too long ago admitted the company was in a “moderate low-growth period” after a yearslong bull run. This 12 months hasn’t been any higher: Tesla misplaced over $94 billion in market valuation within the first two weeks of 2024—its worst begin to a 12 months in its historical past as a public firm—because it digests dangerous information starting from Hertz backing out a provide deal to a different value minimize in China to costly labor prices.
A poor broader trade outlook hasn’t helped the sagging EV sector, both. Though American complete auto gross sales rose 12% last year, they’re nonetheless lagging behind pre-pandemic ranges. And cooling consumer demand – together with manufacturing disruptions such as strikes and supply chain issues – paint a cloudy image for the home automotive trade in 2024.
Nonetheless, EVs will take middle stage this Tremendous Bowl, as Kia promotes its newly launched EV9 SUV. Volkswagen is operating an advert for the primary time in 10 years, which it teased yesterday. The German firm is celebrating its seventy fifth 12 months of enterprise within the US. Each corporations have been aggressively pushing their EV choices, with every reporting over 60 percent annual sales growth as of final October – they every promote about 3 % of EVs nationwide. However each nonetheless lag properly behind Tesla, which instructions a whopping 56.5 % of the brand new EV market.
Beyond financial circumstances, a part of the explanation the Large 4 have all handed on advertisements might be timing. Toyota, which final fall signed on because the NFL’s exclusive automotive partner at a reported value of as much as $50 million a 12 months, isn’t releasing any main new merchandise that coincide with the February 11 Tremendous Bowl date.
“I can’t think of a vehicle that [Toyota] needs to advertise at that level of exposure. These ads are expensive,” mentioned David Whiston, a Morningstar analyst.
