The Economic Times

Climate change, trade woes reshape Frankfurt Auto Show

​Sluggish sales
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​Sluggish sales

World sales of cars are expected to slip to 78.3 million this year, from 83.0 million last year. The US-China trade conflict has hurt economic growth in China and dented earnings at companies like Germany's BMW and Daimler, both of which make cars in the US for export to China. Europe's car market grew only 0.1% last year amid weakening economic growth.

On top of that comes continuing uncertainty over the terms of Britain's departure from the EU, currently slated for Oct. 31. British Prime Minister Boris Johnson has said he is willing to leave without a divorce deal that would smooth the transition to new trading arrangements. A no-deal Brexit could disrupt business between Britain and continental Europe by imposing new tariffs and border checks, and the auto industry's supply chains are particularly vulnerable to such chaos.

In pic: A BMW M Next electric sports car stands at the 2019 IAA Frankfurt Auto Show in Frankfurt am Main, Germany.

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​Shifting marketing strategies
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​Shifting marketing strategies

The number of companies exhibiting at the show has dropped to around 800 from 994 during the last edition of the show in 2017, and some 30 major carmakers are staying away, including Alfa Romeo, Aston Martin, Peugeot Citroen, Fiat, Jeep, Mitsubishi, Nissan and Toyota. That's in part due to the costs of setting up at the show measured against returns in sales. Carmakers are also finding different ways of reaching the public, including by web-streaming vehicle launches and holding their own exclusive events away from the show.

Still, there will be a strong presence, especially by the German home team. Daimler's Mercedes is putting on four "experience rooms" to emphasize the technology, comfort and connectivity of its vehicles, in addition to the usual long rows of vehicles. The largest contingent is from China with 79 exhibitors.

In pic: German Chancellor Angela Merkel gets out of a transparent display showing autonomous vehicle components at the ZF Friedrichshafen AG stand during Frankfurt Auto Show.

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