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Any more Detroit Auto Shows?...the city goes bankrupt.

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Old 07-19-13, 11:58 AM   #1
mmarshall
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Default Any more Detroit Auto Shows?...the city goes bankrupt.

The City of Detroit officially folded and filed for bankrupcy yesterday (which is not surprising, as it has been deteriorating for years). Unfortunately, many city employees, creditors/debters, and municipal bond-holders (except for insured bonds) may be left high and dry, at least in the short run. But an interesting question from this might (?) be what happens to the future of the Detroit North American International Auto Show each January...arguably the largest Auto Show on the planet. Obviously, the money that the city gets from holding the show each January (added to the diminishing local tax revenues and what money the city already gets from the state and Federal governments) wasn't enough to stave off bankrupcy. Detroit officials, of course, are also not known for being scrupulously honest when spending what money the city does make, either....the last Mayor, for example, went to prison.

I've long argued (even here in CAR CHAT) that there is little sense in having (or at least continuing to have) what is arguably the world's largest auto show in an economic basket-case of a city like Detroit. Despite the city's long-ago-past as the nation's "Motor City", those days are long gone, despite some clever new TV commercials from Chrysler. Even much of the auto industry itself has moved out of Detroit and Michigan...to newer, lower-cost cities in the South and West. The money, population, and auto culture that was once in Detroit simply is not there any more. L.A./Southern California (and, to a lesser extent, the Washington, D.C. region) is now where the money, car-culture, and sales are (and, of course, the nation's worst traffic-jams/commutes). The D.C. area, on the average, sells six times the number of new cars that the Detroit area does, and the L.A./SoCal region ten times as much. Atlanta also has a big and rapidly-growing new-car market, but not quite to the size of D.C. or SoCal. Those are serious numbers, and they have (seemingly) been overlooked in keeping the world's biggest show in Detroit just for tradition's sake and nothing else.

So, while the future of the Detroit show, if any, has not been formally announced, it seems like the auto companies are also going to have to decide if they will keep sending such a large amount of their show-budgets and all-new displays to Detroit, or to a more promising region like L.A., D.C., or Atlanta to replace it. Of course, the current L. A. show is quite large (almost to the size of Detroit's itself)...but most of the official new introductions still happen (needlessly, IMO,) at Detroit. And those decisions are going to have to be made pretty soon, as it often takes months to plan for a major show.
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Old 07-19-13, 12:41 PM   #2
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Heard the news as well about Detroit going kaput. In California we got a few cities that went bankrupt this year as well and pretty much someone is going to prison when this happens. States are going to dig and so does the feds it's almost a certainty somebody currupt will be found out and made example of.

California already has the people running said bankrupt cities in trial and soon enough they will be going to a spa like resort (free soap and everything) courtesy of the tax payers.
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Old 07-19-13, 12:45 PM   #3
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The City of Detroit did not fold; it still exists. It is filing for protection from creditors to give it more time to negotiate with creditors; hopefully municipal employees and retirees will not be left high and dry.

Although much of the auto manufacturing has spread out to other states, especially the southern and Right to Work states, Detroit is still the centre of the American auto industry. The Detroit 3 are still in the area: General Motors is headquartered in the City, and although Ford and Chrysler do not have their HQs within Detroit itself, they are still in the suburbs of Detroit. The problem that Detroit is facing is one that many large cities in the United States face, and that is the hollowing out of the core, as businesses and the middle class that support the businesses move out to the suburbs.

Detroit is still known as the centre of the American auto industry and I believe that it is going to take much more than a mere bankruptcy filing to change this. Because of this reputation, the Detroit Auto Show has become an icon of not only the American auto industry, but the international auto industry. As long as the Cobo Centre (not owned nor run by the City of Detroit as far as I know) is still able to host the Show, as long as automakers from around the world are willing to congregate there each January, and as long as show-goers and media (from around the world) are willing to flock to Detroit for a few days each January, I see no reason why the North American International Auto Show should be cancelled.
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Old 07-19-13, 12:53 PM   #4
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Originally Posted by Sulu View Post
The City of Detroit did not fold; it still exists. It is filing for protection from creditors to give it more time to negotiate with creditors; hopefully municipal employees and retirees will not be left high and dry.

Although much of the auto manufacturing has spread out to other states, especially the southern and Right to Work states, Detroit is still the centre of the American auto industry. The Detroit 3 are still in the area: General Motors is headquartered in the City, and although Ford and Chrysler do not have their HQs within Detroit itself, they are still in the suburbs of Detroit. The problem that Detroit is facing is one that many large cities in the United States face, and that is the hollowing out of the core, as businesses and the middle class that support the businesses move out to the suburbs.

Detroit is still known as the centre of the American auto industry and I believe that it is going to take much more than a mere bankruptcy filing to change this. Because of this reputation, the Detroit Auto Show has become an icon of not only the American auto industry, but the international auto industry. As long as the Cobo Centre (not owned nor run by the City of Detroit as far as I know) is still able to host the Show, as long as automakers from around the world are willing to congregate there each January, and as long as show-goers and media (from around the world) are willing to flock to Detroit for a few days each January, I see no reason why the North American International Auto Show should be cancelled.
A good reply. I don't totally agree with it, but you bring up a couple of good points. Still, one big problem in that area is that they just don't sell that many cars there. The city's middle-class is mostly gone, and the lower-income people there generally can't afford new cars. In fact, never mind new cars......some of them can barely afford a ticket to the show itself (if tickets aren't given out free, like local car-dealerships here do if extra passes are available).

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The City of Detroit did not fold; it still exists
True, it will follow standard bankrupcy rules...but it is no longer truly functioning normally as a city, especially in the fiscal sense. I wouldn't want to be a city employee right now, with my future retirement/pension in question, even if things do recover some.
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Old 07-19-13, 02:56 PM   #5
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as long as automakers from around the world are willing to congregate there each January, and as long as show-goers and media (from around the world) are willing to flock to Detroit for a few days each January, I see no reason why the North American International Auto Show should be cancelled.
There's 3 reasons right there! ^^^

This was the big show to unveil new models, for the past 5 years or more the LA show gets this honor to unveil a few models every year. Now that the LA show begins & ends before the Detriot show I'm sure more debuts will happen in LA. If you are a automotive journalist flying in to report on new vehicles, where would you prefer to go. Many car companies have already abandoned Detriot & I will be surprised if the show goes on as usual next time.

Detroit the city killed by UAW
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Old 07-19-13, 03:29 PM   #6
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Detroit's bankruptcy will not affect the NAIAS/Detroit auto show:
http://www.detroitnews.com/article/2...text|FRONTPAGE
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Old 07-19-13, 07:35 PM   #7
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Originally Posted by scgt652 View Post
Detroit's bankruptcy will not affect the NAIAS/Detroit auto show:
http://www.detroitnews.com/article/2...text|FRONTPAGE
Thanks for the information. Good to know.
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Old 07-19-13, 09:19 PM   #8
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Originally Posted by scgt652 View Post
Detroit's bankruptcy will not affect the NAIAS/Detroit auto show:
http://www.detroitnews.com/article/2...text|FRONTPAGE
Good to hear indeed. Even though the State/City is messed, no reason to punish Enthusiasts/Media
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Old 07-19-13, 10:26 PM   #9
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Detroit officials, of course, are also not known for being scrupulously honest when spending what money the city does make, either....the last Mayor, for example, went to prison.
This is the reason Detroit is in its current mess IMO. The city has been run for decades by corrupt mayors and council members. They have run it into the ground. Granted there are a bunch of other outside factors to blame for Detroit's decline, but IMO things NEVER should have gotten this bad.

If there was real leadership in Detroit back in the 60's/70's/80's/90's that could have brought in other industries and businesses besides autmotive/manufacturing, things wouldn't be nearly this bad. There is an old Russian saying, the fish rots at the head. Nobody in their right mind wanted to relocate their business to Detroit proper in the past 4 decades because of the severe dysfunction in the city government. You can see it in the suburbs around Detroit. Granted they aren't flourishing, but they're holding on a lot better than the city itself.
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Old 07-20-13, 07:25 AM   #10
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Originally Posted by scgt652 View Post
Detroit's bankruptcy will not affect the NAIAS/Detroit auto show:
http://www.detroitnews.com/article/2...text|FRONTPAGE
Thanks for posting. Well see, next January, if that article is actually correct or not.

If it IS correct, IMO, they may just be pouring more money down the drain.
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Old 07-20-13, 10:47 AM   #11
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Default NAIAS Exec Says Detroit's Bankruptcy Won't Impact Show in Any Way

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At the same time that a Michigan state judge challenged the legality of Detroit's bankruptcy ruling the filing unconstitutional and ordering the city to withdraw said petition, in what looks to be a very lengthy legal battle that will continue for months, the North American International Auto Show (NAIAS) organizers came out with a statement attributed to Executive Director Rod Alberts.

You can read it in full below, but as an appetizer, Alberts says that Detroit's bankruptcy was in the making for years and that given the city's situation (and by that, he means the towering debt and limited tax revenue), it was "a good decision".

He continues saying that the bankruptcy filing "will have no impact" whatsoever on the show that brings over "$350 million in economic impact to the Southeastern Michigan region".

We'll remind you that the next edition of the Detroit motor show is scheduled for January 13-26, 2014.

Rod Alberts, Executive Director, North American International Auto Show:

"The Detroit Chapter 9 bankruptcy has been anticipated for some time and will have no impact on the North American International Auto Show (NAIAS). The bankruptcy filing was a good decision, given the state of affairs of the city over the past decade, and will give Detroit an opportunity to move forward by relieving the city of a legacy of liabilities - giving it a fresh start. That was the sole purpose. The direction by Detroit Mayor Dave Bing and Michigan Governor Rick Snyder was the right one, and will help Detroit turn the corner. Although surprising to many, it was a bold and positive move.

Cobo Center is independent of the city and is managed and operated by a regional authority, so no funding from the city is needed for Cobo. The NAIAS is also an independent organization and will not be impacted in our operation or funding, although we do work with all the city municipalities in the region, including the City of Detroit, and will continue to do so.

An interesting aspect of this, too, is the fact that we are soon to complete the third and final stage of the $300 million renovation of Cobo this coming year. Again, this is because Cobo Center is managed by a regional authority and is funded accordingly with regional and state funds.

The city bankruptcy will have no effect on the show's ability to provide the venue that the world automakers have come to expect, and the event that each year brings more than $350 million in economic impact to the Southeastern Michigan region.

We will continue, as planned, to work side-by-side with international auto manufacturers, which continue to rely on Detroit's stage to make their worldwide product introductions."
http://www.carscoops.com/2013/07/nai...uptcy-won.html
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Old 07-22-13, 09:35 AM   #12
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This is the reason Detroit is in its current mess IMO. The city has been run for decades by corrupt mayors and council members. They have run it into the ground. Granted there are a bunch of other outside factors to blame for Detroit's decline, but IMO things NEVER should have gotten this bad.
D.C. is the same way, with a long history of corrupt leadership at the city-government level. The difference is that, here in Washington, Congress is right here to oversee the city (as a Federal enclave) and correct things if they get really out of hand (as they did back during Marion Barry's mayorship by appointing a special Congressional board to run some parts of the city government). Detroit, in contrast, is several hundred miles away and less-accountable to the Federal government.

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If there was real leadership in Detroit back in the 60's/70's/80's/90's that could have brought in other industries and businesses besides autmotive/manufacturing, things wouldn't be nearly this bad.
The main problem with Detroit's auto industry is that the auto companies themselves brought a lot of their own problems on them...they can't blame that on it on the city government. The quality of American-designed/built-cars dropped sharply in the 1970s (late 60's, in fact, for Chrysler and AMC), and despite many warnings from auto-buyers that it was unacceptable, remained that way for decades.
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Old 07-22-13, 09:39 AM   #13
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I hope to make it there this year to see the debut of the RC F. Good to see it still alive. We had a thread here a few years ago about the demise of the NAIAS and it clearly was greatly exaggerated.

It is my hope Detroit gets it together after this re-org and the show shows the bright point/parts of the city.
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Old 07-22-13, 09:59 AM   #14
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I hope to make it there this year to see the debut of the RC F. Good to see it still alive.
It is my hope Detroit gets it together after this re-org and the show shows the bright point/parts of the city.
I agree with you to some extent, but it still doesn't make sense to me why they insist on continuing that show simply for tradition's sake (and new-car introductions), when it is clear that much of the industry (including assembly-plants and even some corporate-headquarters itself) moved away from Michigan for a number of reasons. L.A./SoCal, D.C.-Baltimore (and even your home town of Atlanta) all far overshadow Detroit today as a center of automotive sales and money. Lincoln-Mercury, for example, left its division-HQ in Detroit for L.A. a number of years ago. Mercury's eventual demise was also clearly not related to the move, but to the idea that Mercurys were considered simply money-wasting rebadged Fords.

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We had a thread here a few years ago about the demise of the NAIAS and it clearly was greatly exaggerated.
Yes and No. Some manufacturers, BTW, DID pull out of the Detroit show. Porsche hasn't had a display there in years, clearly recognizing that its money and sales are in other regions....though, in fairness, they don't always have yearly displays here at the D.C. show any more either. Other manufacturers, like Mitsubishi and Suzuki, also pulled out of both the Detroit and D.C. shows several years ago, but it is unclear whether that was because of the actual auto market itself or simply the start of the financial demise of both companies. Suzuki, of course, is gone from the U.S. today, and I would not be surprised if Mitsubuishi, despite repeated insistance to the contrary, doesn't soon follow.
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