Automakers Ponder Halt Of TV Ads

DETROIT March 19, 2003; The AP reported that Toyota Motor Corp., said Wednesday it will cease TV advertising on the major networks for an indefinite period in the event of war with Iraq.

The other top automakers, who rank among the biggest advertising spenders in the United States, say they'll make most decisions on television advertising if and when the fighting starts.

"We'll probably put things on hold for as long as a week, then re-evaluate and start to reinstate our advertising depending on circumstances and the progress of the war," said Toyota spokesman Mike Michels.

At the start of war coverage there generally is not a lot of availability for television advertising as networks pull ads in favor of round-the-clock reporting. Many automakers want their ads and products to be associated with happier, family-type activities. Automakers also want to ensure if they do run advertising, it is appropriate to the events at hand.

If other carmakers mirror Toyota and hold their ads for a length of time, media entities could lose a huge source of ad revenue.

Domestic automakers and their dealers spent $7.2 billion in total advertising last year, more than any other industry, according to New York-based CMR/TNS Media Intelligence. Foreign automakers were a close second with a tally of $7.1 billion.

Toyota shelled out $937 million advertising its products in the United States last year, 16 percent more than the year before.

Michels said Toyota's decision to pull ads from ABC, CBS, NBC and others might be a moot point during the first days of a potential conflict, when live coverage will likely air continuously.

"The networks have told our advertising folks, quite honestly, that there won't be any place to put the ads," he said.

CNN plans to go commercial-free for the first two or three days of war coverage, then phase in ads for automakers and other advertisers.

"We're in constant communication," said Greg D'Alba, executive vice president for sales at CNN. "Some advertisers will be out three days, some for a week, some for two weeks."

Toyota, whose U.S. market share including the Lexus brand increased to 10.4 percent last year, likely will maintain some advertising on cable TV.

General Motors Corp., the world's largest automaker and the nation's top advertiser, said Wednesday it has contingency plans in its contracts for two major events it's sponsoring in the coming days -- the NCAA men's basketball tournament and the Academy Awards.

The college basketball tournament begins Thursday and will air on CBS. The Oscars will be presented Sunday and carried by ABC.

GM's Pontiac division is a major sponsor of the NCAA tournament, and the automaker plans to run commercials for Cadillac during the Academy Awards telecast.

Likewise, Ford Motor Co., the world's No. 2 automaker, said it had options for wartime advertising but didn't want to discuss them.

"Since we don't know the extent or length or response for any type of military action -- or, frankly, what the television networks' plans will be -- it would be premature to talk about specifics," said Ford spokeswoman Jennifer Flake.

ABC has said it will do whatever is necessary to report breaking news, which could involve interrupting the Oscar telecast.

CBS has discussed switching the NCAA men's basketball games to ESPN or other outlets. ESPN and ESPN2 are scheduled to show the NCAA women's tournament.

"We'd be disappointed from the perspective that it's likely the viewership for the NCAA games would be diminished if they're not on CBS," said GM spokeswoman Ryndee Carney.

General Motors led all U.S. advertisers in 2002 with a tab of $2.5 billion, followed by Procter & Gamble Co.'s $2.1 billion and AOL Time Warner Inc.'s $1.8 billion, according to CMR/TNS Media Intelligence.

Three other automakers were in the top 10 -- Ford at No. 4, DaimlerChrysler AG at No. 5 and Toyota at No. 9.

DaimlerChrysler spokesman James Kenyon said the company didn't plan major changes in its advertising strategy. He said the company would shy away from TV newsmagazine shows and target other prime-time programming and sports.

DaimlerChrysler AG, http://www.daimlerchrysler.com