Recaro GmbH is using a racing venue in a bid to boost its presence in North America.
The German seat maker and its new joint-venture partner, Johnson Controls Inc., hope participation in the 1998 ITT Detroit Grand Prix, held this past weekend, and the popularity of racing will make Recaro more visible.
'Being here in the Motor City, I think (the Grand Prix is) an excellent opportunity,' said Liz Pinto, marketing director for Recaro North America Inc., the Clawson, Mich.-based subsidiary of Recaro GmbH.
About 50 auto-related companies rented suites around the Grand Prix track and entertained potential customers during the three-day, four-race event. The Grand Prix this year attracted several newcomer automotive suppliers such as Recaro, Dow Automotive, Findlay Industries Inc., Framatome Connectors Inter-national and Amcast Industrial Corp., said Mike Broadwell, sales manager for IMG Detroit, the sports marketing firm that has run the Detroit Grand Prix since 1994.
'It's an opportunity for the salesman to spend the whole day with the client,' Broadwell said.
For Recaro, entertaining its 75 guests was relatively inexpensive. The suite cost Recaro $11,000 for three days, not including catering expenses, Pinto said. The company spent another $16,000 to be a Grand Prix sponsor, which put the Recaro name on signs around the racetrack.
Larger companies such as Johnson Controls and ITT Auto-motive - which rank 5th and 13th, respectively, on the Automotive News list of top suppliers in North America - spent considerably more. ITT has spent millions to put its name on the annual event through 2002 and will host about 900 guests at the Grand Prix this year, Broadwell said.
At the last minute Johnson Controls paid an undisclosed sum to rename the Grand Prix's Trans Am series race the 'Johnson Controls 100' for this year and possibly for future races. The race had been called the Motor City 100. Johnson Controls also is the chief sponsor of a Trans Am series racing team featuring drivers Paul Gentilozzi and Bill Saunders. Recaro supplies the seats for the two cars.
The cost of sponsoring a racing team varies from series to series. Sponsoring a team in the more popular CART racing series 'might be a $6 million deal,' Broadwell said.
But through its team sponsorship, Johnson Controls can show off the Recaro seats and eventually a new tire pressure monitoring system at race events throughout the country. 'It gives you the ability to more or less move your show from market to market,' Broadwell said.
'Racing certainly has been using a lot of advanced technology to either enhance the performance of the teams or handle the strategic side (of the race),' said Jeff Steiner, Johnson Controls' marketing and communications director.
The two Johnson Controls AutoLink cars also serve as billboards for the company's upcoming AutoLink 'intelligent communications system,' although they will not carry the system, according to Johnson Controls. AutoLink, to be released this fall, links vehicles to a satellite-based support network.
Johnson Controls will display production vehicles at the Grand Prix featuring AutoLink, Steiner said. The race is attracting more automotive companies, Broadwell said, such as first-time Grand Prix sponsor SAP America Inc., a supplier of computer software.
'We're definitely using it as a market awareness event,' said Michael Morris, industry segment manager for SAP America's new automotive strategic business unit in Southfield, Mich.
Another computer-related company, Sun Microsystems Inc., has been involved with the Grand Prix for four years and is an associate sponsor of the Penske CART racing team. The Penske team uses Sun Microsystems computer network systems, according to Broadwell. '(Sun's) key buyers can come down to the race and see Sun's technology in action,' he said.
For Recaro, participation in the Grand Prix is part of its strategy to win at least five original equipment contracts in North America by 2000, Pinto said. In addition to its seats in the Johnson Controls cars, Recaro will hype its new ArtLine one-piece seat cover systems at the Grand Prix. ArtLine eliminates cutting and sewing, Pinto said.