The annual Geneva auto show was plunged into crisis in March when a late decision by Swiss authorities to prevent the spread of coronavirus forced the cancellation of the 90th event.
The show's organizers, the Geneva International Motor Show (GIMS) Foundation, initially refused to pay back stand fees to exhibitors, generating anger among automakers that had already questioned whether the expense of traditional auto shows was worth the publicity they generated.
Stepping into this crisis is GIMS' new director general, Sandro Mesquita, who took up the role on May 1 having previously run Switzerland's arm of advertising company Publicis.
One of his first moves in the job was to reject a bailout loan worth a 16.8 million-franc ($17.3 million) from local Geneva State authority that would have partly been used to reimburse the automakers and organize next year's event.
In his first interview since joining GIMS, Mesquita explained why he rejected the loan and how he plans to resurrect the show's fortunes, including possibly cutting automaker costs and even changing the show to a bi-annual event.
One of your first decisions as director general was to turn down a bailout loan from Geneva State. Why?
There are two conditions that are an issue for us. The first one is that full delegation of the organization of GIMS goes to Palexpo [exhibition center], including the conceptualization of the show. This is not acceptable for the GIMS Foundation.
Palexpo already has a big hand in the organization in the show. What would change?
The major change would be that they would decide not just the operational parts but also the concept and strategy. That's a major problem for us because that's our work.
What was the second condition that you didn't like?
They linked the loan to holding a show next year. We haven't decided whether we should organize a show next year, but the signals we are receiving from the brands are more in the direction of 2022, because of the crisis they are facing. The whole industry is facing a huge [financial] challenge with the COVID crisis and also the situation regarding the coronavirus in the next months is still not clear.
For us it's a big risk, because we cannot have a second disaster. It would not be possible for us to face another loss. For the moment we are thinking of organizing the next event in two years' time."
Geneva State says it's linked the loan to holding a show next year because Geneva itself is so reliant on the income it brings. I guess you would say that was short-sighted.
We are not looking it from the same angle. We are looking to save the GIMS and my impression is that the State's view is it's more short term linked to employment etc. I understand that. But if we have a cancellation next year again it would just be a catastrophe for us, so we need to take into account what the brands are saying, because without the brands there would not be a show.
Part of the loan was to reimburse the manufacturers. If they were reimbursed, might they think about taking a stand in 2021?
This is not the feedback we received. We ask already some major brands if they would be interested in taking part next year and while they didn't clearly say no, they gave a signal it was their tendency not to. It was not directly linked to reimbursement of the costs.
In March GIMS Foundation chairman said GIMS wasn't required to pay back stand fees to manufacturers. Why have you changed your mind?
Legally we are not liable, but this is not our intention, our intention is to reimburse and find the financial means to do it.
Don't you need the loan then from the Geneva State to reimburse?
The Geneva State loan is was first option that the Foundation activated before I joined. Since I arrived May 1, I am looking for other alternatives, so I'm in contact with financial institutions and some investors. The state loan is not the only option. We are still on contact with the Swiss Confederation, so this is another option.