SEMA 2020 – Why It Was Canceled and Reactions from the Industry

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As reported last week, the 2020 SEMA Show was officially canceled with people wondering why. Here is what SEMA and several industry insiders had to say.

On Monday, August 3rd, 2020, SEMA reported to me that the 2020 SEMA Show was fully on schedule but there were contingencies in place in case something changed. In less than 48 hours after that article, SEMA announced that the 2020 show was canceled, citing “mounting uncertainty” that “event facilities and services will be unavailable.” What changed? Today (August 10, 2020), I once again speak to SEMA Vice President of Events, Tom Gattuso, the Las Vegas Convention and Visitors Authority (LVCVA), and several insiders for answers and reactions.

What Happened?

Image: David Calvert of the Nevada Independent
As mentioned above, SEMA stated that there was a concern that facilities and services would not be provided for the 2020 SEMA Show if it were to take place in November as scheduled. When speaking to Mr. Gattuso and the LVCVA last week, both were confident a show could take place but that quickly changed with a late afternoon press conference on Monday, August 3rd, 2020 by the Governor of Nevada, Steve Sisolak.

“I want to be clear,” stated Mr. Sisolak in the conference, “in no way are we relaxing our mitigation efforts… (Until) the first assessment takes place and action plans are finalized between the counties and the task force the current restrictions… will remain in place for the four counties previously identified as meeting increased transmission risk criteria.” Clark County, which the city of Las Vegas is a part of, is one of the four counties under those restrictions.

Due to that conference, SEMA came to only one conclusion: the 2020 SEMA Show must be canceled. “The Governor’s press conference on Monday and the new guidelines he proposed did not show us a clear path to the event taking place,” said Tom Gattuso, VP of Events at SEMA, “We remained confident that we would be able to host the event successfully and the industry continued to support and sign up to attend, but rather than wait and hope that we would be able to host the show, we decided that it was in the best interest of all those involved to make the difficult decision.”

When I reached out to the LVCVA, Steven Hill, their president and CEO, had this to say, “We are grateful for our 40-year plus relationship with SEMA and certainly understand and respect their difficult decision to cancel their in-person show. We appreciate SEMA’s ongoing commitment to Las Vegas and while we’ll greatly miss hosting their exhibitors and attendees, we look forward to welcoming them back to the destination in 2021.”

What Happens Now?

Image: SEMA Media
I asked Mr. Gattuso what SEMA was planning in place of the 2020 show, but they aren’t committing to anything in particular at the time of publication. “It is too early to conclude,” he stated, “We have been researching virtual alternatives for months and know there is interest from the industry, but we want to make sure, in light of our recent announcement, that we understand exactly what the marketplace demands. Ultimately, SEMA’s mission is to help its members succeed and prosper. That’s something we take seriously and continue to focus on.”

What does this mean for SEMA’s other big show, the Performance Racing Industry (PRI) Show in Indianapolis on December 10th to 12th, 2020? That show remains on schedule to this point, “The PRI Trade Show remains on track and the SEMA Show status does not in any way affect the 2020 PRI Show,” said Mr. Gattuso, “The pandemic has impacted each state in the country very differently and Indiana is in a much better position for hosting the PRI Trade Show in December.”

I asked the insiders again on their thoughts of a virtual show and, as they indicated last week, a virtual show might not be in their interests. “A virtual show isn’t going to work,” said one of my insiders, “how long would it take to cover 2600 exhibitors? That would cost a lot of money, too, and probably wouldn’t be as successful as many think it would be.” Mr. Wynn, who is in favor of a virtual show, stated, “I have no expectations for SEMA to do anything in place of the show this year. The show in 2021 will have a lot of hype and will be highly anticipated.”

What About Next Year?

That seems to be the consensus of those I spoke to. The show in 2021 is going to be so hyped up, maybe not doing anything at all to replace it is best and promoting next year’s show would be better. Even SEMA seems to see a far bigger show for 2021, as Mr. Gattuso told me, “Next year the construction at the convention center will be complete and we are excited to explore the opportunities with that new space, and what it can mean to our event.” Unless you’ve been to the Las Vegas Convention Center within the previous year, you probably don’t know that it is expanding. The original “Gold Lot” parking area has been turned into the West Hall and that construction was the reason for the move of SEMA Ignited to the “Platinum Lot” in 2018.

The Automotive Aftermarket Reacts and Now Adds 2020 PRI Show Concerns

Image: SEMA Media
Prior to the announcement, many in the automotive aftermarket industry felt that the show should have been canceled earlier. Those thoughts morphed into justification once SEMA made the official call as one leader in the industry, who wished to remain anonymous, stated, “I believe SEMA actually did the industry a disservice by continuing to ‘try’ and have a show and continuously tell the industry ‘the show must go on.’”

Their biggest reason on why they felt that way? The total cost of the show for businesses that exhibit. “I marginally understand – and can even sympathize with – their position because it is an awful thing to accept but keeping this going for so long has unintentionally caused financial damage to many companies.” The insider noted that it wasn’t just exhibit space rental that costs money but also the booth and display construction, as well. “Typically,” said this insider, “this is a progressive process with progress payments made along the way. There are many businesses that have paid up to fifty-percent of their booth costs by now and that cost is likely non-refundable.”

Then you add in items like giveaway items, marketing materials, and other things made just for the 2020 show. “Those marketing items will most likely be irrelevant in 2021,” my insider stated, “They also need to cancel the PRI Show as soon as possible. The risk, liability, and very real possibility that federal, state, and local governments won’t even allow it to happen – just as what happened to the SEMA Show – are all of the reasons required to justify canceling it. Doing so now will stop further unnecessary spending on something that has little chance of being possible.”

I reached out to Reginald Wynn, sales and marketing manager at Turbonetics, and asked for his own reaction after the news. Again, he notes that these are his opinions and not those of Turbonetics or Wabtec Corporation, “I’m sure it wasn’t an easy decision by SEMA, however I feel they ultimately made the correct one.” When I asked him about PRI, he also felt it needs to be held off until 2021, “The PRI Show is only four to five weeks after SEMA, so, in my mind, those two shows are so close to each other that PRI should have the same fate.”

An automotive marketing specialist, who has helped design and concept many vehicles for shows like SEMA, reached out to me anonymously as well. When I asked about their thoughts, it echoed what I had seen to this point: it is for the best even it wasn’t in the best interest for SEMA. “So many businesses spent money and did things they can’t get back,” they stated. They also feel the same about the PRI Show stating, “I absolutely see it being canceled and see the same push with the same result. ‘The show must go on’ will apply and then we will get the late cancellation notice – just like SEMA.”

Frank Schwartz of Advanced Automotive Consulting Services thinks that SEMA did the right thing in both canceling and waiting for as long as possible and PRI should take in similar considerations, “I feel SEMA’s timing was about right – they waited for as long as possible to cancel. SEMA should look at the same issues for the PRI Show but as a substantially smaller show with less international travel and in an area that is more remote.” However, Mr. Schwartz thinks that PRI might still have their 2020 show, “I think they have a better chance at holding a successful event. In fact, it could be a fantastic opportunity to test new processes and procedures on a more manageable scale.”

There are many who are just as sympathetic to what SEMA had to do. Honda Public Relations for the Western US, Carl Pulley, stated, “American Honda has participated in the SEMA show for many years as it is a great opportunity for us to showcase our vehicles and Genuine Honda Accessories and to connect with the specialty equipment and customizing community who also serve Honda enthusiasts. As unfortunate as it is to all in the community, we understand the situation that prompted the event organizers to cancel this year’s show.”

Is SEMA and the SEMA Show Still Relevant?

Image: SEMA Media
Even with the cancellation of the 2020 show and more moves to digital and social media marketing, most of my insiders still feel that SEMA and its trade show are still needed in the industry. Most of that feeling comes down to warm, human interaction over a cold, virtual one.

My marketing insider stated, “I think SEMA does have a lot of beneficial things to offer the industry, but a substantial portion of members don’t know about them or even how to use them if they do.” Mr. Wynn feels the same way but adds, “I think this is the perfect opportunity for them to reinvent themselves. Our world is ever changing, and things are going more digital.”

Mr. Gattuso certainly feels that SEMA and its trade show are. “Nothing will ever replace the value and importance of a live, business-to-business trade show,” he stated, “Our industry relies on the ability to gather and connect, showcase and demonstrate products, and see what’s new. As mentioned earlier, it is SEMA’s mission to help its members succeed. That is the sole focus and purpose of the association and we remain committed to doing so. In that respect, (canceling the show was) difficult and perhaps the most difficult thing that we have ever had to do.”

Is The Industry Slowing Down and Did That Also Lead to Cancellation?

It is an interesting thing to realize that people are still spending money when they have it. Mr. Schwartz notes that many people have money to spend, despite how unemployment is so high. “The economy has three types of people: those with enough money that they can make decisions independent of the economy, those with so little money the economy is a foreign concept to them, and those in the middle. The middle group, from what I have seen, have been comfortable thru this pandemic.”

“In fact,” Mr. Schwartz continued, “while many have had pay cuts, they have also had cuts to their discretionary spending because vacations have not been possible, eating out has been difficult, etc. Those people have been looking for ways to spend their money.” Even Mr. Wynn has seen an increase in spending from his customers, “We have been busier during this time than in previous years.”

Even with everything they have seen go on in 2020, my marketing insider has seen it, too. “We have seen an increase of aftermarket accessory sales,” they stated, “Because of that, I think future SEMA funds will be reallocated and it may affect SEMA and the show going forward.” That was the dire warning that Mr. Schwartz alluded to in the previous article.

What Should the Industry Do Now?

Image: SEMA Media
Speaking to the insiders who reached out to me and I reached out to as well, I asked what the industry and SEMA should do to make up for the loss of the 2020 SEMA Show. Mr. Wynn feels that your 2020 SEMA budget – if you have anything to spend at this point – should go into new marketing campaigns, right now. “This is the perfect time to put your efforts into social media and other digital avenues,” he said, “SEMA shouldn’t be your only channel to get the word out about your company or to release new product information.”

My other marketing insider added, “Take this time to evaluate your role in the industry. Everyone must realize this is one show and there are many others. Take this time to rest and plan for 2021, plan for ways to not skip a beat, and make next year a success.” They mention with a laugh, “It also means there are no excuses for the ‘SEMA crunch’ next year.”

Mr. Schwartz, though, thinks this is the time for both SEMA and the industry to take a closer, critical look at the show. “SEMA has gotten too big,” he said, “I try this test after every major convention: I ask people to describe their top three things they saw. The amount of times people can correctly identify the brand or booth they saw them in is amazing as it is not that high of a percentage.” He believes that it should be broken down into several smaller shows rather than a huge one.

He also notes that the industry should also take the time to find ways to strengthen existing relationships and find new ones despite the show’s cancellation. “This area is ripe for a new idea,” Mr. Schwartz says, “While I wish I could come up with it, someone will crack that nut and then we will all sit back and say ‘brilliant.’”

What Everyone Agrees On: Bring On 2021

Image: SEMA Media
If there is anything that everyone says that I have talked to, it is that they look forward to next year. 2020 has been a rough ride for some people. This year just can’t end quick enough for some and 2021 brings them hope. SEMA has also seen that from their own members reactions, comments, and even the association’s 57-year history (SEMA was founded in 1963 while the first official SEMA Show was 1967). “SEMA and the aftermarket industry have a deep history of innovation, perseverance, and commitment,” says Mr. Gattuso, “I can’t say what it will be, but I am confident that 2021 will bring greater excitement and value to the industry.”

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Image: SEMA Media
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