Published On: Sat, Jan 18th, 2014

Manchester United Starting $559 Million 7 Year Global Jersey Sponsorship With Chevrolet

Deal agreed in 2012 now commencing even though Chevrolet now pulling out of European market

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In July of 2012 General Motors company (NYSE: GM) and the English Manchester United Football Club announced a sponsorship deal whereby Chevrolet would become the official jersey sponsor of the club from 2014 on. Manchester United is controlled by the Glazer family of the United States, and is a storied, championship winning, leading member of the English Premier Football League.

As such Chevrolet became only the fifth such jersey sponsor in the 135 year history of the club, which was founded originally in 1878. Under the terms of the deal General Motors are to pay Manchester United US$559 million over seven years for the privilege.

Many people questioned this at the time as being hugely expensive. In the exalted world of sports sponsorship though it may not necessarily be disproportionate, given Manchester United’s proven global appeal for television audiences. This is in itself remarkable for an English football club, or soccer for our North American readers, albeit one in the Premier League with a long history of winning championships.

Things got a bit more complex however in 2012 just after that deal was announced, when General Motors summarily fired their global marketing chief, Joel Ewanick. Nobody seems quite sure why, though perhaps being a little bit administratively lax while tying up some of the loose ends of the Manchester United deal have certainly been rumoured to be part of it.
Then just last month General Motors reshuffled their entire management deck, with the retirement of Dan Akerson as its Chairman and also the appointment of Mary Barr as the first female CEO in their corporate history. She is now just taking up her new appointment this month in fact.

As part of that reshuffle the American Government sold off their last remaining shares in the company, that had been awarded to them when they bailed the company out of bankruptcy during the financial crisis. Then last month also, lo and behold, Chevrolet made the sudden announcement it was going to stop selling cars in the European market completely in favour of its sister divisions Opel and Vauxhall, both of which have longstanding roots in Germany and the United Kingdom.

With the exception of the Chevrolet Corvette, which will continues to be sold there, it seems Chevrolet branded products have not been to the taste of European buyers, being mostly on the cheap and cheerful side and, even worse these days for the Europeans, with many of their smaller products sourced from General Motors factories in South Korea.

So what good is such a huge sponsorship deal with Manchester United if you are not selling any Chevrolet cars in Europe any more, and especially when the club seems to have lost its winning ways recently in the aftermath of Sir Alex Ferguson’s retirement as Manager of the club?

Well if they were starting over I am sure General Motors probably wouldn’t have done it, or at least not at the same price they agreed to. However there remain some significant advantages for them, so it can still work out. Manchester United has over 650 million followers around the world, only 15% of whom actually live anywhere in Europe. China, the rest of Asia and the Middle East are all major markets for the club’s brand, and for its television footprint for broadcasting rights to major matches.

Outside of Europe General Motors has been largely successful in developing Chevrolet as a global brand. Many of its cars now are developed in South Korea and China as well as in the United States. In China, and other Asian markets it sells huge numbers of cars.

So for Manchester United it is now all systems go for the branding deal and their staff are not startled at all, in public at least, by General Motors’ decision to bring down the axe on Chevrolet as a brand in Europe.

“Chevrolet are very clear that the partnership with us is a global one and we both intend to continue this partnership to help build their brand around the world, ” club spokesman Phil Townsend said.

Kicking off the new partnership Alan Batey, General Motors’ North America Vice President, U.S. Sales and Service said: “We are extremely proud to connect our brand, Chevrolet, with Manchester United and its passionate supporters all around the world. Manchester United’s statistics are impressive, but this relationship goes far beyond the numbers – this relationship is about connecting our brand with the deep-seated emotion that surrounds the team everywhere it goes.”

I’m a Manchester United fan from way back, and even here in the Middle East I will be quite happy to see the Chevrolet name plastered all over their shirts now. Heck I once even used to own a Chevrolet too myself a very long time ago. It was a beautiful red Camaro, and was in many ways the perfect car for its time with its small block V8 engine.

 

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