Fired Ewanick's Soccer Deal Backfires: Manchester United Fans Boycott Chevy

by Bertel Schmitt

August 3rd, 2012 2:04 PM

fired ewanick s soccer deal backfires manchester united fans boycott chevy

Devotees of the Manchester United soccer club call for a boycott of the products made by the club’s sponsors. This famously includes Chevrolet. Last Monday, GM signed a seven year contract with Manchester United. A day before, GM’s Chief Marketing Executive Joel Ewanick, the architect of the deal, was fired. Manchester United supporters are opposed to their club going public on Wall Street. To put pressure on the Glazer family to ditch the plan, they ask the public to stay clear of the products of the club’s sponsors.

According to Reuters, “the call risks embarrassing the club just days after it signed a record-breaking shirt sponsorship deal with U.S. auto company General Motors.” According to TTAC, this can’t be good for Chevrolet and the people responsible for the deal.

The Manchester United Supporters Trust (MUST) accused the Glazers of hurting the team’s performance by saddling it with debt in a $1.23 billion takeover in 2005. MUST has around 180,000 members.

#BertelSchmitt #Boycott #Chevrolet #Ewanick #GM #Manchester

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9 of 34 comments

Beerboy12 on Aug 03, 2012

It's all about the TV coverage and marketing mileage from having logo visibility and GM will get plenty of that.

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Sailorman on Aug 03, 2012

This boycott call is unlikely to have much impact in my opinion - so I dare say that Chevvy can sleep easy. However, some of the comments here are more than a little over-the-top. So lets give some background: Manchester United did not garner the largest group of supporters for any sport club in the world by confining themselves to any particular socio-economic group / geographic area. While the specific group proposing the boycott call is small - their concern about the current set-up has broader support. I understood the specific concern re the share issue was the owners plan to take 50% of the proceeds out of the company. This will still leave substantial debts on the club's books (which arose from the way the owners financed their original take-over). The interest on these debts (which their competitors do not bear as their owners have financed the club by inserting equity rather than debt) is perceived to curtail the ability of the club to compete in the acquisition of world-class players.

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- Mike978 on Aug 03, 2012
  
  You are right. I can recall when the Glazers firs bought Man Utd and then quickly paid themselves back by loading the company with debt that there was outrage. I would hope Man Utd fans would realise that the club needs sponsor to help finance the club, without the sponsors the club wouldn`t be able to acquire world-class players. So they are right to complain about the Glazers but all sponser are required.
  
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- Sailorman on Aug 04, 2012
  
  @mike978 Mike 978 I think we are aligned. As an old guy I think that soccer has moved a long way from its 'supporter-based' roots - it is now big business with all that implies (including the need for sponsors). With the world-wide fan base Man U has, it can generate enough revenue to compete with any club, even those with 'sugar-daddy' owners. However, far from being a'sugar-daddy', the Glazers are not even regarded as 'benign' owners - they have placed a major drain on the club's finances, which means that a substantial portion of the revenues are not available to promote the quality of the soccer being played on the pitch. Certain supporters see the Glazer model as unnecessarily risky to the long term health of the club, and want them to change course. The challenge is how to put pressure on them? - one way is to try to hit them in their pocket book (which seems to be what motivates them - rather than a 'love' for Man U that the supporters have) - presumably the call for a boycott is an extension of that idea. A more idealised approach has been to set up a new club operating on 'supporter-based' principles. The result is FC United of Manchester - who had to start at the very bottom of the league structure in England and have already won three promotions. Five more promotions and they reach the Premier division (where Man U competes). If you support the underdog, look up the club here http://www.fc-utd.co.uk/
  
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Alluster on Aug 03, 2012

"Last Monday, GM signed a seven year contract with Manchester United." A seven year deal? Too optimistic on Chevy's part to think will be around for that long. That's 5 more years than how long I expect them to be around.

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- Oboylepr on Aug 03, 2012
  
  Any chance you might share your reasons for saying that?
  
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- Felix on Aug 03, 2012
  
  Man-U or Chevy?
  
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Ranwhenparked on Aug 04, 2012

So, its a bunch of people campaigning to get a "voice" in a business they don't own, and evidently have no intention of ever owning. Why doesn't MUST just pool their cash and buy into the IPO? Seems that would do more good than boycotting a car brand that their country doesn't even really buy anyway. $5,000 a piece would get them over 27% of the team, which would probably be enough to force a board seat.

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- Domestic Hearse on Aug 05, 2012
  
  @ranwhenparked, MUST won't get invited to the seat of an IPO because of the institutional nature of IPOs. The shares are sold by the corporation to a huge investment bank or firm. They, in turn, orchestrate the offering of those shares via the stock market to other big institutions in large percentages. Small potatoes investors, like the members of MUST, never get invited to the table. Super high net worth individuals may be given an opportunity, as might executives in the IPO-offering company. Remember FB going public? Outside the executives, every buyer of FB IPO shares were master-of-the-universe, too-big-to-fail type organizations. As for us individual investors, that was a good thing as even can't-miss IPOs like FB can and do take an Initial Public Cratering. Now, as executives at FB and disappointed institutions dump depreciating FB shares, the public can buy in at a discount. (However, if you look in your 401k fund, don't be surprised to learn you already indirectly own FB in some capacity). Look for ManU shares (down the road a ways) to be like "ownership" of the Green Bay Packers. Big fans will eventually find a way to buy their personal, single share which they will keep forever, passing it down father-to-son. It's a financial purchase based solely on emotion, owned strictly out of loyalty, and has nothing to do with earnings. If the Glazers pull this off, it'll be a crafty piece of high finance, given the huge world-wide fanbase of this club.
  
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