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Under Swadeshi pressure, Vivo pulls out of IPL title sponsorship

BusinessToday.In     August 4, 2020

Chinese smartphone maker Vivo has decided to exit the Indian Premier League (IPL) as the title sponsor for this year's edition of the T-20 cricket tournament. The company faced severe backlash on social media after the Board of Control for Cricket in India (BCCI) announced on Sunday that it will retain all its sponsors, including Vivo even as voices against Chinese brands continued to rise. Sentiments towards China and companies based in the country have grown averse in the wake of clashes between Indian and Chinese troops in Galwan valley back in May.

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Vivo had signed a five-year deal worth Rs 2,199 crore to become the title sponsor of IPL in 2017, paying almost Rs 440 crore to the BCCI every year. It had replaced PepsiCo, which had walked out of a Rs 396 crore deal in 2016. With three years left on its contract, Vivo will now be the title sponsor for IPL in 2021-2023. Vivo had reportedly asked for a Rs 130 crore cut in its payout to BCCI on account of poor sales and worsening sentiments against Chinese companies.

With its exit, BCCI now has a tough task of finding a new title sponsor on its hands on a short notice in a market ravaged by the coronavirus pandemic. The BCCI had announced last week that the IPL 2020 will be played from September 19 to November 10. The latest development has also raised compensation worries for the franchises.

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Earlier reports had suggested that an IPL franchise had called up other franchises to inform them about Vivo's plans to step down as the tournament's title sponsor for this year. BCCI was upset about over one of the franchises taking it upon itself to tell other franchises about Vivo's exit while the matter was under discussion.

On Sunday, an IPL Governing Council member had told news agency PTI that all sponsors, including Chinese companies, have been retained. "All I can say is that all our sponsors are with us. Hopefully you can read between the lines," the member had said.

This was followed by a massive social media backlash against BCCI's decision to continue with Vivo as the IPL title sponsor. This reaction came on the back of clashes between Indian and Chinese forces in eastern Ladakh that led to death of 20 Indian soldiers.

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