British GP at risk; Ecclestone says stop complaining

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The BRDC has suggested it may stop its Formula 1 hosting at Silverstone as the deal is ‘Potentially ruinous’ to their financial situation. The BRDC signed a multi-year deal in 2009 but could stop hosting after the 2019 season.

This has left F1 boss Bernie Ecclestone slightly confused as to the complaints from the BRDC.

‘I don’t see why they can’t make it work. They get bigger crowds than anywhere else in Europe, and nobody else is complaining.’

He does have a point in that the British Grand Prix is the largest attended race in Europe and it is unfortunate that the race promoters cannot profit from that level of support. As an example of how a good circuit can host a good race with good fan turnout and support, it’s unfortunate that it is being deemed potentially ruinous.

The British Racing Drivers’ Club chairman, John Grant, called it potentially ruinous but he has a point in that the fees for hosting the race include a 5% escalator per year which increase the expense from £12million in 2010 to £26m by 2027. Even if the race were slightly profitable or break even in 2009, can the BRDC count on a 5% growth pattern in attendance and what lingering revenue stream Formula One Management leaves them over the race weekend?

The 1996 F1 champion, Damon Hill, has renewed calls for state support as he feels the series put the UK’s best foot forward and in many ways I agree with him. While the US wouldn’t be willing to foot the bill for the USGP in Austin, the state of Texas has helped and without it, the USGP may not be an event at all. Would the US government back the USGP? Most likely not but then again, the US isn’t the hub of international motorsport like the UK is with its version of Silicon valley for motorsports. Perhaps the UK would find that worthy of support as it employs thousands of people.

It’s a global sport that lands in nations for a national event. In some ways, the global and nationalism that permeates F1 does lend itself to government support but since 2008, the sport has seemingly avoided any austerity moves on a massive scale and one wonders just how long the business model can seek £26m per year.

Hat Tip: Daily Mail

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Tom Firth
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Tom Firth

I understand that the economies don’t work for Silverstone but the constant threats of pulling the Grand Prix grow tiresome after a while, and become empty threats. Silverstone knows the UK doesn’t have a realistic alternative venue, Bernie knows this and the game goes on. If the BRDC is serious, it would pull the plug. Personally I think they want a better deal from Liberty and are using the age old reason of well the government doesn’t support us, so we’ll pull out, to get that. The Westminster Government for all of its many flaws, may not support the grand… Read more »

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I think the BRDC is just hedging its bet on F1 with Liberty Media than Bernie. And if that means there’s no UKGP for a year or two, so be it. Like Malaysia and Singapore, the cost of hosting and promoting a national F1 race with Bernie and CVC is too much a financial risk and little reward. I wonder which will be priority #1 with Liberty Media: the teams, the tracks or the fans?

T-Batwoman
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T-Batwoman

I’m typically against any state sponsored sporting events, from subsidizing sports stadiums to hosting motorsport. Yeah, yeah, yeah, I get it, it helps the local economy, at the cost of everyone in the state. It’s not right to take money out of someone’s pocket to subsidize a stadium/race for a billionaire.

If a sport can’t support it’s own weight it should go the way of the dodo just like any other failed business.

jakobusvdl
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jakobusvdl

Hi T-bat, as far as I understand it F1 is a very profitable sport for the commercial rights holders (the previous owners CVC, were pulling hundreds of millions out of F1 every year), but the distribution of the profits is primarily to those rights holders (and Bernie, plus the FIA) and not to the circuits. Unfortunately for the likes of Silverstone and Hockenheim Bernie wants the same return for the privilege of staging an F1 event as he wants from the countries where the governments are preparded to subsidise the event. Hopefully the new commercial rights holders, Liberty group, are… Read more »