Silverstone nonplussed with Circuit of Wales cash request

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Have you been keeping an eye on the proposed new Circuit of Wales near Ebbw Vale? Well Silverstone certainly has and they’re nonplussed about the recent developments there including a request to the UK and Welsh governments for investment capital to underwrite the project.

According to the BBC, circuit developers have asked for £30m from the Welsh government and an additional £20m from the UK government. The Blaenau Gwent council is backing the plan and says they are comfortable with the business plan but Silverstone is not excited about the proposition and has offered an official statement:

“Silverstone is fully supportive of regeneration projects and the creation of new jobs, however, when Silverstone Circuit was recently looking for support to secure the future of the Formula 1 British Grand Prix and protect Motorsport Valley – a cluster of motor sport, automotive and high performance engineering businesses at the heart of the motor sport industry sector, comprising 4,300 companies, employing 41,000 people and generating annual sales of £9 billion – the application was denied on the basis that this would be classed as illegal State aid. In the absence of such aid, Silverstone had to sell off assets to ensure the Formula 1 British Grand Prix was retained in the UK.

Silverstone has been advised that an injection of funds by the Welsh and/or UK governments to the Circuit of Wales project could also amount to illegal State aid, as a transfer of State resources would give Circuit of Wales an economic and selective advantage over other circuits (and developments). There are currently a number of well established, privately funded circuits in the UK, including Wales, that feel that the British motor sport industry would be threatened by the addition of a government funded circuit.

To be clear, Silverstone has no objection to competition between UK circuits, but it has to be a level playing field.

Based on its unrivalled knowledge and experience of running an international motor racing venue for over 60 years, it is Silverstone’s view that the Circuit of Wales project is unviable. In 2008, UK motor sport experienced a similar scenario, when a previous management team at Donington Park circuit underestimated the financial realities of hosting Formula 1. A proposed major upgrade failed to materialise due to unrealistic projections and a consequent lack of investment.”

There is no doubt that Silverstone would have enjoyed any investment from the UK government when it was trying to renovate the circuit and secure a long-term extension of their Formula 1 contract back in 2010. One thing that has always made British, as well as American, grands prix challenging is the lack of government funding that so many other circuits enjoy in AsiaPac and elsewhere.

The race in Austin Texas was eventually funded in part by a Major Events Trust fund the State has for such events but Silverstone has enjoyed no such investments.

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