Quo vadis Formula One?
REALITY: REPORTS SHOW THAT SILVERSTONE NEEDS FUNDING FROM LIBERTY TO COVER COSTS
Chase Carey has proposed 5 July to start the season.
In recent weeks we have had plenty of time to consider the future of Formula One. Over its 70-year history, the sport has grown and experienced many changes, becoming – through the auspices of one Bernard Charles Ecclestone – a well organised and financially secure business.
Ownership changed in 2006 when the company was sold to CVC Capital Partners who retained Ecclestone as the man in charge, but in 2017 the company changed hands once more.
Purchased for a staggering $8 billion, new owner Liberty Media set about condemning F1’s previous modus operandi, while promising a bigger and brighter future for the sport.
Initially appointing Ecclestone as “Chairman Emeritus”, it was not long before he was ousted and the American team, headed by Chase Carey, took over totally.
Announcements were made about proposed new tracks and global expansion, an increased number of races, new teams waiting to join, exciting new digital services and a streaming television service.
Unfortunately, most of these goals have yet to be realised.
Most of the new circuits are in Eastern countries, sometimes to the detriment of existing tracks in Europe.
No new competitors have reached the grid and F1’s digital television and apps have been plagued with technical issues.
Conventional TV broadcasts are in the hands of one company and are now behind a pay wall, resulting in a drop in viewership.
What we have seen is a significant decrease in the financial value of the F1 group. This is likely to continue in the coming months.
The coronavirus pandemic has already led to the postponement and cancellation of many races and is progressively depleting the possibility of a 2020 F1 season.
Last week Carey proposed a start to the season at the Austrian Grand Prix on 5 July – music to everyone’s ears.
Perhaps Liberty is on course to honour their statement of two weeks ago, saying they are “committed to bringing fans a championship season.”
Red Bull are apparently preparing back-to-back races at the Spielberg circuit and Silverstone are keen to get in on the action.
Admirable efforts from both but can any of the current tracks institute all the necessary aspects of organising and running a Grand Prix on such short notice?
It will require massive financial backing to cover all the costs involved.
Most of the European rounds are scheduled to be run without spectators, the only source of income for the circuits.
Recent reports indicate that Silverstone requires financial backing from Liberty to ensure all the expenses can be met. They will probably not be the only track requiring such assistance.
There has always been little profit in hosting a round of the championship as F1 take the television broadcast revenue, plus trackside advertising and the income from hospitality facilities.
But the most im- p o r - tant factor is the incredible number of personnel required to run a round of the championship.
It is estimated that the British Grand Prix requires 2 000 plus to meet all requirements and a large percentage of that number will be the marshals.
Apparently British marshals are volunteers and have always paid their own expenses such as accommodation, travel, catering and personal equipment and this is where the difficulties begin. Whether they can be available on the dates proposed is another problem. These dates could change due to government policies, so booking leave from their employers becomes almost impossible.
Many will have become unemployed or retrenched due to the lockdowns, or if self-employed have been unable to earn an income for months. In such cases the organisers would have to reimburse all officials for transport, food and accommodation. But remember they will have no income as the event will have no spectators.
Will F1 be able to provide the financial backing? Likewise, there is the issue of the mandatory medical team, without whom the race cannot be run. This is not just a matter of finance, but also of availability, as most medical personnel are involved in fighting the pandemic.
On top of these expenditures, organisers and circuits have contracts with suppliers of transportation, local authorities and police traffic control departments, and these have to be booked well in advance. With the current flexibility of the calendar booking an exact date is impossible and if the event cannot take place there is the spectre of cancellation fees.
Let us not forget the organisers have to pay a hosting fee to F1. Even if reduced, can they survive?
I have only featured some of the immense difficulties facing all involved to ensure the smooth and safe running of a Grand Prix and wonder whether an 18-race season is even possible.
Perhaps Carey and his team should consider reducing the number to 10. Only eight are required for a championship and it would lessen the enormous pressure on everyone.
Can the sport’s owners afford to back every race?
The recent transfer of $1.4 billion within the Liberty Group provides funding for F1 but it is likely to be consumed very rapidly if the pandemic continues unabated.