It is no FISA-FOCA war but there appears to be a growing battle of wills in Formula 1 between the FIA on one side and Liberty Media and the F1 teams on the other. This week I bring some examples of the brewing conflict.
I also bring you the latest F1 team valuations, inside a consortium trying to land a team in F1, the battles of an American privateer sports car team in Europe and the evolution of the racing helmet as a marketing tool.
All this plus the latest motorsport deals and partnerships, the evolution of sports sponsorships and the latest comings and goings of those involved in making motorsport happen.
All this and more in this week’s Business of Motorsport Roundup on Motorsport Prospects. Its business news racers can use.
Motorsport Industry News
Formula 1’s ten teams are worth $1.88 billion on average, according to Forbes estimates, a 276% increase from the $500 million average when Forbes last valued the series’ teams in 2019 (using 2018 revenue figures). Ferrari, which is synonymous with Formula 1, came out on top, at $3.9 billion—a 189% jump from 2019—with Mercedes close behind at $3.8 billion.
While I am sure the current values of F1 teams is not the primary reason, Michael Andretti still wants to be on the F1 grid and the rumor mill is saying that he is most likely going to get the nod, perhaps as a way for FIA President Mohammed Ben Sulayem to show Liberty Media who’s boss. Keeping up his objections to a new team, Ferrari boss Frédéric Vasseur is of the opinion that F1 shouldn’t accept a team just because they come from the United States. And the soap opera plays on.
The Race goes inside a long-shot 2026 Formula 1 team bid as they chronicle the attempts of LKY SUNZ to get on the F1 grid. “F1 hopeful LKY SUNZ believes it has the answer to that. It promises a unique way of operating – “basically hip hop is our template in the way that the team will act” – but the main selling point it’s focusing on in its F1 bid is a promise to expand the championship’s commercial reach to new audiences.”
Putting aside their common aim to prevent anybody from joining the F1 grid, Formula 1 teams have been urged to change mindsets and work together more off track if the championship is to maintain its growth trajectory, says CEO Stefano Domenicali. “When we are on track it is right that each team gives everything to impose themselves on their opponents, but there is also a moment when we need to come together and think about the good of the sport – a good that then benefits everyone.”
With all the talk of conflict between F1, the teams and the FIA, the international sanctioning body has had to remind everyone who is in charge when it comes to F1 reforms. “The FIA stresses that while it welcomes opinions from stakeholders, the regulatory powers over all FIA championships – including the FIA Formula 1 world championship – are vested in the FIA. Any technical, sporting or financial sanctions and/or amendments to such regulations will follow due process.”
Wondering how the FIA governs the cost cap in Formula 1? Well wonder no longer as they explain all on the FIA website. “The process works like this: in advance of the full submission, there is an interim submission that is mandated for the 30th of June of the season then in progress, so for the 2022 season, teams would have sent us their interim submission in June of last year and the full submission on March 31 this year. The interim submission is really just to allow teams to understand where they are in their projected spending, and for us to try to anticipate any discussion that may take place as a result. So there is a little bit of preparatory work that is done before the full data is submitted.”
Autosport reports that Alpine CEO Laurent Rossi, who held overarching responsibility for the Renault Group’s Formula 1 team, has been moved aside. Former Alfa Romeo technical director and Ferrari engineering boss Philippe Krief, who joined Alpine in early March, has been appointed as Rossi’s successor. He will continue in his role as vice president of engineering and product performance until further notice and report to Renault Group CEO Luca de Meo.
One of the more interesting statements from F1 CEO Stefano Domenicali (amongst many these days it seems) is how he envisions the next set of powertrain regulations after 2026 to feature “lighter, simpler and noisier engines.” I gave my take on this in yesterday’s Sustainable Motorsport Roundup Contemplating a Hybrid-Free Future for Formula 1. The idea is not as crazy as it sounds.
Despite the ongoing Hollywood actor and writers strike, work on the Lewis Hamilton produced F1 film continues on with production and filming of the movie set to continue at this weekend’s Hungarian Grand Prix.
Meanwhile, Forbes reports that billionaire F1 boss Toto Wolff increased his net worth by 60% this year. “Forbes now estimates Wolff is worth $1.6 billion, up from his previous mark of $1 billion in March. That increase comes because Mercedes F1, the second-most-valuable team on the grid, is now valued at an estimated $3.8 billion. (Wolff, INEOS and Mercedes’ parent company own 33% each.) When Forbes last valued F1’s teams, two years after Liberty Media bought the series in 2017 for $4.7 billion in cash and stock, Mercedes was valued at just over $”1 billion.”
General Motorsport Industry News
Last week I reported that Scuderia Glickenhaus were not so certain to be racing at Fuji and Bahrain amidst their precarious finances. With the release of the Fuji WEC entry list, Glickenhaus are not on the list and their future is in doubt in the WEC. “A return to the Nurburgring 24 Hours with its Scuderia Cameron Glickenhaus 004C GT racer is on the cards for 2024 after the team opted to skip this year’s race to focus on its WEC programme. “The Nurburgring makes more sense for us, because it promotes the car we are building for the road,” he said. “The cost, of course, is also much lower.”
Speaking of the WEC, drivers participating in the FIA World Endurance Championship have had their driving licenses and ID leaked, according to a report from CyberNews. “Researchers from the website found, on June 16th, two misconfigured — publicly exposed — Google Cloud Storage buckets. Combined they held over 1.1 million files, among them passports, driving licenses, and government-issued IDs for drivers racing in the WEC.”
WEC has responded saying that extra security measures are now in place.
Mercedes-AMG is pushing forward with the development of an all-new GT3 car, making “internal progress” with the model that is set to replace its current product in 2025. “Head of Customer Racing Stefan Wendl said the manufacturer is “highly focused” on developing the successor to the Mercedes-AMG GT3 Evo, which is competing in its fourth year in Evo specification.”
While Mercedes is looking ahead, Audi Sport is receiving heavy criticism from teams after they announced their factory GT3 exit. “When Markus Duesmann started, he had decided to get out of the Class 1 DTM. That was the first step. But very quickly he also decided to stop motorsport in general and put all his efforts into Formula 1.”
Speed Cafe is reporting that Supercars is on course to secure a multi-year deal to race at the Formula 1 Singapore Grand Prix starting as soon as next season. “Supercars is prepared to sacrifice the pre-Bathurst Sandown 500 in its traditional mid-September slot to race alongside F1 in Singapore.”
The elimination of the LMP3 class from the IMSA WeatherTech SportsCar Championship will not likely have a negative effect on overall car counts next year according to series president John Doonan, who is predicting roughly a 50/50 split between prototype and GT machinery in 2024. “At the moment given all the conversations we’re having, the forecast is very solid and very sunny for the sport,” Doonan told Sportscar365.
Digiday takes a look inside the NASCAR content and influencer strategy with TikTok highlighting local businesses during their recent Chicago street race. “NASCAR is hosting influencers including Jackie Hartlaub (6 million TikTok followers), actress Madeline Ford (2 million TikTok followers), sports content creator Don C (277K on Instagram), YouTube motorsport content creator Grid Clique, and Chicago Food Authority (52K TIkTok followers) to showcase the experience for followers on their social channels throughout the weekend. Nascar Studios is also producing feature content packages about each of the five local businesses that will be published across Nascar’s official social channels.”
PA Homepage looks at how the local NASCAR race drives business to the Poconos. “This is a chance that we get to showcase something that we all know as wonderful, the Pocono mountains, and now we get people from all over the country and all over the world come in that we can show them as well.”
Here is some racetrack news from across the United States.
- County of Monterey Board of Supervisors approves long term concession agreement for Laguna Seca
- Road America is doing fine with no Cup race: ‘If we race coaster wagons’ fans would come
- 63-Year-Old Drag Strip in New Jersey Shuts Down Without Warning
Dorna Sports chief commercial officer Dan Rossomondo tells BlackBook Motorsport that F1’s US expansion doesn’t mean MotoGP will avoid market. “I don’t think [Formula One] has a stranglehold on the market. They’re doing a heck of a job. I’m envious, of course – every time I look at their paddock, it looks like the Oscar’s red carpet. Las Vegas, from all I’ve heard, is going to be an unbelievable success this year, so great for them. But the US is a pretty big market and they can sustain more than one global motorsport event, and I think we’ll be able to find our niche there for sure.”
In other motorcycle racing news, BMW Motorrad Motorsport has created two new roles, with Christian Gonschor appointed technical director and Uwe Geyer head of customer racing – both reporting to BMW Motorrad Motorsport director Marc Bongers.
Shift Up Now, Inc. has announced that, as a result of the organization’s growth and success, Erin Vogel will join the management team as President. “Shift Up Now fits my personal mission statement perfectly,” she said. “It’s the opportunity I’ve always hoped for to make a real and lasting difference in the fight for gender inclusion and equality of opportunity for women. I’m very proud, excited and honored by this opportunity to help grow an organization that is making a difference in the careers of female athletes, and to see those athletes continue to rise to greater and greater success in time.”
Parella Motorsports Holdings has announced that Michael Printup will join the company as the President of Sportscar Vintage Racing Association (SVRA). In his new role, he will oversee the day to day operations of one of the oldest and largest national vintage racing organizations in America. Printup brings nearly three decades of motorsports experience to the role and is best known for his work as President of Watkins Glen International (WGI), where he has spent the last 15 years.
Sports agency giant Wasserman has reached a deal to acquire London-based CSM Sport & Entertainment. It is the largest acquisition for Wasserman since a private equity investment from Providence Equity in November. Financial terms of the agreement were not released. The transaction is expected to close in the third quarter of 2023. CSM has more than 1,200 employees at 20 locations around the globe, and its sports marketing clients include insurer AIA, the Alpine Formula 1 team and rugby union squad British & Irish Lions. Providence is also an investor in CSM’s parent, Chime Communications.
In light of the Wasserman deal above, Profluence Sports by Andrew Petcash looks at the rapid transformation of sports agencies and where it’s all headed. “Agencies have direct access to the athletes who now want ownership positions — so plays are being made to make sure the needs are met.”
Motorsport Sponsorship & Partnership News
RTR Sports Marketing has a fascinating article on how the race helmet has evolved from being primarily safety gear into a marketing powerhouse. “From a sports marketing perspective, a logo’s placement on a Formula 1 or MotoGP helmet holds significant value. Despite their relatively small size, these helmets are incredibly prominent, both on the track and in the media.”
NASCAR has seen sponsorship from Fortune 500 companies fall by around two-thirds over the last 20 years. 60% of primary sponsors at 2005 Daytona 500 were part of the Fortune 500. This number fell to around 20% at this year’s race.
The business of sports relies on multiple revenue streams, and the trend lines have now stabilized from the shut-down lows of 2020. Speed Sport examines the current state of racing sponsorships. “There has been double-digit growth in the number of brands purchasing motorsports sponsorships or media. The number of entities supporting racing on the track or with commitments to series, teams and drivers are one quarter of all other sports leagues combined.”
Here are the latest motorsport sponsorship deals, partnerships and related analysis that were announced this week.
- Chip Ganassi Racing, Omologato announce partnership
- Desafio Ruta 40 adds YPF title sponsorship, Desafio Ansenuza
- IndyCar: DHL and Club Athena to promote women in STEM at IMS
- R&J Batteries renews partnership with BJR
- FEL Motorsports and Michelin Motorsports reach 3-year partnership agreement
- Spire Motorsports, Gainbridge Agree to Multi-Year Sponsorship; Andretti Making Truck Debut at Mid-Ohio
The Business of Running a Race Team
Formula Scout looks at the free change that has made Van Amersfoort Racing more operationally efficient in F2. “Building up a team is a challenge because building up a team means you have to put people together, which in the end didn’t choose each other. So it’s very hard to make a team out of those people,” van Amersfoort explained. “So a driver with experience is of course very, very important. And we specifically chose Richard also. I’m speaking English now, but you maybe already found out that it’s not my native language. And so to take every problem, every little detail out of the communication is important. And that’s, of course, still always the best in your own native language. And that plays an important role in our success we have now.”
Here is a roundup of the latest team news from around the world of motorsport.
- Inter Europol Plotting IMSA LMP2 Effort Next Year
- Sean Creech Motorsport confirms Ligier chassis for 2024 IMSA LMP2 debut
- Proton faced ‘enormous’ time pressure ahead of Monza Hypercar debut
- Isotta Targeting 15,000km in Testing Before Homologation
- Fabricio Pezzini switches cars as Paladini Racing expands with two Audis