With the announcement that the Spanish Grand Prix will move to a street circuit in Madrid, some are wondering if street circuits are counterproductive to what Formula 1 is trying to accomplish, especially with the new rules in 2026.
In other business of motorsport news, Formula 1 introduces possibly the worst team name in its history, Saudi Arabia bets big on electric racing and why Alfa Romeo is not convinced by the “golden age” of sportscar racing.
You will also get details on crypto sponsorship in F1, how Franz Tost built up Toro Rosso and the debut of my Motorsport Legal Roundup. All this and much more in this week’s edition of the Business of Motorsport Roundup on Motorsport Prospects. Your source for the best curated motorsport-business news that racers can use.
Motorsport Industry News
The big news this week in Formula 1 is that the Spanish Grand Prix is moving to a street circuit in Madrid in 2026. A hybrid 5.47km circuit featuring street and non-street sections will be built around the IFEMA fairgrounds and convention centre located to the north-east of the city. The contract for the race is for 10 years which is part of Formula 1’s new approach to contracts with race promoters being long term. The reason for this, F1 CEO Stefano Domenicali says, is to allow promoters and organizers a better chance to be sustainable while also focusing on long-term planning.
With rumors that Osaka could be the next street circuit replacing the beloved Suzuka track, Dan Lawrence in Motorsport Week explains why F1’s street circuit trend is proving counterproductive. “But in an age where F1 cars have grown larger and larger and look at their best at high speeds through fast, sweeping curves, restricting the sport to an increasing number of street venues appears counterproductive, especially when you consider the sport’s vision for the next set of regulations in 2026 is to improve racing.” Others think the fear is overblown.
One street circuit that is going through a somewhat bumpy ride is the Singapore Grand Prix that is ensnared in a rare corruption scandal. Luckily, Singapore’s Ministry of Trade and Industry quickly dispelled any rumors that the race itself might be canceled. “All preparations for the F1 Singapore Grand Prix in 2024, which is scheduled for 20 – 22 September 2024, are on track.”
In yet more street track news, progress appears to have been made in grievances by a number of local Las Vegas businesses with the Las Vegas Grand Prix. “They realize the mistakes that were made, and they’re trying to figure out how to rectify those mistakes for this past year and for years to come,” said Battista’s Hole in the Wall Italian Restaurant Owner Randy Markin.
Vincenzo Landino of The Qualifier does a deep dive into why private equity is targeting investments into F1. “F1 is now seen as a lucrative area for investment, largely due to a system that ensures team values remain high. Spending caps have also contributed to this by limiting expenditures while team incomes have grown.”
We all understand that F1 is considered the pinnacle of motorsport, but is it a closed shop to new talent? Ben Edwards of Autosport Plus argues that it is because there is now too much on the line commercially to take a chance on new talent.
“Some of the biggest issues for younger drivers these days is that the business of F1 is so big that a team taking a risk on a new driver is quite high,” says Mark. “Hence you see guys in their 40s still under contract and teams that have kept drivers for several years. They just can’t take the risk of having someone new and it going wrong; on two or three occasions you see some guys come in and they’re spat out of the system again because it hasn’t quite worked. And some of it fundamentally is that the teams don’t get to understand the drivers’ qualities because they no longer really have a test programme and a test facility in an authentic environment.”
With Zak Brown of McLaren the most vocal in raising concerns about the Red Bull/AlphaTauri (sorry Visa Cash App RB) relationship, Planet F1 has published this handy guide to help out. B teams explained: The strict FIA regulations Red Bull must abide by with rebrand plan. And as one commentator has pointed out, B teams like, ahem, Visa Cash App RB may be severely curtailed in the next Concorde agreement.
Elizabeth Blackstock of Planet F1 explains why Ford’s relationship with Red Bull should worry their US rivals. “We’re going back to F1 in a way that we haven’t in the past,” Farley said. “It turns out that the best aerodynamics in the world are in Formula 1, the best telemetry, the best digital diagnostics. And, actually, we need all those things for electric cars. So it’s actually going back to the ’70s with a pure tech transfer.”
General Motorsport Industry News
The Public Investment Fund (PIF) has unveiled a multi-year partnership, Electric 360, with Formula E, Extreme E and E1 to support the growth of electric motorsports and their role in advancing the future of electric mobility.
Alejandro Agag, Founder and Chairman of Formula E, Extreme E and E1 said: “This one-of-a-kind partnership with PIF is a huge milestone for us in our journey to pioneer the most cutting-edge sustainable transport technology. With so many examples of the positive real-world impact of each series, this 360-partnership takes our potential to the next level. PIF will not only play a strategic role in helping us leverage our unique technological platforms, but also foster global collaboration, education and skills development for the next generation worldwide.”
Mohamed AlSayyad, Head of Corporate Brand at PIF, said: “At PIF, we believe in the power of partnerships, investing in innovative collaborations as part of our focus on ‘Investing in Better.’ These partnerships will enhance the quality of life for people, provide opportunities for the communities we serve, and help continue our work as a catalyst for transformation.
“Together with these championship series, Electric 360 will redefine electric sport and supercharge its growth, delivering tangible impact aligned with our broader business strategy as PIF drives new green technological innovation that will be the cornerstone of future electric mobility.”
Here is a sample of the coverage and analysis:
- PIF creates new Electric 360 partnership with Formula E, Extreme E and E1 (Formula E)
- Saudi fund partners with Formula E, Extreme E to develop electric motorsport (Racer)
- Saudi Arabia’s PIF holds ‘significant stakes’ in electric motorsport series (BlackBook Motorsport)
- Agag lands major new deal as Saudis go big on electric motorsport (Autosport)
- What Saudi Arabia’s new Formula E involvement really means (The Race)
- Electric racing’s ‘milestone’ Saudi deal to ‘pioneer’ sustainable tech (Global Sustainable Sport)
In Formula E news, Sam Smith from The Race looks at the issues surrounding NRE – or ‘non-recurring engineering’ – costs. This is a broad term defining a one-off cost that results from developing, designing and implementing a manufacturing process for a new product.
“The question of which way Formula E goes about sharing the cost of Gen4 is very much tied to the number of manufacturers within the series and, with manufacturers not expected to commit to Gen4 until early this summer, at present there is obviously an element of stasis in the decision making.”
Stefan Mackley in Autosport meanwhile looks at why Usain Bolt’s Formula E cameo is only the start in conquering its final hurdle, visibility.
“One of the things I talked about was to make Formula E noisier,” Dodds said in Mexico. “I think the component parts in the sport are fabulous, the performance of the cars is incredible, we’ve got great driver line-ups, great manufacturers and we race in great places. But the reality is not enough people know about us and engage with that and I guess in one respect I’m quite critical of that because I think there’s a window of opportunity for us to create noise and generate interest. On the other hand, we’re nine years old and we’re competing against other motorsports that are between 75 and 100 years old, so we’re trying to achieve a lot in a very short period of time.”
Formula E recorded positive numbers in TV viewers and social media engagement after the first race of season 10 in Mexico.
The global live overnight race audience in key markets grew by 57% for the 2024 Hankook Mexico City E-Prix, the first race of Season 10, compared to the corresponding opening race of last season, also in Mexico. Social impressions jumped 205% year on year, while the Formula E website – which features rich content introducing new fans to the sport with explainers and driver profiles – also saw its busiest day since launch as well as peak impressions across organic search at almost double that seen this time last year.
Ahead of the 2024 World Endurance Championship, chief executive Frédéric Lequien discusses with BlackBook Motorsport the series’ recent success, the secret to attracting entries from the likes of Alpine, BMW and Lamborghini, and plans to continue growing in the future.
WEC has never been healthier than it is right now. In 2023, we had 13 full-time Hypercar entries; in 2024, that number has increased to 19, a 46 per cent increase in just one season. Adding to that, we have our debut LMGT3 season, which – similar to the Hypercar class – was over-subscribed. This year, we have 18 entries.
Across both categories, we have 14 manufacturers competing in WEC – I’m not sure there is another world championship with that much diversity. Finally, we have new races in Doha, São Paulo, Imola, and Texas this year, so we are taking the spirit of Le Mans to new territories. We are experiencing a truly golden era of endurance racing at the moment.Soaring viewership, a global calendar, and blue-chip manufacturers: WEC’s CEO on the ‘golden era of endurance racing’
One manufacturer that is not as convinced about racing in the WEC Hypercar class is Alfa Romeo whose CEO Jean-Philippe Imparato is not convinced by the economics of a Le Mans return. “Furthermore, he observed the influx of manufacturers in the WEC and Le Mans posing a “trend towards inflation of expenses”, saying €250 million would be necessary to build a car and run a programme.”
Meanwhile in North America, ESPN reports that the GTP class is rousing interest in IMSA and U.S. sports car racing in general.
“The series debuted its high-tech hybrid Grand Touring Prototypes (GTP) last year, and thanks to the newfound interest surrounding GTP, IMSA received an appreciable increase in attendance and its television audience. Possibly the greatest co-sign for IMSA’s surging popularity has been within the auto industry as 18 car manufacturers have aligned themselves with the series to race and promote themselves in front of those who tend to know the cylinder counts and cubic capacities of each motor in action.”
Mark Skewis offers a glimpse behind the scenes of what many considered to be the finest World Motorsport Symposium to date in the February issue of Race Tech Magazine.
Quick Takes on the Business of Motorsport This Week
- SPC Rubber forms new motorsport tire brand (PMW Magazine)
- F1 Drive: All to know about Formula 1’s first karting experience (Autosport)
- Formula Vee brand sold to Junior Racing Developments (Speed Cafe)
- Plenty of motorsports supply deal changes on horizon (Tire Business)
- Lando Norris’ Quadrant adds YouTuber WillNE as co-owner in seven-figure investment round (BlackBook Motorsport)
- Nascar teams’ media arm targets digital expansion following funding round (BlackBook Motorsport)
Motorsport Sponsorship & Partnership News
With the announcement that McLaren has expanded their partnership with crypto firm OKX, Sasha Rogelberg and Olivia Hicks of Formula Flash takes an in-depth look at Formula 1’s relationship with cryptocurrency sponsors and wonders if crypto firms have become the new tobacco.
“Everyone from finance experts to sports commentators have raised the red flag as beloved pastimes and cryptocurrency overlap. Not only does crypto advertising in sports pose ethical questions, but also credibility issues. It’s not so harmful for the Los Angeles Dodgers’ Shohei Ohtani to convince a fan her next sneakers should be New Balances. It’s another thing to take financial advice from an athlete or buy cryptocurrency because it’s a team title sponsor.”
Here are more of the latest motorsport sponsorship deals, partnerships and related analysis that were announced this week.
- AlphaTauri F1 team makes switch to new Visa Cash App RB identity
- Does ‘Visa Cash App RB’ signal a depressing new trend in F1 team names?
- McLaren Racing expands OKX F1 partnership (BlackBook Motorsport)
- Non-Alcoholic Beer Sponsorships Grow In Sync with Surging Sales (Sponsor United)
- Meguiar’s and ColorSpec to back Motorsport Australia for 2024 and 2025 (Motorsport Australia)
- R&J Batteries Signs Multi-Year Sponsorship Deal with Brad Jones Racing (R&J Batteries)
- Hyundai Announces 2024 Racing Program (Hyundai)
- Ed Carpenter Racing reveals new major IndyCar partnership (Motorsport Week)
- Xpel Australia partners with Repco Bathurst 12 Hour (Bathurst 12 Hours)
- Mission Foods – the world’s leading brand for tortillas and wraps – is joining forces with United Autosports for the 2024 Rolex 24 at Daytona, taking on the role of the Anglo-American team’s Official Food Partner (United Autosports)
- British GT parts ways with title sponsor Intelligent Money (British GT)
- Spurs Accelerate F1 Partnership (Sports Industry Biz)
- Disc Brakes Australia joins Motorsport Australia (Motorsport Australia)
- MAPEI joins Andretti Global for the Indianapolis 500 as Primary Partner for Marco Andretti (Andretti Autosport)
- Whisper to produce Channel 4’s F1 coverage until 2026 (BlackBook Motorsport)
- Motorsport Australia extends partnership with Next Level Racing (Motorsport Australia)
- Michelin Named Official Tire Supplier and Presenting Sponsor for MX-5 Cup (MX-5 Cup)
- Grid Finder poised to grow after joining US based motorsports group, RAFA Racing Club (GridFinder)
The Business of Running a Race Team
Racer magazine has a great feature on how Franz Tost built Toro Rosso.
“We were always pushing to get the most out of it, we never saw ourselves as the second team – we saw ourselves as an F1 team with the target to educate young drivers,” says Tost. “Yes, most of the time we finished seventh in the constructors’ championship, which was not what I expected, I wanted to be better. But also in the future, don’t see this as a second team. It’s working independently, using all the synergies possible.”
Team & Manufacturer News
Here is a roundup of the latest team news from around the world of motorsport.
- How Formula E plays a key role in the Andretti Global portfolio (Racer)
- Griffin Core forms joint venture with Campos Racing for F4 Spain assault (Campos Racing)
- Forte building towards an IMSA GTD crown (Racer)
- Haas’s model needs to change – Steiner (Racer)
- Why Williams F1 is no longer living “hand-to-mouth” (Autosport)
- Drissi Motorsports Acquires Assets and Retains Talent from Showtime Motorsports (TransAm)
- WSR aiming to be ‘back where we should be’ in 2024 (Touring Car Times)
- Dragon Racing to Make Series Debut With Ferrari 296 GT3 (Sportcar365)
- Champagne Racing to operate Gonella Racing F4 team. (Gonella Racing)
- Alpine balancing long and short-term F1 development (Motorsport Week)
- The devil’s in the details as PPM tackles year two with the Porsche 963 (Racer)
- Cadillac planning V-Series.R upgrade for 2025 (Racer)
- Ford, Multimatic Ramping Up Production of Mustang GT3 (Sportscar365)
- Michele Imberti returns to TCR Italy with his own team (TCR HUB)
- Tuder Motorsport will join the TCR Italy series in 2024 (TCR HUB)
- Skip Barber Racing Unveils Michelin Pilot Challenge Program for 2024 Season (Skip Barber)
- Salters: Acura Taking ‘Analytical’ Approach to Year Two of GTP (Sportscar365)
- F2 teams complete shakedown with new 2024 car (Motorsport Week)
- Dan Mitchell: The British expat aiming to forge America’s future F1 stars (Formula Scout)
- McLaren’s Nissan decision and more – Formula E grid latest (The Race)
- Erebus names Team Principal ahead of 2024 title attack (Speed Cafe)
Motorsport Movers & Shakers
She.Work has a great profile and interview with Beth Paretta, Founder and CEO of Paretta Autosport.
“Beth Paretta’s accomplishments in the racing industry have laid the foundation for women and underrepresented groups to thrive in this exhilarating sport. She has proven that not only can women compete in motorsports, but they can also lead successful racing teams. Her unwavering dedication and fiery passion for the industry inspire a new generation of women, encouraging them to chase their dreams and leave an indelible mark on the racing world.”
Motorsport Law Roundup
I mentioned this last week but here are more details about the group suing Laguna Seca to end racing entirely, despite the fact that the track has been in the same location since 1957. Laguna Seca has responded to the legal threat with quiet confidence.
“A spokesman for Monterey County told sfgate.com that it “is unfortunate certain individuals have chosen to file a complaint against the County concerning operations at Laguna Seca” and that it “does not recognize any merit to the allegations and expects a favorable legal conclusion”.”
IndyCar champion Alex Palou has explained why he reneged on his McLaren contract with reasoning that leads me to wonder who is providing him with advice.
“There were no signs that anything was going to open for me in F1,” he said, after completing simulator work.I am too told to wait and see if someone get hurt and that is how I can get my chance.”
Clearly there should have been more thought into the McLaren offer before signing on the dotted line as he could have come to this conclusion before signing. It will be an expensive lesson that he will learn as the issue now, as it always is when litigating contracts, is how much in damages he will owe McLaren.