In this week’s Business of Motorsport, I cover everything from Porsche and Audi going to F1 to why motorsport has not been sharing in the sports betting boom. I look at the organization behind the Miami Grand Prix, Suzuki’s MotoGP exit, series and team sponsorship deals, a new track in Tennessee and more motorsport industry news.
Motorsport Industry News
- What has evolved into a long running motorsport equivalent of a soap opera, Audi and Porsche have finally decided to enter Formula 1 according to Volkswagen Chief Executive Herbert Diess. “Formula 1 is developing extremely positively worldwide,” he said. “That means you can decide now to do Formula 1 – or then probably not again for ten years. And our two premium brands think that’s the right thing to do, and are prioritising it.”
- Part of the reason that VW is planning to finally commit to F1 is ROI. According to Forbes, “a large part of running out of arguments centers on the financial return on the F1 investment. Diess said that return through sponsorships, brand exposure, and more that now come with Formula 1 is greater than the investment into the racing league. Liberty Media-owned F1 continues to grow in popularity through the docuseries Drive To Survive, and that factored into the decision.”
- Part of that ROI comes from the United States, a critical market for both Porsche and Audi and as Racefans reports, F1’s America-first strategy delivers big win on eve of Miami GP. “A sell-out crowd of 240,000 will attend this weekend’s inaugural Miami Grand Prix, with 82,500 filling the course around the Hard Rock Stadium on Sunday. The event promoters already plan to increase capacity for coming seasons.”
- If you are curious about how the Miami GP came together, have a look at the Forbes article How Miami’s Debut Formula 1 Race Came Together, From Track To Food.
- If you are a long time follower of F1 as I am, you are more than familiar with the checkered past (pun intended) of Formula 1’s often rocky ride in the United States. From casino car parks to a racetrack consisting almost entirely of right angles and no publicity, they have had their challenges. But with three Grands Prix on American soil in 2023, commercial rights holder Liberty Media has made good on their promise to make Formula 1 popular in the USA and Jalopnik looks at how they did it in The Years-Long Marketing Push That Finally Led To Formula One: Drive To Survive.
- If you are a long-standing Formula 1 fan, along with the series’ struggles in the US you will no doubt be aware of the often acrimonious relationship between the teams, manufacturers and the FIA. Since I have been following F1 in the early eighties, there have been at least three semi-serious attempts to start a breakaway series with none having succeeded. In How the relationship between F1 and the FIA has taken a significant twist, Racing News 365’s Dieter Rencken looks at how the recent impasse over expanding sprint races next year has led to the rare instance of the FIA vetoing Liberty and the teams’ plans. Could this be a sign of a growing rift or a one off? Only time will tell.
- Meanwhile, as Porsche and Audi prepare to enter F1 in four years time, Suzuki has announced that they are leaving MotoGP at the end of 2022, catching everybody off guard. Reputedly for financial reasons, they announced the decision to the team during testing this week but as of this writing, have not publicly announced their departure. That could be because they signed a contract with MotoGP organizer Dorna just last year committing them to the series until 2026. Dorna have publicly stated in essence, “not so fast!” Their full statement reads: “Following recent rumours of Suzuki departing MotoGP at the end of 2022, Dorna Sports has officially contacted the factory in order to remind them that the conditions of their contract to race in MotoGP do not allow for them to take this decision unilaterally.”
- Building of the positive momentum of their Gen3 car unveiling and another competitive Monaco ePrix, Formula E have announced that they will be racing in São Paulo. “We are delighted that the ABB FIA Formula E World Championship will be heading to Brazil for the very first time pending approval at the FIA World Motor Sport Council in June,” says Formula E Co-Founder and Chief Championship Officer, Alberto Longo. “The country has a huge, long-standing passion for motorsport, it’s a big market as one of the largest countries in the world, and São Paulo itself is a historic race location.“
- Last week, I had mentioned the rumor that Abt would be returning to Formula E and this week they have made it official. “Formula E has always had a big place in our hearts and we have never made a secret of the fact that we want to be back,” said team boss Hans-Juergen Abt. After the internal kick-off, we are now talking to our current and potential partners. The goal is to bring a strong team to the championship, both on and off track.”
More Motorsport Industry News
- French race car manufacturer ORECA Group has launched a major project to extend its current facilities to support what it says is significant growth. A new manufacturing plant, called the Techno Centre, will be built, with work already underway. It is due to open in 2023. ORECA technical director Rémi Taffin said, “This new racing car production plant is a strong sign, demonstrating that our activity has clearly been picking up momentum. This tool will not only allow us to further progress in our current design, production and assembly activities, but also enable us to shape our future, by providing us with an opportunity to carry out new projects and further strengthen our ‘Made by ORECA’ signature. This new modern plant dedicated to chassis in Signes, together with our engine department’s new hydrogen facilities in Magny-Cours, definitely confirm that ORECA Technology is a key player with a worldwide influence.”
- Autosport looks at the British Touring Car Championship and how it has successfully managed a reboot. “Over the last two years, people bought cars and we just slowly but surely pointed it in the right direction, but it hasn’t been easy,” said Lines. “It’s been a hard slog, we’ve had a lot of obstacles in the way with COVID-19, and not saying BTCC are a fan of ours but they’re not.”
- Motorsport UK and Forestry and Land Scotland have finalized a landmark agreement until 2030 for rally and motorsport events. Under the agreement, Motorsport UK member clubs can continue to request permission to organize rally and motorsport events and practice sessions on access roads and tracks within the FLS estate. In addition, Motorsport UK will be permitted to carry out training sessions for event officials and marshals. Furthermore, FLS and Motorsport UK will work together to ensure events are aligned to Motorsport UK’s Sustainability Strategy to ensure there are no adverse impacts on the environment.
- Sports betting is taking professional sports by storm with everything from football to ice hockey incorporating public betting and betting companies into their activities. All sports that is but motorsport. Ross Fruin, CEO and founder of GridRival argues that the sports betting industry can only ignore motorsports for so long. “While the likes of NFL and college basketball are riding the wave of legalized sports betting, motorsports remains neglected, to a large degree, by sports betting operators. Race series do not have visibility on the navbars of popular betting websites, while broadcasters tend not to take advantage of the kind of in-play bets that have enhanced the fans’ experience in other sports. This is even more bizarre when you consider that the combination of split-second driver decision-making and potential technical issues makes motorsports perfectly suited to in-play betting.”
- Motorsport Australia has outlined its new Queensland based Women’s Officiating Pathway Program, which will officially begin at the end of next month. With the support of the Queensland Government, the Women’s Officiating Development Program aims to provide opportunities to 10 female club officials in Queensland and help them progress from club level officiating to working at state level and higher.
- Grassroots Motorsports has a great look at how University of Georgia students turn STEM classes into racing reality. “Dr. Mativo, faculty advisor to the club since it formed back in 2014, has seen it grow to not only compete and race cars, but to bring many different types of engineers together to work toward a common goal and gain real experience in a significant field of engineering.”
- Merecedes F1 boss Toto Wolff talks mental health, motivation and more on the Saïd Business School’s Leadership 2050 podcast.
- In less than good news, ex IMSA racer JC Perez has been jailed for medicare fraud. He was sentenced to 5 years in prison (plus three years of post-release supervision), with property seized against a $30 million forfeiture order after a three year fraud case surrounding a conspiracy to submit over $109 million in false and fraudulent medicare claims by Perez and a group of associates.
In this week’s racetrack news, it is nice to report progress and new racetrack openings instead of closures.
- GC Performance Classics proprietor Jeremy Carpenter, along with a couple of his clients, saw a need for a sports car-oriented facility for the Nashville, Tennessee, market. Thus, Carpenter’s spearheading the effort to construct the Tennessee Downs in nearby Shelbyville, Tennessee. Grassroots Motorsports has all the details and track maps.
- In England, Brands Hatch has completed a major resurfacing project while in the United States Monterey County has approved $9.7 Million in Laguna Seca upgrades.
- Finally, if you have fallen in love with Barber Motorsports Park, Forbes has a great article on how an Alabama dairy owner created IndyCar’s Augusta National. “I don’t want to put you in a stand where you are elbow to elbow with somebody for a couple hours,” Barber explained. “That just doesn’t work. I want to sit you on a bank with a shade tree and your beer cooler and then get tired of looking at the race from that point and get on the tram and go to the next corner.”
Motorsport Sponsorship News
Series Sponsorship News
- Kicking off this week’s Motorsport Sponsorship News is the W Series. As they prepare for their first race of the season in Miami, the series has announced that Hard Rock International will be the title sponsor of the 2022 season-opening double-header in Miami. They have also announced a new USA broadcast partnership with ESPN.
- Extreme E, the electric off-road racing series, has announced an extension to its partnership with Bosch, who will continue as power tool supplier for the series’ second season. The power tools, power tool accessories, and measuring tools provider will continue to supply its professional equipment to service Extreme E’s electric SUV, the Odyssey 21
- Penske Entertainment, owner of NTT IndyCar Series, has announced a multi-year partnership with Gallagher, a global insurance brokerage, risk management, and consulting services firm. The partnership includes title sponsorship of the Gallagher Grand Prix NTT IndyCar Series event on Saturday 30th July. In addition, Gallagher will sponsor a Team Penske entry at two upcoming events.
- Grill and smoker brand, Masterbuilt will join the Motorsport UK British Rally Championship as Official Partner in 2022, “showcasing their impressive range of charcoal barbecues and smokers designed for ultimate convenience and versatility.”
- Formula 1 has announced an expanded strategic partnership with Workday in a multi-year deal. The multi-year extension will see Workday now become a Regional Partner of F1 – reaching the sport’s huge fan base across Europe, the Middle East, and Africa (EMEA). The expanded partnership also includes the delivery of Workday content across F1 channels, including prominent trackside branding at European Grands Prix.
- Sportico explains how the F1 boom has lured Amazon, Dell and Oracle into a Tech-Sponsor Race. “The sport is getting closer and closer and the margins are even smaller,” said Edward Green, head of commercial technology at McLaren Racing. “Sometimes the difference between positions on the group can be as little as two or three percentage points for that time, the margins are really fine. You’ve got to look for lots of ways to develop and find that competitive edge and I think just give you an example then on the technical front as well, that the reason technical partnerships are crucial.”
- Speaking of tech sponsorship, Software AG has been announced as the Title Partner of the all-electric ERA Championship. Beth Georgiou, ERA Championship Co-Founder and Director said: “Electric racing is hugely technical and the data coming out of the cars is absolutely unprecedented at this level of the sport. We need to have a platform in place to harness this valuable information and present it to the race teams and drivers when it matters most: when it’s happening. We’ve been working closely with Software AG on that already, and we’re delighted that the team decided to extend our relationship by taking on lead sponsorship of our European race series.”
- Finally, Dorna Sports has signed a multi-year new contract in a move to boost fan engagement in MotoGP. “MotoGP represents the best in global motorsports today. Fuelled by our deep broadcast experience, video engineering pedigree and passion for technological advancements, we’re proud to extend this relationship to further accelerate the fan experience,” said Dhaval Ponda, global head of media & entertainment services for Tata Communications.
Team Sponsorship News
- McLaren Racing has announced OKX as a Primary Partner of the McLaren Formula 1 Team. “The relationship with OKX will support the team’s global fan experience, providing fans with exciting opportunities and product innovations to bring fans closer to the action.”
- Ferrari has explained why they feel it important to continue their Mission Winnow F1 sponsorship deal, despite the clampdown on tobacco sponsorship. “It’s important to know that it has been a long partnership with Philip Morris, and we are very proud of it, and very happy that it’s still lasting,” Binotto said.
- The Mercedes F1 team has unveiled their new NFT range. “The team and FTX will release free-to-claim NFT ‘ticket stubs’ – artistic interpretations of a Mercedes-AMG Petronas race ticket – as well as unique and rare NFTs throughout the year, created by some of the world’s leading artists which will be available for auction at various points during the 2022 season, starting in Miami.”
- Finally, the Haas F1 Team has announced a new partnership with financial technology company, Lunar. Founded in Aarhus, Denmark in 2015, Lunar is a regulated and independent licensed bank with over 500,000 users across Denmark, Sweden, and Norway. Established for individuals and businesses, Lunar – a 100% digital platform, has been designed to give customers complete control of their finances in a single app.
The Business of Running a Race Team
- Team WRT is still hoping to run a Hypercar-class program in the future despite Audi’s adjournment of a prototype project that the Belgian squad was due to work on. According to team principal Vincent Vosse, WRT is discussing with other parties to see if it can identify a new way to be involved in top-level prototype racing. “We still have the same plan, just maybe one year is postponed. Maybe we have to move everything [back] one year.”
- In this CEO Series episode of Sports Geek, Sean Callanan chats with Mark Preston, CEO of DS TECHEETAH Formula E team.
- As the Formula 1 Miami Grand Prix culminates on May 8, 2022, it’s not likely to be snowing. The forecast calls for sunny skies and temperatures between 68℉ (20℃) and 77℉ (25℃). But each race team’s ability to accurately anticipate the slightest change in track or air temperatures could mean the difference between finishing without points and popping the champagne on the victory platform. Read how the McLaren F1 Team will be predicting the weather in Taking Their Time Series Talents to South Beach How McLaren Is Gaining an Edge with Accurate Weather Data.
- With an unexpected opportunity to make its third appearance at the Indianapolis 500, DragonSpeed team principal Elton Julian says his team is keen on returning in 2023 and rejoining the paddock it called home on a part-time basis in 2019 and 2020. “I feel we belong here, where you can build the squad and find the resources and whittle away at your program and try to move forward step by step. I don’t have all the answers on how at this point, and sports cars will continue to be our main thing, but we definitely want to be back here next year. Even if it’s only for Indy.”
Movers & Shakers
- Mark Warren will return as CEO for the revived South Australian Motorsport Board to guide a bigger and better Adelaide 500. “I’ve been drawn back to the role because of my passion for the Adelaide 500 and a vision to make it into something even bigger than it has been in its past,” said Warren.
- Following the election last December of Emirati Mohammed Ben Sulayem to the position of FIA President, there have been a number of changes in the FIA Karting organisation chart. Kartsport News interviews CIK-FIA President Akbar Ebrahim.