It has often been said that motorsport is as much a business as it is a sport. While my “Business of Being a Race Driver” deals with those business aspects that a driver must deal with in their off-track time, the “Business of Motorsport” deals more with the industry as a whole be that track owners, series administrators, manufacturers or the multitude of motorsport professionals who make motorsport their business. As a driver, it is always important to understand the industry you are so intimately involved in. This weekly round-up should bring you some of the highlights.
As always, if you have news that you feel should be included in this weekly round-up, do not hesitate to contact me.
The Administration of Motorsport
- With the FIA election over and Mohammed Ben Sulayem of the United Arab Emirates becoming the first non-European president of the FIA, it is time for him to begin implementing his platform. Aside from the Formula 1 issue he has to deal with as mentioned below, Sulayem has made the growth of motorsport a key plank in his platform. New FIA vice-president, Singapore’s Lee Lung Nien, hopes to see more Asian drivers as the FIA considers opening a regional office in Singapore as part of the plan.
The Business of Sponsorship
- Nascar seems to have some renewed momentum behind it as they prepare to race their next gen car and sponsorships seem to be up. Aside from the messy issue of Brandon Brown’s sponsorship, a number of teams have announced new sponsorship deals.
- The Williams Formula 1 team received some more positive news as they slowly crawl themselves out of the F1 cellar when they announced that they have won their $35m lawsuit against former title sponsor ROKiT. Williams urged the court to enforce the award against ROKiT which it won from a London Court of International Arbitration tribunal in 2021.The award was made up of roughly £26.2m in missed payments, as well as a $1m in bonus payment.
- In other Formula 1 news, while Ferrari ended their nine-year UPS partnership, they promptly announced that they had inked a multi-year deal with Switzerland-based blockchain firm Velas Network to create exclusive digital content for fans.
- After a decisive end to a riveting season, the FIA has outlined their Abu Dhabi analysis timeline with results expected only 2 days before the 2022 season begins. It will be interested to see if anybody is satisfied with what they decide and what impact, if any will it have on the growth trajectory the sport is currently enjoying.
- Despite the controversial ending, Formula 1 wrapped up a historic 2021 season financially with increases across the board.
- Formula 1 exemplifies class and exclusivity with their Paddock Club and associated race-related activities. Despite Covid they continue to innovate as Blackbook Motorsport explains in how Formula One transformed its hospitality product.
- With the remit that the FIA and Liberty needed to “save the teams from themselves,” 2022 marks the debut of the new budget cap in the series. Forbes looks at the implications of the cap and how it will impact the smaller teams in A New Budget Cap Gave Small Teams A Reason To Stay In Formula 1. They’re Thinking Much Bigger.
- Remind me if you’ve heard this one before but its the story that won’t go away in that Audi and Porsche are expected to take part in F1 starting in 2026. And as they consider entering the fray, Honda has left the sport, but will they eventually return? They are starting to hint that they just might.
- Finally, as the FIA has always insisted that manufacturers benefit from participating in F1 because it translates to their road-going cars, Daimler AG, the parent company of Mercedes-Benz, used experts from its Formula 1 racing team to produce an electric prototype to compete with Tesla.
- Formula E has been weathering a bit of a storm with the body blows they suffered from BMW, Audi and Mercedes leaving the series and Porsche’s commitment seemingly short-term as they prepare to enter (or not?) Formula 1. But the year started with good news as Maserati announced their return to single-seater motorsports with Formula E.
- Why did Maserati decide on Formula E and how will it all work? The Race takes a look at the plan.
- Along with the news that Maserati will be joining Formula E, Front Office Sports also reports that the series numbers are getting better though not at all spectacular. “Despite canceling nine of its 14 scheduled races during the 2019-20 season, Formula E lost just $43,700 before taxes in its sixth season, down from a loss of $12 million the year before.”
- In other Formula E news, the series announced that they have renewed their sponsorship agreement with DHL ahead of the season opener. Not only will the two continue their logistics partnership but they will collaborate on a number of initiatives to maximize efficiency and reduce Co2 emissions.
- Amongst a number of positives for 2022 regarding car counts and fan popularity, IndyCar announced a $1m PeopleReady Force for Good Challenge. “The PeopleReady Force for Good Challenge will help drive home PeopleReady’s mission to connect people and work as a force for good in the communities they serve while highlighting the skill of NTT IndyCar Series teams and drivers and our collective commitment to helping others,” Penske Entertainment Corp. President and CEO Mark Miles said. “This program will keep fans engaged all season and continue to raise vital awareness for a variety of worthy charities.”
- The value of a NASCAR Cup Series team charter has reached $12 million, doubling last year’s asking price of $6 million, according to Sports Business Journal.
- All is not rosy though as teams are coping with supply chain issues on Next Gen parts according to Racer.
- Professional Motorsport World has a look at the WEC and Le Mans-bound Scuderia Cameron Glickenhaus SCG 007 in-detail.
- Daily Sportscar has a great look behind the scenes of BMW’s journey to LMDh with MBedded, BMW’s Journey To LMDH Chronicled.
- What motivates a manufacturer to take part in motorsport? Grassroots Motorsports takes a look at Hyundai in Here comes Hyundai | When did Hyundai become a major motorsports player?
- Finally, Praga has expanded its official R1 dealer network with the introduction of Praga Racing Poland.
- With a little over two years under his belt, Roger Penske has outlined the next step in his planned Indianapolis Motor Speedway upgrades.
- All the Race Industry Week presentations are now available as videos you can watch at any time here. You can also access all the talks as podcasts.
- If you are a SEMA member you can view their new seminar video: Motorsports Builders Panel At 2021 SEMA Show.
- Finally, this may seem a bit unorthodox and not strictly motorsport-related but according to Sportico, wagers on sports simulations may play a big role in betting’s future.
See you next week!