On the eve of the inaugural Las Vegas Grand Prix, Formula 1 announced their Third Quarter financial results which continue their positive revenue momentum. It’s all part of this week’s Business of Motorsport.
I also bring you an array of news and analysis on NASCAR as they conclude their 2023 season, the broadcast finances of Supercars and Road America’s positive economic impact.
All this plus the latest sponsorship deals and partnership news as well as global team developments in this week’s edition of the Business of Motorsport Roundup on Motorsport Prospects. Its business news racers can use.
Motorsport Industry News
Formula 1 continued to boost its revenues in the third quarter of 2023, with the headline number rising from $715m in 2022 to $887m, representing an increase of 24%. F1 CEO Stefano Domenicali remains bullish about the organisation’s prospects.
“This growth is attracting commercial partners, including our recent agreement with American Express that marks the first new sports vertical they have sponsored in over a decade. We are making material progress on our sustainability initiatives, including reducing F1’s corporate emissions and amplifying F1 Academy by fully integrating the series into the 2024 F1 calendar with participation from all ten F1 teams.”
“Our business is in a position of strength. Fan engagement is high, and commercial interest is strong,” said Stefano Domenicali, F1 president and CEO, told analysts. “The teams have sustainably improved their financial health, generating their own incremental sponsorship, which benefits our entire F1 ecosystem.”
As their momentum continues, Liberty is getting ready for the Las Vegas Grand Prix, a race that they themselves are promoting and have invested a considerable amount of money in.
Speaking of Vegas, the Las Vegas Grand Prix is set to make its debut next week and to say there have been growing pains is an understatement. Of course it is the first year of a wildly ambitious race so as I have mentioned, we may want to cut Liberty a bit of slack.
According to research by Joe Pompliano, ticket prices for the Las Vegas Grand Prix are plummeting. Here are the numbers:
Cheapest Tickets On 10/8
Current Get-In Prices
Thursday: $162 (-58%)
Friday: $312 (-62%)
Saturday: $1,087 (-34%)
Hotel prices have dropped 58%, too.
Liberty Media CEO Greg Maffei: “We remain highly confident in the increased efficiency to operate there and our growing profitability in years two and beyond. And we remain bullish on the broader value creation at LVGP that far outweighs the increased investment and startup costs.”
I have included a selection of articles and analysis for your convenience. And yes, of course I will be watching.
- Showtime is almost here for F1’s Las Vegas gamble (Racer)
- Las Vegas Grand Prix cancel F1 grandstand construction despite selling out tickets (GP Fans)
- Dramatic drop in Las Vegas hotel rates triggers F1 fans chasing refunds (Planet F1)
- Workers Are Worried About Europeans Tipping During the Las Vegas GP (Road&Track)
- F1 not alarmed about spiralling rising Las Vegas GP costs (Motorsport.com)
- 35,000 Workers Could Strike the Las Vegas Grand Prix (Road&Track)
- MGM And Caesars Avert Strikes By Las Vegas Casino Workers—Days Before Formula 1 Grand Prix (Forbes)
- Why F1’s first Las Vegas grand prix was an utter failure — and a ‘lesson learned’ (The Athletic)
- Formula 1 Owner Liberty Media Calls Las Vegas Gran Prix A “Massive Undertaking” But Says Race On The Strip Will Be One Of A Kind (Deadline)
Despite rumors to the contrary, GM has insisted that it is only interested in entering F1 with Andretti, despite the fact that Michael Andretti thinks the other teams consider them to be “hillbillies.” Speaking to news agency AP about the possibility of working with another team, GM president Mark Reuss said: “GM is committed to partnering with Andretti to race in F1. The collaboration between Andretti-Cadillac brings together two unique entities built for racing, both with long pedigrees of success in motorsport globally.”
Planet F1 has an informative article on the FIA’s significant financial gain from F1’s Sprint race increase. Because the Sprint races hand out extra points to the drivers and the total points determine what the teams and drivers have to pay to enter F1 the following season, the extra 108 points offer significant financial gains to the FIA.
“But the 108 extra points last year will also have raked in €226,800 ($242,500), and when added to the team fees, the three Sprints last season will have meant that the FIA earned approximately $951,350 from additional fees for the 2023 season.”
The rumors of problems within Audi and their F1 entry have persisted in the last few months. Sauber team representative Alessandro Alunni Bravi has issued a statement clarifying and refuting these rumors.
“Audi have a strong commitment to Formula 1, of course together with Sauber. This commitment comes from a decision not only of the board of Audi but also the advisory board of Audi and the Supervisory Board of Audi Volkswagen. It’s a group decision and the commitment is there.”
Meanwhile, rumors are that ex-Ferrari supremo Mattia Binotto has once again been linked to Audi.
Formula 1 has announced that they will continue to race in São Paulo until 2030. Stefano Domenicali, President & CEO of Formula 1, said:
“I am delighted to announce we will be staying at Interlagos until 2030, and I can’t wait for many more years of the wonderful atmosphere that the Brazilian fans bring. Brazil has such a rich racing heritage, and this iconic circuit is a favourite of drivers and fans around the world. It embodies everything that is great about racing, and we look forward to seeing how it develops over the years to come to create an even better experience.”
With a record 24 races on the calendar next year, is it possible we may see Malaysia returning to the calendar sometime in the future? As reported by Malay Mail, Sepang International Circuit (SIC) will be known as Petronas Sepang International Circuit after the track signed a crucial naming rights deal with Petronas, a Malaysian energy group. This partnership has given a massive financial boost to the circuit, which will now be able to host top-tier racing series like F1.
After the deal was sealed, SIC’s chief executive officer Azhan Shafriman Hanif said: “This development shall open doors to new opportunities to host more world class events at our world class venue for Petronas as one of the industry leaders in motorsports through its engagements in Formula 1 and MotoGP.”
In the never-ending saga of Williams Racing’s attempt to collect their creditor’s claim from former sponsor Rokit, a federal bankruptcy court has ordered a settlement conference in the matter of a Rokit subsidiary that backed out of multi-million dollar sponsorship agreements with the NBA’s Houston Rockets and Formula 1’s Williams Racing according to Sportico.
“The settlement conference, currently set for Dec. 5, comes after numerous fits and starts in the bankruptcy proceedings of Able Events Inc., a Rokit subsidiary that previously went by the name Rokit Marketing Inc. In March 2022, that entity filed for Chapter 7—becoming one of six Rokit subsidiaries to seek bankruptcy protection over a span of 14 months.”
General Motorsport Industry News
There was a lot of NASCAR news after the conclusion of their season in Phoenix. Overall things are looking stagnant for the American stock car series with attendance improving but a far cry from the series’ glory days while overall TV ratings are down. And then there lurks a lawsuit accusing NASCAR through its driver diversity programs of “illegal discrimination against White, male Americans.” NASCAR for its part has stated that their diversity efforts will continue.
“I’m proud of the work that we’ve done in the areas of diversity inclusion to broaden our sport,” NASCAR President Steve Phelps says. “We are going to continue efforts to have the entire country, the entire world, come to our facilities, watch it on television because it’s about a love for racing. I think … racing is a great opportunity for people to come together.”
Here are some articles and analysis that provide details on the current state of the series and their hopes and plans for an improving future.
- NASCAR State of the Sport: EVs, Hydrogen, New Short Track, Montreal and More (AutoWeek)
- NASCAR TV Numbers Rebound Near End Of 2023 Season (Forbes)
- Ryan Blaney’s NASCAR Cup Series championship helps open new generation of drivers (Sports Business Journal)
- NASCAR Hits Offseason With International Expansion Under Consideration (Front Office Sports)
- NASCAR, Nexstar see big growth opportunity (Sports Business Journal)
- NASCAR 2023 season review: Breaking down TV viewership, attendances, and other commercial storylines (BlackBook Motorsport)
- SBJ Unpacks: NASCAR Cup Series viewership drops 5% in 2023 (Sports Business Journal)
- New TV deal needs to come before charter agreement – NASCAR’s Phelps (Racer)
- NASCAR Accused of ‘Illegal Discrimination Against White, Male Americans’ (AutoWeek)
- NASCAR And F1 Are Competing For US Racing Fans. Is There Room For Both? (Front Office Sports)
- NBC Sports reports audience gains for 2023 NASCAR coverage (Racer)
IMSA President John Doonan talked to Grassroots Motorsports on the future of pro racing and how season 1 of the IMSA GTP era was so well received by fans and competitors alike.
“I think audience growth is huge for us, and the next generation of fan and audience is significant. From a social and digital standpoint, from an event standpoint, we’re going to work with our promoters and try to fill these race tracks with new fans. The next generation is really important for us.”
Speed Cafe delves into the financial implications of The Bend being omitted from the 2024 Supercars calendar. “The championship’s television contract stipulates a minimum of 12 events and there are indeed exactly a dozen on the 2023 calendar.Under the terms of the Teams Racing Charter, Supercars is obliged to pay charter holders a higher grant if the season spans more than that minimum.”
Late last month, South Australia’s $30,000,000 (USD) Dragstrip at the Bend opened its doors to the largest ever drag racing crowd in that state’s history according to Dragzine.
“The Dragstrip at The Bend is the latest discipline of motorsport to be run at The Bend Motorsport Park that includes an international motor racing circuit, a rally course, a karting track as well as two hotels and a trailer park. It is owned by the Peregrine Corporation that is a business run by the Shahin family that includes property investment, specialty stores and service station sites. Dr. Sam Shahin has made the Bend Motorsport Park his personal project and no expense was spared to build the dragstrip.”
Dorna Sports, commercial rights holder of MotoGP, has agreed a long-term media rights deal with pay-TV broadcaster Sky Deutschland. The long-term deal covers Germany, Austria and Switzerland. The contract kicks off from the start of the 2024 season and the agreement also includes Moto2, Moto3 and MotoE.
The Sheboygan County Economic Development Corporation (SCEDC) proudly celebrated its 13th Annual Meeting at the iconic Road America, where the community came together to applaud the achievements of the past year and embrace the endless opportunities on the horizon. As the highlight of the evening, the SCEDC and SCEDC Board took great pleasure in announcing Road America as the distinguished recipient of the 2023 Economic Driver of the Year award.
Last year, Road America contributed $254 million to the County, with an economic impact of $403 million benefiting the state of Wisconsin.
Amidst series fleeing the platform and massive layoffs, Motorsport Games has reported their Third Quarter 2023 Financial Results. “As underperforming business units and projects have been closed, a new sense of optimism continues to emerge,” said CEO Stephen Hood, whose company laid off 38 employees (or roughly 40% of its work force) in the last two weeks, nearly a year after its board of directors resigned a year ago amidst disagreements over cost-cutting measures. Now, nine months into that financial restructuring plan, MSG, under Hood’s leadership after he assumed the CEO role this spring, has slashed $6.7 million in operating costs through the first nine months of this year.”
Motorsport Sponsorship & Partnership News
Here are the latest motorsport sponsorship deals, partnerships and related analysis that were announced this week.
- FIA appoints Pirelli as official tyre partner and supplier for FIA GT World Cup (FIA)
- How Coca-Cola celebrated the 25-year legacy of its NASCAR racing family (Marketing Drive)
- Sponsorship Analytics Just Got a Currency-Grade Upgrade (Relo Metrics)
- Netflix Charging $2M To Advertise With Live Sports Event (Front Office Sports)
- Fox on verge of confirming NASCAR media rights deal (BlackBook Motorsport)
- World RX signs logistics partnership with Kuehne+Nagel (BlackBook Motorsport)
- Omologato announced as Official Timepiece of FEL Motorsports (FEL Motorsports)
- Fujifilm Middle East announced as key Dubai GP Revival event partner (Dubai GP Revival)
- Aston Martin F1 Team announces ServiceNow as its Official Intelligent Platform Partner (Aston Martin)
- Cherry x Oracle Red Bull Racing (Cherry LA)
- AlphaTauri F1 agree Bandai Namco deal for Las Vegas GP (BlackBook Motorsport)
Here is a roundup of the latest team news from around the world of motorsport.
- Driver and engineer unite in new team (Speed Cafe)
- Pinnacle Motorsport and B-Max Racing launch 4-car F4 South East Asia program at Macau (Pinnacle Motorsport)
- Atlantic Racing Team to compete in the 2024 US Formula Regional Americas Championship (FR Americas) series (Atlantic Racing Team)
- D’station Expecting to Receive Aston Martin LMGT3 Berth (Sportscar365)
- Momentum building for Porsche Penske WEC program at year’s end (Racer)
- ACO to Prohibit Non-WEC LMGT3 Brands at Le Mans (Sportscar365)
Motorsport Movers & Shakers
Inc. Magazine has an excellent feature on the leadership of Aston Martin Team Principal Mike Krack that is well worth the read.
“Once the team is executing the plan,” Krack says, “it’s extremely important to force yourself not to interfere. Afterwards, you can analyze what you could have done better, how you used the information you had at the time to make certain decisions, and how you could make better decisions in the future.”
In short: Just because you can step in doesn’t always mean you should step in. Create a plan. Execute the plan. Then review, revise, and iterate.
“You hired experts,” Krack says. “Why would you then tell them what to do and how, especially when they’re in the middle of executing the plan everyone agreed upon? If you’re going to do that… why hire experts in the first place?”Highly Effective Leadership, Literally at Speed: Aston Martin Formula 1 Team Principal Mike Krack | Inc.com