Liberty Media is taking a calculated bet that the inaugural Las Vegas Grand Prix will be a success. It is critical that it is a success as they promoting it.
In addition to the Law Vegas Grand Prix, here are a couple of more highlights from this week’s Business of Motorsport.
- As real estate prices rise, NASCAR may be looking to sell racetracks.
- After a successful Long Beach race weekend, IndyCar is looking to grow.
- Andretti Autosport quietly reveals their new co-owner.
All this and much more in this week’s edition of the Business of Motorsport on Motorsport Prospects.
Motorsport Industry News
At Auto Shanghai 2023, Audi has offered up details on their F1 project. Powertrain development is well-advanced and the R&D facility scale-up is underway.
Could Aston Martin switch to Honda power in F1 2026? Adam Cooper at Autosport seems to think its possible. “The former Racing Point organisation is currently known as Aston Martin as part of a marketing plan Stroll has for the road car manufacturer. There’s nothing to stop him changing tack in 2026 after running in green for five years, having successfully boosted Aston’s image.”
If you are waiting for Michelin to return to F1, don’t hold your breath. Michelin is still not interested in F1 unless it can supply tires that don’t destroy themselves. “The question is, how do we leverage technology to have a good show? And that’s where F1 comes into play, because we have been discussing with them for a very long time—and we are not in agreement,” Menegaux told The Drive. “Because they [F1] say to have the show, you have to have tires that destroy themselves. And I think, we [Michelin] don’t know how to do this. So, we cannot agree.”
Formula 1 commercial rights holder Liberty Media is taking a calculated gamble that the Las Vegas Grand Prix will be a big success. While they are interested in all F1 events being successful, the Vegas race is being promoted directly by Liberty so it is critical that it does well. Here are a roundup of some articles looking at the business of putting on a race in Vegas.
- F1 Owner Expects Big Return on $500M Vegas GP Investment
- Liberty Media expects Las Vegas GP will take F1 to a new level in the USA
- F1 confident Las Vegas GP “will make a lot of money”, says Liberty chief
- Why F1 hopes what happens in Vegas won’t stay in Vegas
- F1 Las Vegas leaders tout paddock facility progress
- Las Vegas to increase General Admission tickets
As for where else F1 could race, F1 CEO Stefano Domenicali has hinted that Madrid could be in the works. He also has mentioned Africa as a priority while consideration is also being made for East Asia and a potential fourth race in the United States. He has also warned that historic circuits should not rely on their past to grantee them a spot on any future calendar. “To be arrogant and believe that you have a granted future because you had a race for 100 years, to be very honest is not enough. I think at this moment everyone is understanding that, and we are not playing any games.”
As for the concept of rotating races yearly between circuits, Editorial Director Dieter Rencken of Racing News365 explains a potentially fatal flaw with that idea. “The reason comes down to elementary economics: What looks good on paper holds major implications for infrastructure improvements and operational costs, which could only be amortised over double the payback period – or thrice that where three Grands Prix rotate annually.”
Not only is Formula 1 seeing a huge amount of interest from countries and cities wanting to host a race, but apparently from those wanting to start a team as well. While we know about Andretti (of which Zak Brown is still supportive of), Panthera and Formula Equal, there are rumors of Hitech amongst others wanting to join the championship. But the cost of joining will most probably increase.
“When we took over, we really had four goals with the new Concorde Agreement,” Maffei explained. “Create more on-track parity through putting a hard cap in. Putting in a less steeply-graded pay-out to the teams so that the bottom teams had a better chance to make more money. We put in a new series of designs which allowed more overtaking and we made the teams franchises so that the 10 had value.”
One investor who has made his intentions clear is Hong Kong billionaire Calvin Lo who says he is considering backing one of the teams bidding for a future Formula 1 entry. “Reuters indicated that Lo ruled out any involvement in the Andretti/Cadillac and Hitech GP bids, which suggests that Panthera Team Asia might be an obvious target.”
One thing that Domenicali is nervous about is who has breached the cost cap this year. “I’m more than nervous,” he told Sky Sports. “I’m pretty sure that everyone understands now what the effect is if there is a breach, and I totally agree that the focus on this will actually be very big.”
Speed Cafe looks at how F1 is protecting itself from the future. “The challenge facing the sport now is solidifying its new fan base and securing its business model for a future that won’t be able to boast the same explosive growth.”
Finally, rumor has it that Ferrari is set to make ‘profound change’ according to Ferrari chairman John Elkann.
General Motorsport Industry News
The second most popular IndyCar race after the Indy 500 is Long Beach and the organizers have announced that that this year’s race was the most successful since reunification. Meanwhile, as IndyCar looks at where they might race in the future, the odds are good for a Milwaukee return next year.
The head of Le Mans Endurance Management, Frédéric Lequien, has hinted that the FIA WEC may have to place a limit of two cars for each manufacturer in the forthcoming LMGT3 category in 2024, to ensure variety and enough grid spaces for loyal teams and factories.
“One of the ideas on the table is to have two GT3s per manufacturer, and give priority to the manufacturers involved in Hypercar,” he explained. “Saying that, we like diversity also. The perfect situation would be to have spaces for marques, brands, not in Hypercar. We have to find a fair regulation. The idea is that the OEMs will choose the teams.”
Sports Business Journal does a deep dive on NASCAR’s racetrack ownership strategy to determine if there will be more racetrack sales after they decided to sell 433 acres of California Speedway in Fontana for more than $500 million.
“NASCAR’s decision this year to sell 433 acres of California Speedway in Fontana for more than $500 million (while retaining 90 acres for a possible temporary short track) was a stark example of the shifting dynamics of racing and real estate. It could be a harbinger of more to come, as rising land values, escalating maintenance costs and shifting schedules put added pressure on track operators to make the math work.”
PRI looks at how promoters, sanctioning bodies, and racers are working to ensure open wheel competition remains a vital part of American motorsports by keeping sprint and midget racing costs in check. “The cost of racing, like everything, will continue to go up,” predicted POWRi’s Kenny Brown. “A small percentage can make a living off of it, but racing is a hobby for a majority of the racers. We have to figure out what can we do to help save racers in the future.”
Dragzine explains how Drag Racing is an entertainment dollar bargain. “In simple terms, the NHRA hasn’t raised prices relative to the value of the dollar in 55 years, and has in fact become cheaper relative to that dollar over the last quarter century.”
Dan Rossomondo, Dorna Sports’ commercial director, believes MotoGP ‘can be as good as Formula 1, if not better‘ and hopes to make the series relevant outside of the racing season. “I think we can be uniquely MotoGP. Listen, we’ll steal some ideas from them. We’re not afraid to steal the good ideas, but we’ll have our own good ideas and hopefully they’ll steal some from us.”
Motorsport.com explains how how Veloce transformed itself from an esports team to become a race-winning force in Extreme E. “Veloce had been keen on expanding its presence beyond the virtual realm for some time, but it was only after the launch of Extreme E in 2021 that it found a championship that provided excellent bang-for-buck while keeping costs to a minimum.”
The new owner of Wakefield Park, Steve Shelley, wants to lodge a Development Application (DA) and hopes to re-open the facility later this year. The circuit near Goulburn, New South Wales, was closed indefinitely in September 2022 after a Land and Environment Court ruling imposed tighter noise limits on the venue.
Melbourne’s Avalon Airport has been selected as the preferred site for Victoria’s proposed new Home of Motorsport. “Delivering a Home of Motorsport in Victoria would not only fulfill one of Motorsport Australia’s key infrastructure goals, but it also enables the sport to grow its participation and competition with a reliable state venue,” Motorsport Australia CEO Eugene Arocca said.
Sports media company Religion of Sports (RoS) has acquired UK-based production company Jiva Maya, best known for its Formula 1-focused documentaries such as Senna, Grand Prix Driver and Lucky!. The details of the acquisition are not disclosed.
“According to RoS CEO Ameeth Sankaran, the Jiva Maya acquisition will play an important role in RoS’s expansion into global soccer, cricket and motorsports. It will also help the company as it establishes itself in Europe.”
Motorsport Sponsorship & Partnership News
iSport Connect looks at why IT are the big winners this F1 season. “Over the last nine months, the 10 Formula One teams and F1 itself have signed nearly 14 new sponsors per month. In that period, Information Technology has seen the biggest increase in the number of sponsors (+15), narrowly ahead of Financial Services (+14) and Consumer Goods (+8).”
Here are the latest motorsport sponsorship deals, partnerships and related analysis that were announced this week.
- Metzeler named Isle of Man TT tyre supplier
- Digital Ads Van Strikes Partnership with Team HARD. Racing
- Nascar taps Mixhalo for fan audio experience
- RTVE to air three MotoGP races on free-to-air during 2023 season
- Nascar agrees promotional partnership with Leidos
- Gracie to steer OnlyFans Audi
- DTM extends ServusTV broadcast deal until 2025
- Motorsport UK launches dedicated video platform
- FCP Euro and LIQUI MOLY Expand Partnerships with Lime Rock Park for the IMSA Northeast Grand Prix
The Business of Running a Race Team
BlackBook Motorsport goes “Inside the deal” as they look at how the Porsche Formula E team uses Cato Networks to improve its on-track performance. “The importance of having a data partner in the modern world of motorsport is reiterated by Porsche Motorsport’s head of IT, Friedemann Kurz. He says it is particularly important when the team does not know what level of technological infrastructure to expect when it visits different countries and it can take them up to five hours to set up on site.”
At the end of last weekend’s Long Beach, Dan Towriss was revealed as the co-owner of Andretti Autosport. As per The Drive: “Even if you aren’t into sports, you’ve probably noticed the Gainbridge brand making a lot of buzz over the last four or five years. Led by CEO and president of Group 1001 Dan Towriss, the insurance agency platform has bought the rights to stadiums, sponsored race cars, and perhaps most importantly, become the main sponsor of the Indy 500. Following Andretti Autosport’s phenomenal 1-2-4 finish at the IndyCar Long Beach Grand Prix Sunday, it was revealed that Towriss is now co-owner of the racing outfit, which simultaneously competes in IndyCar, Indy NXT, IMSA, Formula E, Supercars, Extreme E, and other series around the world.”
Sportscar365 has a great article that illustrates how the use of a simulator can help a team competing in real world racing during the actual race, in this case by BMW at the Long Beach Grand Prix. “After FP1 we had some serious issues and we had the guys back in Munich on the DIL (driver-in-the-loop simulator) trying to replicate it and solve them,” he explained. “We re-wrote code between then and now and fixed it.”
The Garage 56 Project has completed its final test before Le Mans. “I feel really good about it,” said the seven-time NASCAR Cup Series champion Jimmie Johnson, who, like Hendrick, will be making his first trip ever to the Le Mans endurance race. “We’ve put in many hours, a lot of work, a lot of collaboration and I feel like we’re in a really good spot. This has been a great test this week, really just working on the small details literally down to things like what color are the buttons on the steering wheel and is the black light inside the car bright enough in the right areas that we can see the dayglow buttons to push at the right time.”
Brit Insurance published a great article on the team they sponsor, Team BRIT. “Team BRIT are a competitive motor racing team. They set themselves aside from the rest of the pack by racing with drivers who are disabled. They are a competitive racing team, not a charity enterprise, and they pit themselves against non-disabled drivers in motorsport races across a number of different classes.”
Zak Brown is weighing a 4th full-time car for Arrow McLaren as well as buying Andretti Autosport’s race shop. “Having seen his newly-expanded IndyCar team get off to such a hot start in 2023, McLaren Racing CEO Zak Brown says he’s mulling the proposition of growth yet again for 2024, in order to potentially keep Felix Rosenqvist onboard beyond the end of this season. But not only is the team’s current shop on Indianapolis’ northside running out of space, after hiring 40 employees for Alexander Rossi’s new full-time entry as they ready to run four cars in May’s Indy 500 for the first time, Arrow McLaren’s plans for a new race shop have stalled, too.”
Porsche Motorsport has instructed its customer GT3 teams to shut off the ABS and TC control systems when running the 992-spec 911 GT3 R on track until further notice, Daily Sportscar has learned. The German marque has moved rapidly to implement a solution to the problem for cars due to race this weekend.
“The background for this is the ongoing analysis of anomalies identified in the wheel speed measurement system, which can lead to the erroneous measurement of the rear wheel speeds, and in turn cause errors in the regulation of the ABS and TC systems.”
Here is a roundup of the latest team news from around the world of motorsport.
- Former title contender HubAuto Racing reveals 2x Porsche GT3 entries
- Hyundai confirms two-car World Tour entry
- Action Express details its plans for Le Mans
- Toro Verde GT expands Porsche programme with two-car Sprint Challenge GB entry
- Lamborghini aims to run two cars at 2024 Le Mans 24 Hours
- Néstor Girolami to contest TCR World Tour in new Honda with ALM Motorsport
- Road Shagger Scales Back Audi TCR Effort After Sebring Crash
Motorsport Movers & Shakers
Experienced motorsport administrator Adam Brook has been announced as the new Venue Manager at South Australia’s Mallala Motorsport Park. “I’m particularly excited to assist in delivering improvement to Mallala, with an eye to growing accessibility to events and overall participation, something I believe is critically important for the future of motorsport in the region.”
This week in the Ignition Book Club they feature Nick Fry’s “Survive. Drive. Win.”
“”Nick Fry’s book “Survive. Drive. Win.” is a memoir that details his journey as a motorsports executive, including his time as CEO of the Honda and Brawn GP Formula One teams. Fry provides an insider’s perspective on the challenges and triumphs of running a Formula One team, as well as the broader trends and issues facing the sport.””Nick Fry’s book “Survive. Drive. Win.” is a memoir that details his journey as a motorsports executive, including his time as CEO of the Honda and Brawn GP Formula One teams. Fry provides an insider’s perspective on the challenges and triumphs of running a Formula One team, as well as the broader trends and issues facing the sport.
Motorsport Prospects Joins the Weekly Motoring Goodness Newsletter!
I am excited to announce that Motorsport Prospects has teamed up with the motorsport-mad folks at Racing Edge to become part of their Weekly Motoring Goodness newsletter! The first edition with content from Motorsport Prospects was part of last week’s April 14th newsletter. You can subscribe here: https://motoringgoodness.beehiiv.com/subscribe
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