Who is in charge of Formula 1? That should have a relatively straightforward answer but based on the back and forth this week between the FIA and Liberty Media, most fans and possibly the teams and Liberty Media themselves may not be quite so sure of the answer.
In addition to the FIA/Liberty war of words, I have news on how Las Vegas Grand Prix organizers expect the race to dwarf the Super Bowl in terms of revenue, how Hyundai is not going to Formula 1 (right now), why the World Rally Championship feels that their best years are ahead of them and how IMSA is gearing up for a new golden age but are looking for more American drivers.
I also have the latest motorsport sponsorship deals and partnerships, how Michael Andretti is aiming for world domination in motorsport and BMW’s return to prototype racing.
All this and more in this week’s Business of Motorsport Roundup on Motorsport Prospects. Its news racers can use.
Motorsport Industry News
The current tension between the FIA and commercial owner Liberty Media has been ratcheted up in recent days due to a Bloomberg report stating that Formula 1 is now worth $20 Billion USD. When FIA President Mohammed Ben Sulayem wrote on his personal social media page that this valuation was suspect, the negative reaction by Liberty Media (and therefore the teams) was swift.
The governance and operating of Formula 1 is a complex operation both legally and logistically. The fact that essentially two entities “run” Formula 1 has led to a number of run-ins and conflicts and that does not look like ending anytime soon. There are even whispers once again of a breakaway series although nobody sees that as at all likely for the time being. The last attempt was the Grand Prix World Championship in 2010 and that ended in a whimper.
Is this a true crisis or merely a kerfuffle as long time F1 writer Joe Saward prefers to call it. For sure there are legal implications about commenting publicly on the valuation of a public company, but it is clear that the current relationship between the two entities is muddled at best and antagonistic at worse. But it is a necessary relationship, one as regulator and one as commercial rights holder. What role do the FIA play in approving who buys the commercial rights of F1? Why is an agreement between a major public company and a non-profit sporting organization not public? Can the FIA comment on any commercial aspect of the operation of F1? Who actually owns Formula 1? All these questions remain unanswered in the murky world that is the business of Formula 1.
Interestingly, in naming Liberty Media the World’s Most Valuable Sports Empire, Forbes values F1 at $17.1 billion, not the $20 Billion mentioned in the Bloomberg report.
Here is a sampling of the coverage of the current state of conflict between Liberty and the FIA. There are some great articles on the structure of the agreement, the legalities of running the sport as well as the governance of F1. Happy reading.
- Saudi Arabia Explored Bid to Buy F1 for Over $20 Billion (Bloomberg)
- Saudi Arabia Reportedly Wants to Buy F1 for Over $20B (Front Office Sports)
- Report: F1 owner rejects multi-billion dollar takeover offer from Saudi PIF (Sports Pro Media)
- Saudi Arabia Public Investment Fund that Started LIV Golf Tour Targeting Formula 1 (AutoWeek)
- Ben Sulayem urges caution over “exaggerated” $20bn valuation for F1 (Autosport)
- Ben Sulayem’s curious warning over $20bn F1 price tag (The Race)
- Analysis: F1’s ‘Don King Clause’ could block sale of F1’s rights (Racing News 365)
- Reports: F1 issues letter in response to Mohammed Ben Sulayem’s ‘major overstep’ (Planet F1)
- F1 chiefs angered by Ben Sulayem’s “unacceptable” remarks (Autosport)
- F1 fires legal warning at FIA for Ben Sulayem tweets (Racer)
- F1’s severe response means Ben Sulayem has crossed a line (The Race)
- ‘Who takes the blame? Us’ – Mohammed Ben Sulayem fumes at lack of ‘fairness’
- Formula 1, Liberty Media Threaten Legal Action Over FIA Tweets (Front Office Sports)
- Kerfuffles and Transparency (Joe Saward)
- What next for F1 after FOM’s broadside to Ben Sulayem (Autosport)
- FIA president reminds F1 bosses: ‘The championship is ours, we have only rented it out’ (Planet F1)
- Opinion: Why F1 could face major competition (Racing News 365)
- FIA president Ben Sulayem was “sucked into F1” last year. Will that change in 2023? (RaceFans)
- One easy way the FIA could instantly improve F1 (Autosport Plus)
- Braves, F1 Owner Tops Forbes’ Most Valuable Sports Empires (Front Office Sports)
- The World’s Most Valuable Sports Empires 2023 (Forbes)
In the latest developments in the Andretti/GM F1 bid, Andretti indicates that they want to be on the F1 grid by 2025 but they better get moving as time is becoming a factor in his F1 bid. GM has explained why they seem to finally want an F1 team while embattled FIA President Mohammed Ben Sulayem continues his campaign to see Andretti and GM join the F1 grid. Meanwhile Christian Horner explains the F1 teams’ opposition to Andretti Cadillac’s proposal. “You can understand the FIA, they’ve got no financial consequence of this because they don’t participate in the prize fund, and they’d receive further entry fees for more teams coming in. So you can understand the FIA potentially wanting more teams on the grid. But I think they need to find alignment with the commercial rights holder, and the 2026 Concorde Agreement would seem the right place to deal with that.”
Interestingly, the FIA President has stated that only Andretti has expressed interest in joining the F1 grid (which has not been formally submitted), despite both Panthera Team Asia and Hong Kong businessman Calvin Lo stating their interest. Traced News looks at who is behind Panthera Asia F1.
Ford is still sniffing around Formula 1. “As a company we go racing for innovation, tech transfer, the learning opportunity, but also for marketing reasons as well. It’s shifted for sure, and it definitely requires consideration.”
Huddle Up looks at the incredible logistics of Formula 1. “Teams will start working with F1’s logistical partner DHL up to 18 months before each race. DHL has been working with F1 for nearly 40 years, and they have a team of 35 dedicated specialists that travel to every race to oversee transport, setup, breakdown, and packing.”
Hyundai’s new motorsport team principal Cyril Abiteboul has moved to quash rumors that the company could be set for a future venture into Formula 1. “There is no particular plan [to enter F1,” Abiteboul said, as quoted by Autosport. “Clearly, Hyundai is a company that is hot for a fantastic development at a global scale, with a new product line-up, a unique range and so on and so forth. And motorsport is here to support the business. So, I need to understand, with the rest of the company, what the business needs, and how we can support it right now. I want to go back to my previous answer. We need to make sure it serves the business. Right now, rally is serving the business, and the priority is to make sure that it stays like that, working with the FIA and the promoters. If we need to do something else, in addition, we will see it in due course. But that’s not the priority for now. The priority is winning in rally.”
Some interesting Grand Prix-related news this week. Miami Grand Prix organizers have increased seating capacity by 3000 due to increased demand while Las Vegas Grand Prix organizers expect to generate $1.3 billion in revenue, doubling that of the Super Bowl according to Front Office Sports. That sum includes a projected $966 million in visitor spending and $316 million in event operations and support.
Despite the F1 season starting with back-to-back races in the Middle East, Saudi Motorsport Company CEO Martin Whitaker isn’t at all worried about the market becoming saturated. “Actually, while it might seem close, the distance between Bahrain and Jeddah is about 1,500km further than the distance between Silverstone and Budapest [2,000km] and there are a lot of races that are held between these two European venues. So the location of the races in the Middle East are not as close as you think.”
With all these new races, Toto Wolff cautions that F1 must avoid the mistake of oversaturation as popularity grows. “One should never believe that a trend will continue indefinitely,” he told Auto Motor und Sport. “That depends on how much entertainment we offer further down the track. Which personalities in Formula 1 grow up that trigger sympathies or polarise. Both are good. At the same time, we must not make the mistake of oversaturation. But these are all subjects we are considering. What remains for me as a skeptic: We should always remain cautious. Formula 1 is doing very well at the moment. It can always become better. But it can also happen that the audience’s interest subsides if we don’t entertain well enough.”
General Motorsport Industry News
The World Rally Championship argues that its house is not on fire with only three manufacturers and that they are confident its 2025 Rally1 rules evolution can entice new manufacturers to the series. “We need to do more with the hybrid, we know. I think it needs to be a bit of louder part of our championship, particularly EV mode, and we need to make it a bit more of a dominant part in the sporting competition as well. That hybrid [unit] still has actual capacity left in it in terms of battery and greater regen. We can see whether we can increase boost and relevance through road sections on EV mode.”
Sportscar 365 conducted a Q&A with Pascal Zurlinden, Director of Performance Engineering at Multimatic Special Vehicle Operations, about Multimatic’s involvement in the new era of sports car racing with Porsche. “We are one of the four chosen chassis suppliers. Car manufacturers can choose which of the four will create the “spine” of their car and we were honored to be chosen by Porsche, who have named their car the Porsche 963. As part of the spine, we will also provide Porsche with the latest Multimatic DSSV dampers designed for racing prototypes.”
As IMSA highlights the global reach of their series due to the vast array of manufacturers and drivers, they appear to be struggling in attracting and retaining American drivers in their top GTP class, a fact recognized by IMSA president John Doonan. “I can tell you we’re going to be doing more of that in coming weeks and months to make sure that young talent, even in the karting ranks and grass roots club racing, understand what’s available to them coming forward,” said Doonan. “You can look at the list of drivers who made sports car racing into sustainable careers and it is possible for these drivers. It’s incumbent upon us to make it clear.”
Aston Martin’s multiple championship-winning Vantage begins the defense of its IMSA WeatherTech SportsCar Championship GTD class title this weekend, as three teams (including the 2022 IMSA GTD class champions Heart of Racing) field four Vantage GT3s in North America’s most famous endurance race – the season-opening Rolex 24 Hours at Daytona (FL). Moreover, as Aston Martin celebrates its 110th anniversary year, it will kick-off its endurance racing calendar with a record 12 Vantages competing over the Rolex 24 weekend, including no less than eight Vantage GT4s contesting the IMSA Michelin Pilot Challenge support race on Friday. This four-hour season-opener also marks a title defence for Vantage GT4, which won the championship with Volt Racing in 2022.
Autosport Plus goes inside BMW’s long-awaited prototype racing return. “Much like German OEM rival Porsche, BMW’s absence from sportscar racing’s top flight will be ended this weekend when a pair of M Hybrid V8 prototypes make their debut in the Daytona 24 Hours. A programme focused on the IMSA SportsCar Championship for now will expand to the World Endurance Championship and Le Mans next year, in a sign of both its ambition and pragmatism.”
A number of race track-related developments occurred this week from around the world. In Germany, the 21-kilometre-long Nordschleife is set to benefit from an 11 million Euro investment in state-of-the-art digital communications, HD trackside cameras and safety warning systems. In Australia, New South Wales Opposition Leader Chris Minns has pledged $1 million in a bid to save the embattled Wakefield Park if he wins government in March. Finally in the United States, a few steps are still required before reopening Hub City Dragway in Hattiesburg, Mississippi.
Check out the above video of Girls on Track at a recent all day event at University College London with support from Ignite Partnership.
Sunday Group Management have announced that Erin Cechal has joined the company ahead of the 2023 season as Account Manager for the firm. The appointment follows Sunday Group Management’s acquisition of Layer Cake Media LLC, which Cechal first founded in 2013. Layer Cake supported a range of client programs including Porsche Motorsport North America’s championship-winning factory GTLM effort in IMSA, CORE Autosport’s championship-winning campaigns, as well as the SRO America program for RealTime Racing. Sunday Group Management provides media relations management, video production services, as well as social and digital media solutions for race teams, drivers, tracks, OEM manufacturers, and tracks.
Formula Scout looks at the factors that ended ADAC F4, and left much of German racing at risk. At that time, the ADAC attributed much of the decline to young drivers’ insistence on racing on Formula 1 tracks rather than some of the less attractive German venues which are scantly seen in series higher up the single-seater ladder than F4. Niessink admits that “we cannot attract clients to decide in favour of Sachsenring, Oschersleben or Lausitzring; they simply don’t want to drive there”.
Roland Dane asks, Is there a case for a Cost Cap in Supercars? Formula One introduced its Cost Cap for the 2021 season in order to try to level up the competitive playing field as well as ensuring that more teams are profitable (or at least making smaller losses!) and therefore more sustainable in any future economic downturn. Would the same course of action now make sense for Supercars?
BlackBook Motorsport have announced that early-bird registration is now open for the 2023 BlackBook Motorsport Forum. “The BlackBook Motorsport Forum is the flagship business event for stakeholders in global motorsport. Established as the only event bringing racing promoters, teams, sponsors, brands, OEMs and key services together, the 9th edition Forum combines insightful sessions with industry-leading networking opportunities.”
Motorsport Sponsorship & Partnership News
Here are the latest motorsport sponsorship deals and partnerships that were announced this week.
- Avalanche Andretti Formula E Announces Partnership with Prysmian Group
- TARSHID continues its partnership with Formula E for the Diriyah races
- EBMX to be Official Supplier to FIM E-Xplorer World Cup
- Lifestyle brand CORE named Title Sponsor of the 2023 CORE Diriyah E-Prix
- Kustom Entertainment, Inc., a Digital Ally Subsidiary, to Be Primary Sponsor of Harvey’s Entry for Seven INDYCAR Races in a Multi-Year Agreement
- WRC signs two-year broadcast extension with ServusTV
- Formula One signs helmet camera agreement with Racing Force Group
- Nascar secures Cabo Wabo as first tequila sponsor
- Formula 1 and beIN SPORTS announce multi-year partnership to exclusively broadcast F1 in 10 territories across Asia
- Kubica out of F1 as Orlen moves to AlphaTauri and Alfa Romeo lands new sponsor
The Business of Running a Race Team
According to AutoWeek, Michael Andretti wants world racing domination, and that includes Le Mans and the WEC in addition to Formula 1. “Our goal is to be in every major racing event in the world and Le Mans is one of the big ones, so down the road we definitely want to be there,” said Michael Andretti in a media conference prior to WeatherTech Championship qualifying for the Rolex 24.”
Williams received a £36million investment 10 days after the exits of former team principal Jost Capito and technical director Francois-Xavier Demaison were announced in December. “The specific £36m investment in December may have been inevitable regardless of the dramatic double exit of Capito and FX, especially if it was just tied to cashflow management. If so, it still ties in neatly to the tempting conclusion that Dorilton’s interest in Williams actually increased rather than waned in 2022, in response to the problems it identified with the senior management.”
Frédéric Vasseur, Team Principal and Managing Director at Scuderia Ferrari, explains the challenges of Formula 1 in an interview with Racecar Engineering. “The weight of teamwork is much more important than the weight of individuals nowadays, much more so than it was just a few years ago. It is more a matter of team achievement because the large size of the teams requires more coordination within the departments. A single person’s influence is less, but that isn’t to say they are less critical because they are now more specialised than ever.”
The potential of having the Acura ARX-06 compete in the FIA World Endurance Championship would be a global Honda decision according to Honda Performance Development President David Salters, who has reaffirmed Acura/HPD’s position, which remains unchanged. “Acura is North America; we need to do a good job here,” Salters said. “So far so good. That is what’s Acura is doing. If we go outside and look at different series with this car — WEC — that’s down to Honda. It’s not changed.”
Moto2 team Forward Racing has announced an unexpected split with historic Italian manufacturer MV Agusta only weeks before the start of the 2023 season. The partnership between the two, which stretches back to 2019, is ending due to what the team cited as ‘economic demands’ from the factory.
AO Racing has yet to fully decide how it will handle the two date clashes between the IMSA WeatherTech SportsCar Championship and FIA World Endurance Championship according to the team’s director of motorsport Gunnar Jeannette. “There’s a couple of clashes that we’re still sort of working through exactly how we can manage that,” director of motorsport Gunnar Jeannette told Sportscar365.
California-based motorsport company Forte Racing is to participate in the 2023 IMSA WeatherTech Sportscar Championship in the #78 Lamborghini Huracán GT3 EVO2. The new team will enter the series supported by Arrow Electronics and led by veteran open-wheel and sportscar team owner Shane Seneviratne and his championship-winning infrastructure at US RaceTronics (USRT). They are also partnering with O’Gara Coach.
JCM Racing and Tim Wilkerson Racing have partnered to create Maynard Wilkerson Racing (MWR). NHRA Funny Car driver Tim Wilkerson and JCM Racing team owner Joe Maynard will serve as co-owners of Wilkerson’s Funny Car operation, which will compete under the MWR banner and add JCM Racing partner SCAG Power Equipment as its primary sponsor.
Leading junior outfit Carlin has taken on fresh ownership courtesy of Rodin Cars, with the team structure to remain unchanged. Rodin Cars, through Australian businessman David Dicker, has now become the majority shareholder in Carlin, and the team will race under the rebranded name of Rodin Carlin.
Motorsport Movers & Shakers
Gary Paffett has been announced as sporting director for McLaren’s Extreme E team, a position he will fill alongside his team manager role in the company’s Formula E squad.
Zak Brown has been interviewed on the Car Stories Podcast. Zak Brown was born and raised in Southern California. He raced professionally around the world for 10 years before developing his skills in motorsport’s business and commercial worlds. In 1995, he founded JMI, which grew to become the largest and most successful motorsport marketing agency in the world. When JMI was acquired by CSM, a division of Chime Communications, in 2013, Brown became the company’s Chief Executive Officer. In 2016, Brown was announced as executive director of McLaren Technology Group. In 2018, Brown became the chief executive officer of McLaren Racing as part of an operational restructure of the McLaren Group.You can listen to the interview here.
The Alfa Romeo Formula One team has appointed current managing director Alessandro Alunni Bravi will act as a team representative, forgoing a traditional team principal. Bravi will also represent team away from the track at all official functions