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Race promoters to put further squeeze on F1 teams?

NEWS STORY
23/01/2018

If ever proof were needed that Britain remains at the heart of Formula One, one needs look no further than last week when a number of high level meetings took place in London.

One of these meetings saw a rare gathering of the Formula One Promoters Association (FOPA) the organisation which represents the interests of circuit owners and race promoters.

Like many, it's fair to say that the promoters are not happy, for other than the prospect of another year of Mercedes domination there is the little matter of race fees and the annual increment.

Though France and Germany return to the calendar this year, 2017 witnessed the final Grand Prix in Malaysia, while the owners of Silverstone, the British Racing Drivers' Club (BRDC) have opted to end their contact for the British Grand Prix after 2019 and there remains a worrying asterisk against the Circuit of the Americas entry on this year's calendar.

Of course, some promoters have more to complain about than others. While Monaco doesn't have to pay any fees to host its event and Silverstone gets a number of 'incentives', others have to rely on government subsidies and pop concerts in order to pay the bills.

All of which isn't helped by the fact that with no significant changes to the regulations until 2021, Mercedes domination is likely to continue.

On average, the promoters pay 22.3m ($31.1m) but as we said previously the fees vary from event to event with Monaco paying nothing and Abu Dhabi a reported 54m ($75m), not forgetting the annual 5% increment.

In 2016, race hosting fees contributed 470m ($653m) to the sport's coffers which represented the biggest slice of F1's 1.2bn ($1.8bn) revenue according to the latest accounts.

At a time the teams and engine manufacturers are going head to head with the sport's new owners, and not forgetting that little matter of Liberty's plans for how the prize pot will be divided as the sport moves forward, so too the race promoters are squaring up for a potential stand-off.

Indeed, one source close to FOPA tells the Telegraph that at a time a significant number of new contracts have yet to be agreed, there will be no such deals unless Liberty is willing to renegotiate.

"No contract will be renewed under the existing financial conditions," said the source. "We are talking about a reduction in fee for sure.

"It is impossible to pay the kind of money that most of us pay," they added. "So the overall gist is that it is too much for what the promoter is getting."

Already facing a drop in revenue of 5.9% to 467m ($650m) with the threat of continued falls over the next couple of years, the teams are already restless, and at a time various factors have seen the sport's operating loss double to 50m ($70m) the thought of taking a further hit due to the demands of the promoters will only further muddy the waters.

While Malaysia has ditched F1 it retains MotoGP, organisers claiming that the so-called pinnacle of motor sport doesn't offer anything like the same level of entertainment, pointing to falling race attendance and viewing figures as proof.

Referring to the meeting, the source told the Telegraph. "It comes down to a very simple issue and that is can the product be improved or not?

"On that point, Ross Brawn was, sort of, very clear and very objective, and he said, we are working on it, there will be some aerodynamic changes which will take 2019 and 2020 to develop and introduce. He would not comment on the engine formula. He said it is a very complicated negotiation as everybody knows. He is doing his best. That's all he can do can't he.

"Otherwise it was a standard American presentation sequence. Every department demonstrated what they do and how they do it. It was perfectly professional and fine. That's about it.

"It is very, very clear that every contract is different and it could be pointless to try to make a collective negotiation. There will be absolutely no collective negotiation on the price," warned the source. "There shouldn't be. Every condition is different. Every country is different. Some people have government money, some people don't.

"The overall gist is that it is too much for what the promoter is getting. Now, if the product improves, and it might easily in the next two or three years, it's a different story."

While there cannot be any changes to the engine formula before 2021, the aerodynamic changes mentioned by Brawn are for the most part cosmetic and, and as previously reported, aimed more at improving sponsor visibility rather than racing. Indeed, a call to simplify the front wings, one of the main reasons why overtaking fell by around 50% last year, was dismissed.

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READERS COMMENTS

 

1. Posted by TokyoAussie, 25/01/2018 3:38

"Promoters bargaining as a unit (well, actually the lack of) has been a sticking point of mine for yonks. They are so entirely feckless that I wasn't aware that "FOPA" even existed. Or they were so out of the news that I forgot that they existed. Still feckless.

I've been watching F1 since 1979 or 1980, if memory serves. I'm addicted, so I'll probably pony up again this year to watch, but it's really getting harder to justify. In 2017, the timing app alone cost an arm and a leg (and pulled hair when it didn't function). F1 is the only thing I watch on the TV channel that broadcasts it here in Japan (Fuji NEXT). While I don't expect the TV channel subscription to change, I fear for the cost of the timing app, especially if it includes a low-res video feed. I gave up attending F1 (Suzuka) about 10 years ago because ticket prices are just ridiculous now.

With reduced gaps between tyre specifications (because there's more of them) and those god-awful front wings stuffing everything up (no change there), I don't see how 2018 can possibly have closer racing than 2017. And now there are roll hoops blocking the driver's vision and the vision of the driver (by us), I really can't see this year being anything positive. And it pains me to say that.

"

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2. Posted by meatball, 22/01/2018 19:16

"How many more nails does this coffin need?"

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3. Posted by Pete, 22/01/2018 17:01

"I'm not surprised that the most boring race, make that procession, on the calendar is free!!!"

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4. Posted by raven49, 22/01/2018 15:30

"After attending F1 in the US many years ago and watching for several decades, the "changes" are not encouraging. I started watching MotoGp last year and find it much more interesting from the visual impact of the racing to the announcers. In F1, here, we have Leigh Diffey, Steve Machett, David Hobbs and Will Buxton.
They have become terrible as a group although Will Buxton has emerged as most informative. When Steve Marchett does a technical discussion it is the only interesting part of the pre-race show. The announcing is terrible containing phrases like "push.push, boy" from the slurring words of Hobbs. As a group they refuse to give information as to speeds and times in sectors in critical stages of the race, such as before and immediately after pit stops. They lie completely when the pretend that Vettel might make up 15 seconds on Hamilton in the last ten laps of a race when he is lapping a tenth quicker.
As for Liberty's changes - Liberty is about money. Nothing else, money. They spent way to much time on a logo which may even get them sued by 3M. Taking money from the people that actually make and race the cars for dubious investments can't work for too long. The smaller outfits already can't compete evenly.
Upcoming changes to the regulations will require expense on the part of the engine manufacturers and will spread down the grid. The racing is now fully two tier with the smaller teams only having a chance in a monsoon with the race cut short. That is always going to be an issue with the most money providing the most result. I don't favor caps because there are still ways around them but there is lots of money going to Liberty for ????(oh yes, nothing).
If they're worried about noise, why not just play some through the announcing apparatus at the tracks the way Ford, Lexus, Audi and others pipe engine sounds through the Bang and Olufsen speakers.
The FIA certainly isn't going in the right direction either. I see a thread in all this and it is that egos from the FIA and FOM down are involved. Those egos will ruin the sport."

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5. Posted by Joop deBruin, 22/01/2018 13:10

""On that point, Ross Brawn was, sort of, very clear and very objective". Hmmmm, so he was, sort of, NOT very clear?"

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6. Posted by itcatip, 22/01/2018 12:38

"Don’t want to see F1 cars with rollcages so I’ll spend my time in 2018 watching Indycar, Moto GP and Superbikes instead."

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7. Posted by bfairey, 22/01/2018 11:04

"I'm at the point of downsizing my TV contract so I wont be watching F1 in the future, but I dont think I will miss much. Its possible that I will come back IF the cars change but I dont think so."

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