The state of Motorsport

[neilap]

Recently Honda decided to pull out of F1 citing economic reasons. At the end of the season there was much brave talk about the 09 season even suggestions of winning races. Well now its obvious that will not come to pass.
Audi and Porsche also decided to leave the LMP1 and LMP2 divisions in the ALMS. This was suspected from much earlier on and confirmed by the end of the season. Audi will compete in the first race, Sebring, and then race at Le Sarthe. Porsche will continue to fund its GT2 program, which by the way seems will be the most competitive of the recent seasons. While prototype racing and open wheel racing is suffering it seems GT racing is thriving. Next year the competition between Porsche and Ferrari will be joined by the new M3 and Corvette racing. GT2 will be the class to watch.
Now recently Subaru has announced its leaving the WRC. This on the tail of the announcement of similar intentions by Suzuki. Again, the economic crisis has been deemed the reason for such moves.
The world of motorsport was we know it is evolving into something I've never witnessed. However, just the way a forest fire breeds new life, I have confidence this change will in the end be a good thing. Many people blame the governing bodies other blame manufacturers. The fact of the matter is that they are both to be blamed. Honda spent more money in f1 last year than any other team but came in an embarrassing 2nd to last. While the other manufacturers in F1 are professing their loyalty, teams are falling off from many other sports and series.
I feel this is a cleansing process. F1 may not lose any more teams but it's definitely a wake up call to all motorsports and to F1 especially. Mad Max may not know how to implement the proper changes but he at least had the forsight that many of the teams and manufacturers lacked.

[old man]

I agree and feel that many oganisers and rule makers may wish to consider how to get full grids, governing bodies consider if there are too many series and a bit more working together is never a bad thing. A bit Darwinian perhaps?

[Gaz]

Honda's decision although a surprise in it's timing in reality wasn't too much of a shock. Japanese board members are going to look at what has been achieved rather than what might be. The cold, hard facts are that Honda have been the worst manufacturer in terms of results over the last 2 years and the company has used the economic crisis as a good reason for not risking another similar season.

As for teams pulling out of WRC and ALMS, well those in my view are the 2 worst run high profile series in the world. Manufacturers are clearly tightening their belts in the present time and deciding they can't afford to support these series in the current climate.

Other series are still doing well and attracting decent numbers, they would be the ones that are consistent and well run. Companies just can't afford to frivel away cash supporting poorly run series anymore.

[BootsOntheSide]

I think the financial slowdown and its resultant hammering on new car sales is producing a special effect. Most major championships had more cars in 2008 than in 2007, while for 2009 only World Superbikes looks set to gain entrants. This is surely the wrong time for yet another championship in between F1 and F3 to be launched, in particular. Honda may have struggled the last two years, but the signs for 2009 looked good, and the people actually running the team didn't seem prepared for a pullout for racing reasons.

[Teretonga]

Subaru is also compromised by the new regulations. The FIA decided it wouldn't allow Gp N cars to run in the WRC. This mean't Subaru would have to homologate a new version of the car at considerable expense. they were not winning and their teams wasn't really a strong title contender against Ford or Citreon. Certainly not without throwing a mountain of money at the car.

So in that light the decision to go isn't a silly one.
They have indicated they may like to come back again in the future perhaps when the regualtions changes have settled down and they decide on what approach they will have in the future.

As for the others... Well the Manufacturers have spent up very large over the last ten years... It couldn't last and was bound to change because the figure s were ridiculous.
12% of the worlds population lives on less than a $1US per day, or less than $400US per year.....
An F1 team was costing $200-400 million a year to run, or what 500,000 to a million people live on...
Meanwhile we have some clown in the US who has defrauded major investors and even European banks (RBS, Santander)to to sum of more than $12 billion by some reports...

[Teretonga]

Actually I have just found a report which says the fraud was $50 billion USD so that is enough to run 125 F1 teams at $400 million a year or 25 teams for 5 years...... or 500 teams at 100 million a year!

On the other hand it would have supported 125 million people at USD$400 for a year... (approximately 750 million people survive on less than a USD$1 a day) It all helps put some things in perspective.

[duke_toaster]

Now is the start of a critical time for motor racing. This critical time has started, but the end will not be this year, or next year, and probably not the year after that.

Motor racing needs two things - survival in the short term, followed by sustainability and stability in the long term.

Survival is keeping grids at a sensible level now. F1 has sensible measures for that (hopefully) - the new engine tweaks and supply price should work, although customer cars would be a good shot in the arm, keeping the current 10 franchises and adding a small number of customer teams.

Sustainability and stability are one and the same. F1 needs to do two things : cut operating costs and keep them down, and make it a big(ger) event on the world stage.

This is where the FIA's 2012 rules need to be sorted. An F1 team should be a profitable enterprise. Road relevancy would be a bonus, but what is needed is large grids - F1 should aim to get ten teams building chassis and about ten or so customer outfits.

[Purist]

However, F1 can't irrevocably compromise its perceived cutting-edge image (as that is what F1 is supposed to be), which means you can only do so much to limit things technically, otherwise you might as well have a spec series using the already available DP-01s or something. Also, road-car relevancy is a rather moot point for F1 since open-wheel road cars don't exist and that ain't likely to change.

Gaz, I don't know much of the WRC situation so I'll leave that alone. As for the ALMS, what should Scott Atherton do or have done? Audi has been doing devastatingly well, and finally has manufacturer competition. If that isn't enough for their sponsors to stick around, then NOTHING would be, period. Porsche North America provided a very good LMP2 car, and to customers at that, but they were caught between a number of obstacles. The ACO doesn't want LMP2 cars winning outright, and the ALMS is obliged to follow that directive to some extent. Also, Porsche has to try to make money on the cars, which did make them rather expensive. Meanwhile, the top privateers running prototypes here don't care to be running where they have no shot at overall contention. Atherton can't make Dyson happy to be playing second fiddle, now can he?

So, what's your solution?

[Kiwi3]

Another issue that I believe is topical is that there are too many championships below F1. How can anyone follow GP2, F2, WSR, Formula Masters, F3 Euroseries, British F3 all at once? It used to be fairly easy to track who the upcoming stars were but it is much more difficult these days as the good drivers are spread across too many series and it is very difficult to make comparisons.

[Peter Mallett]

Originally Posted by Purist

However, F1 can't irrevocably compromise its perceived cutting-edge image (as that is what F1 is supposed to be), which means you can only do so much to limit things technically, otherwise you might as well have a spec series using the already available DP-01s or something.

Um, actually Formula One is the top racing category. You don't need cutting edge technology to race, you need talent, innovation and ingenuity.

That may appear old fashioned but cut out the technology and go back to engines built from materials other than unobtainium etc. and you go a long way to bringing back the main idea of the championship. It doesn't mean spec cars and engines etc. which is frankly a lazy attempt at criticism, it means making the best use of componentry and design talent within a framework rather than a micromanaged ideal.

The economic climate may just make the above more realistic.

[Purist]

Considering we're already limited specifically to 2.4-litre V8s, we're quite a bit closer to spec than you'd care to admit, and we've been slowly going that way for over a decade.

I'm NOT talking about micromanagement, but quite the opposite. Give them a 3.0-litre maximum displacement for naturally-aspirated engines and 1.5-litre displacement for turbos (NO stipulation on number of cylinders). Set a minimum weight and maximum dimensions. Stipulate that the cars must NOT have fenders (as much as I love the '50s streamliners), allow customer cars, and let the teams go nuts.

As crazy as it sounds, it might just reduce costs if everyone is NOT trying to get all the same pieces of the cars that tiny bit better, and having to spend insane sums to get any gain over anyone else.

[Peter Mallett]

Originally Posted by Purist

Considering we're already limited specifically to 2.4-litre V8s, we're quite a bit closer to spec than you'd care to admit, and we've been slowly going that way for over a decade.

Which is my point.

Give them a 3.0-litre maximum displacement for naturally-aspirated engines and 1.5-litre displacement for turbos (NO stipulation on number of cylinders). Set a minimum weight and maximum dimensions. Stipulate that the cars must NOT have fenders (as much as I love the '50s streamliners), allow customer cars, and let the teams go nuts.

I've obviously misunderstood your post because this is what I'm thinking too.

As crazy as it sounds, it might just reduce costs if everyone is NOT trying to get all the same pieces of the cars that tiny bit better, and having to spend insane sums to get any gain over anyone else.

Not crazy to me, it's what Formula One should be.

[Pingguest]

Cost reductions won't make manufactures to stay in motorsports: their motorsport budgets are only a small fraction of the total costs.

The only way to make manufactures to stay or to return as soon as possible to Formula 1, the series should continue to be the ultimate marketing tool. But as television ratings decline in the Western markets Formula 1 is losing its position as ultimate marketing tool.

For the long term, motorsport in general and Formula 1 particularly should look for opportunities the make the cars (the engines for example) more road relevant. This would also have a positive effect of Formula 1 as marketing tool.

[old man]

So we lose manufacturers, so what? That would not stop F1 in itself, the thiings mentioned above may make it posible for privateer teams to enter just so long as they can compete

[foreversideways]

it is reported in the Times today that Toyota are now on the edge of pulling out of F1 and Fords participation in WRC must now be in question with both it's US parent and European operations looking for bale outs. I am beginning to believe now that motor sport and in particular F1 will implode during the first quarter of 2009. The far flung F1 callender is looking increasingly unaffordable let alone the team costs. I would also imagine that CVC's interest payments may overwhelm them shortly.

[Purist]

Not to mention that Bernie has issues with having put his holdings in his (ex)-wife's name to avoid certain taxes.

Toyota pulling out wouldn't surprise me as they and Honda tend to like to beat each other up in the same series. Thus, with one already gone, the other doesn't have its biggest competitor around to smack about.

[Flyin Ryan]

Originally Posted by old man

So we lose manufacturers, so what? That would not stop F1 in itself, the thiings mentioned above may make it posible for privateer teams to enter just so long as they can compete

Are you going to get 10 teams that can afford to take part in an 18-race schedule that races across the world from Australia to Brazil?

[Teretonga]

Originally Posted by Flyin Ryan

Are you going to get 10 teams that can afford to take part in an 18-race schedule that races across the world from Australia to Brazil?

Yes.
It happens in a number of sports and it happens in categories of motorsport, just ones that are not insanely expensive.
F1 wastes monrey simply because they have it to waste. The problem was there was no limit to the insane spending.
Max and Bernie encouraged it when they limited the number of teams and got rid of pre qualifying in the 90's. That meant the main players all became franchises in effect and the value of those fanchises shot up which made people like Eddie Jordan very rich, especially when he sold part of it to Morgan Grenfell.
Then the manufacturers bought into the teams and began pushing up the ante to compete.

Now we have a global melt down after the cost of F1 reached the point of "no way up because we have reached the outer spaces of financial capability..."

Maybe we will get some common sense.
Fourteen teams competed in an FIA GT round in an onscure province of rural Argentina so why wouldn't 12-14 teams compete in an 18 race global contest broadcast live to 3 billion people on the planet with a potential audience of 15-20 million viewers.....

[duke_toaster]

Originally Posted by Purist

Not to mention that Bernie has issues with having put his holdings in his (ex)-wife's name to avoid certain taxes.

Am I the only person who thinks that the SLEC issue could be a positive? I hope Bernie loses a fair bit of his slice of the F1 cake - if FOTA were to buy a large share of the commercial rights (I don't think Slavica would exactly want a big wadge of F1) it would put them in more control. Many of the top sports leagues in the world are better managed by the competitors - in deed, one of the best organized was/is a confederation of owners that started out as an agreement not to pinch each other's players ...

Toyota pulling out wouldn't surprise me as they and Honda tend to like to beat each other up in the same series. Thus, with one already gone, the other doesn't have its biggest competitor around to smack about.

I don't think Toyota would pull out at this time, especially as they performed much better than Honda - they could win races next year, and anyone who thinks Honda had much of a chance was a least misguided, and possibly deluding themselves.

F1's schedule is a issue in a small way, and if the Common Sense Party (FOTA) were to gain more control (See Part 1 of post) they would want to race in their bigger markets : USA not Malaysia for example. That is not much of a cost issue, it's a issue of revenues.

EDIT : Teratonga is right about F1 becoming franchise style ... one way to solve the automatic ante-raising would be severe cost cutting rules plus adding more players (10 teams is a low number for any sports league).

[Flyin Ryan]

Originally Posted by Teretonga

Yes.
It happens in a number of sports and it happens in categories of motorsport, just ones that are not insanely expensive.
F1 wastes monrey simply because they have it to waste. The problem was there was no limit to the insane spending.
Max and Bernie encouraged it when they limited the number of teams and got rid of pre qualifying in the 90's. That meant the main players all became franchises in effect and the value of those fanchises shot up which made people like Eddie Jordan very rich, especially when he sold part of it to Morgan Grenfell.
Then the manufacturers bought into the teams and began pushing up the ante to compete.

Now we have a global melt down after the cost of F1 reached the point of "no way up because we have reached the outer spaces of financial capability..."

Maybe we will get some common sense.
Fourteen teams competed in an FIA GT round in an onscure province of rural Argentina so why wouldn't 12-14 teams compete in an 18 race global contest broadcast live to 3 billion people on the planet with a potential audience of 15-20 million viewers.....

And how many of those FIA GT teams were Argentinian locals or financed by ride buyers? The point of my post was it costs a lot of money for a team based in Britain to send all their equipment and crew to Suzuka. And then turn around not long after and send everyone to Interlagos. Yeah, it worked in the '60s, but this isn't the '60s anymore.

I agree entirely on the franchising. I think it's stupid and makes things a closed shop, which is bad for competition. The spirit of NASCAR would've been even more killed if they went that route.

My idea on lowering costs? Get rid of the rule saying everyone must have their own car. Allow true privateers (not Williams) where an individual can buy a year-old car and run it in three to four events.


For the record, on the Honda and Toyota thing, Honda announced today they lost $1.4 billion in the last 6 months of the year.

[bella]

i think the key for survival for any motorsport is looking for another source of income and finding an area of industry where there are still massive profits. the time of the manufacturer is over for f1, we've had the cigarette era and the car maker era, why not something else?

[Guinness2702]

Originally Posted by Pingguest

But as television ratings decline in the Western markets Formula 1 is losing its position as ultimate marketing tool.

Are they declining? I can't speak for the Netherlands, but I was under the impression that here in the UK they had been increasing in recent years, and in my inexpert opinion they will increase further, now that F1 is back on the BBC.

[old man]

Some intersting points in a thread to discuss the state of Motorsport that has become the state of F1, If I may:

Duke_toaster; I think you would find that Salvica owns Bernies money, not F1, that, FOM, as I understand it is owned by CVC, a venture capital company with a big debt to the banks. For them it is essential that the show goes on because that is the only way they get their money back

What beacame FOM was originally a company made up of all the F1 teams when Bernie organised them to get a better deal from the circuits, when this was set up it was with Max as the legal guy. Just how he managed to get full control is a bit of a mystery to me but the participants did run the series with the FIA, especially after Bernie got Max into the FIA

Flyin Ryan asks how new teams will be able to afford to go to the fly away races: The same way that the FIA GT teams went, their costs would largely be covered by the circuits, in the case of F1 through the agreements with FOM and the TV rights money. If FOM do not provide a full grid (not sure what the minimum number is, does anybody know?) they are in breach. Travel fund at the moment is according to points from the previous year but I am sure adeal would be done if it ensures the show goes on

Bella is right, they must look for new sources of revenue but this is going to be hard next year, where do they start?

Other areas of motorsport need to look at consolidation, too many championships at all levels IMO

[JP Sarti]

While I'd love to see privateers back in F-1, I wonder how practical this is now that Bernie's sold the soul of racing to the manufacturers.

Let's make a comparison against other sports. Imagine that rich individual or group of individuals from the Middle East, Asia or India. What's the cost of just one season of racing, even in a cost cutting environment? Compare that with the cost of acquiring a Premiership team; that'll give you plenty of exposure (you'll be in the tabloids every day whether you want to be or not). Cost of a Premiership team? Well there's a one going for around GBP150-250 million and another for somethng north of that (both geographically and financialy). But that comes with some assets, a fan base, and a pretty lucrative global TV contract and that's the purchase price, not the year-on-year cost.

Now I'm not trying to make a soccer vz. F1 debate here all I'm saying is that you can throw a lot of money at F-1 and still run around at the back way off of the pace. People see investments in sports franchises as a business these days, and the problem is that Bernie has so leveraged the cost to get in that it's going to be a struggle to find replacements to those that drop out.

The harsh reality is that if you're an auto maker these days image through F-1 may help a bit, but the truth is that in the current world people are changing their priorities. Frugal is in, glamour is out.

[JimW]

Hi Neilap

Actually I think the Thread title is misleading. F1 is not Motorsport; Motorsport is not F1

Regards

Jim