Formula One race organisers plead for coronavirus financial aid from owners of the sport

Formula One race organisers have called on the owners of the sport to offer financial aid in order to meet their ambitious target of starting the season in summer and hosting as many as 18 races.

F1 has been in a spin since it was forced to give the red light to its season-opener in Australia three weeks ago when a member of the McLaren team tested positive for Covid-19. It led to the sport cancelling or postponing its first eight races including the Monaco Grand Prix which will not take place this year for the first time in more than six decades.

F1 initially said that the season would re-start in May but last week it pushed it even further back. In a statement F1 said that it still plans to hold “between 15-18 races” this year but didn’t say when the season-opener would begin. Instead it said that it will get underway “at some point this summer” and it has left some of the race organisers fuming.

“They have to be willing to accept lower fees if they want their promoters to be healthy,” says one of F1’s race organisers. He explains that they are in a Catch 22 as they need to order equipment to ensure that their races can go ahead but they lack the funding to do so. It usually comes from advance ticket sales but they have crashed because fans don’t know if they will be able to travel or if the races will take place.

“We reserve hundreds of buses which have to be booked 90 days before the race and have cancellation fees,” says the organiser. “We have another contract for the traffic because we hire hundreds of police officers over the race weekend and there are cancellation penalties for that too. Then there’s the setting up of all the temporary grandstands and hospitality tents which are ordered and negotiated six to eight months before the race and are set up 60 to 90 days ahead of it. Once the race is six weeks away we are spending more than a million euros a week to prepare.”

In previous years it has been fuelled by advance ticket sales. “We usually sell most of our tickets now,” says the race organiser. “Most of the sales are to out of town visitors and they don’t usually make last minute plans. Around 80% of them book more than four months ahead. So the key selling time for us is now.” It isn’t alone.

The Azerbaijan Grand Prix is one of the races waiting to be rescheduled and its organiser Arif Rahimov says that tickets to some of them may have to be on sale “for shorter periods of time. I know, for instance, that some promoters start next race sales immediately after their event. This means that they would have missed 3 to 6 months of sales during the period of uncertainty.” It has already made a hefty dent.

Ariane Frank-Meulenbelt, managing director of officially-licensed F1 ticket agency GPTicketshop, says that “ticket sales are down, not only down but have stopped all together for all motorsport events worldwide. Understandably people have other things to worry about than F1 or MotoGP and also no one knows when and where we will start racing again and how soon free travel will return.

“This, in combination with an economic shutdown worldwide, is not an ideal scenario for ticket sales. None the less we remain optimistic that once the pandemic slows down or is over we will return to normal sales figures, whether this will be latter half of 2020 or only in 2021 remains to be seen.” Uncertainty over the upcoming race dates isn’t the only driving force behind the slowdown.

Another F1 organiser says that “one of the things that the later races can benefit from is excitement and awareness in the early part of the season. We rely on people getting excited about it when they see it on TV. Australia does a lot of good for us. Once the season starts to get going people start paying attention but if you don’t have the season no one will be paying attention. If the season doesn’t kick off until July the interest just won’t be the same. All those races leading up are complementary to our race.”

Reversing ticket sales don’t just make it harder for organisers to fund the preparation for races but also to pay the fees for them. They come to an average of £22.8m annually and are the second-biggest source of revenue to F1’s owner Liberty Media. One of the organisers says that Liberty may have to accept lower fees in order for its races to get the green light.

“F1 is attracting lower ticket sales so they should take a lesser fee. If our revenue is down by from last year, we would like F1 to absorb the amount we are down by. They should just adjust the fee by that amount and if it goes up they can have more.”

Another of his counterparts endorses the plan and describes it as “blindingly obvious.” He adds that “people need to make arrangements to go to a race, ask for days off, book hotels if visiting from another country, etc. I think cancelling this year altogether will be the only way much as I would regret it.” It may prove to be inevitable.

Taking the summer start date as being the middle of August, one race would have to take place every weekend until the middle of December in order to fit in 18. That doesn’t just require the 18 countries to be free from coronavirus but also the UK, Italy and Switzerland as the teams are based there. After the debacle in Australia, where F1 was perceived as having brought a case of coronavirus into the country, future race hosts probably won’t take any chances.

It only took one case of coronavirus to bring the Australian Grand Prix to a grinding halt so it is likely that the teams’ home countries will have to be completely clear next time. However, given that the UK, Italy and Switzerland currently have more than 120,000 active coronavirus cases it could take far longer than the middle of August for them to be ready.

It explains why race organisers are concerned about F1’s claim that the season is on track to start in summer and one of them says that it may be “better off not having the event. Cancel it far in advance so that I don’t spend money on people and set up and then find out that it is cancelled. That’s the worst case scenario.

“An Australia type incident for us would cause bankruptcy because we will have spent millions already. The ticket refunds are what would kill us. We take money from fans and go out and start buying grandstands with it because you have got to build the spectators their seats. If the race gets cancelled all of a sudden, the grandstands are sitting there and you have got to give refunds so you are screwed.”

Rahimov says he has taken steps to prevent this from happening as has “an agreement with F1 that we will only confirm our date in the calendar once the threat of another cancellation is past. Moreover, we would need at least a 10 to 12 week lead time to be able to prepare for the race.” Time will tell whether it gets to the finish line