Is F1 in the US done?

[Ruffdaddy]

First the COTA CEO gets the boot because the track wants to take it in a different direction, and now the state cuts funding. Will the US F1 race be cut?

http://www.mystatesman.com/news/news/state-regional/why-the-future-of-austins-f1-race-is-in-doubt/npKxM/

[BoostedD1]

I hope not. We need f1 in the US for sure.

[David]

i hope so.

[slow99]

Waiting on confirmation from grape.

[svauto-erotic855]

If a race can not happen without government money then it doesn't need to be happening at all.

[Grimpala]

If a race can not happen without government money then it doesn't need to be happening at all.

This. Why the F are we subsidizing a multi million dollar sport?

[Ruffdaddy]

I hope not. We need f1 in the US for sure.

Define need...

Waiting on confirmation from grape.

Haha, i was thinking the exact same thing when i posted it.

If a race can not happen without government money then it doesn't need to be happening at all.

I mostly agree with this. Its amazing that the state gives COTA $28MM and they still lose money every year. All i really care to see is NASCAR/INDY race there and motogp. The government only pitches in about $1MM for those races, and thats more to ensure the state hosts the race and not someone else (this getting tax revenue).

[ktm300hater]

If a race can not happen without government money then it doesn't need to be happening at all.

Is this the first intelligent thing you've ever said on here?

[Ruffdaddy]

This. Why the F are we subsidizing a multi million dollar sport?

For tax revenue. But the difference here is that F1 costs $28MM whereas NASCAR costs like $1.8MM.

[Strychnine]

For tax revenue. But the difference here is that F1 costs $28MM whereas NASCAR costs like $1.8MM.

I think TX gives NASCAR around $1MM and X-Games around $1.5MM.


The state is only talking about cutting back $5.5MM on the F1 thing. Not all of it. Bernie could go dig in the pockets in his coat closet and probably find that much.

F1's total revenue is around $1B per year.

The ultimate parent company of F1 is Delta Topco which is based on the offshore island of Jersey. Its biggest shareholder is the private equity firm CVC which has a 35% stake in it. The second-largest shareholder is American asset management firm Waddell & Reed, which has 20.9%, followed by the estate of bankrupt investment bank Lehman Brothers with 12.3%. Bambino Holdings, the Ecclestone family trust, owns 8.5% with 5.3% in Mr Ecclestone’s hands and the remainder held by other banks, funds and management. There is a mighty financial engine beating at the heart of the business.

Topco’s revenue comes from six sources. Starting at the bottom, sales of vending and concession stands at tracks brought in $33.9 million in 2013, the latest year for which accounts are available. Junior series GP2 made a total of $34.1 million from selling cars and parts to its teams whilst F1’s corporate hospitality outfit the Paddock Club had revenue of $87.8 million.

Next up is $259 million from selling trackside advertising at each race and sponsorship of the series. This comes from companies such as parcel delivery service DHL and luxury watch maker Rolex which are both official F1 partners. The two remaining sources of F1’s revenue are the biggest – fees from hosting and broadcasting races. They each bring in roughly the same amount and in 2013 it came to a combined $1.3 billion.

In 1995 Mr Ecclestone took a salary of $90 million from FOPA which made him the world’s highest-paid executive. However, at the end of the year he was handed the keys to the billionaire’s club when F1’s governing body, the Fédération Internationale de l’Automobile (FIA), awarded his company the rights to run F1 rather than just broker the deals.

Since then, Mr Ecclestone has built up a fortune of around $4 billion from selling stakes in the sport.

F1’s biggest pay-day is believed to have come from the contract with German broadcaster RTL which was signed by Mr Ecclestone in 1991 and is still in place today making it one of the longest-running television deals in F1. This alone has generated $1.4 billion in revenue

Barcelona made a similar threat earlier this year, btw.

http://www.telegraph.co.uk/news/worldnews/europe/spain/11637077/Barcelona-mayor-in-waiting-threatens-Formula-1-funding.html

[helosailor]

If a race can not happen without government money then it doesn't need to be happening at all.

[Mach1]

Racing is dying. Kids just want to dick around on facebook, play xbox, and play with their ipads these days.

[Ruffdaddy]

Here are the values being thrown around for state of texas funding...im not sure how accurate they are but they seem close to everything else ive read.



Ecclestone has been under increasing pressure to drop race fees, but these rich oil states have no problem handing out the money and the number of races on the calendar just keeps climbing.

Part of me thinks epstein is grand standing (crying about only getting $19MM) to get the money from somewhere else. But with the COTA CEO getting the boot a few weeks ago, I really hope the direction they are taking is nascar/indy.

[mstng86]

I am just shocked The Seventh-Day Adventist Church General Conference Session received so much money.

[Baron Von Crowder]

I have pretty mixed feelings on this whole deal.

on one hand, the f1 race brings in a ton of people, and many of them are staying in hotels, eating at restaurants, taking cabs, etc. That helps the economy, but for the most part, it's limited to Austin/San Antonio area, with taxes paid to the state. The track itself hosts other events that brings in (to a lesser extent) money other weekends of the year. In the end, if the track were to just close up shop, that all goes away.

The flip side is, the state's fronting that tax income on a fixed level "betting on the come" so to speak. You cant run races like that in texas during 4 months out of the year due to summer heat, and 3 months in winter, so you end up with spring and fall that has an inherently higher probability of rain. While 100% of fans will want to go when it's 78 and sunny, a much lower percent will want to go stand in the rain. If they dont come to Austin, that tax money is much less, as is the economic gain for the business owners. I'm not a particularly big fan of the state handing millions over on that gamble, so that a private company can put it in their pocket.