F1 Business Diary 2014: the Brazilian Grand Prix

The Brazilian Grand Prix was won by Nico Rosberg, setting up what is certain to be a dramatic showdown for the world championship in Abu Dhabi. Wider questions about Formula One’s finances and commercial structure will, however, continue long after the last laps have been raced in 2014.

Even as the Brazilian Grand Prix began on Sunday, the world of Formula One appeared a confused place.

With two teams absent – one wound-up, the other attempting to raise the money to race in Abu Dhabi via the rather desperate method of crowd-funding – and the continuing possibility of some teams being required, as per their contracts, to run third cars next year should any more teams go to the wall has cast a shadow over the end of the season.

Essentially, the smaller teams are struggling, unable to comprehend how the sport’s revenue distribution can be skewed so heavily in favour of the larger teams, especially at a time when engine costs are at an all-time high. The larger teams appear unmoved, engaged in their own squabbles about the possibility of relaxing engine rules for next year, which would in theory allow Renault and Ferrari to try and claw back some of Mercedes’ advantage. Mercedes, predictably, is not to keen on that.

Although the bulk of the teams’ revenues come from Formula One itself, their financial positions are not helped by the difficulty in finding commercial partners. Sponsorship, it is often said by Formula One marketers, is thin on the ground, but how true is that? Below, we take a look at the deals each team has renewed and the sponsors they have acquired since the lights went out for the first race of the year in Australia last March.

Mercedes, as world champions and the year’s dominant team, have unsurprisingly seen an upturn in external commercial interest.  A major multi-year renewal with title sponsor Petronas was confirmed at Monaco in May, followed by a new agreement with Hugo Boss which will kick-in next year and see the brand switch from McLaren. Watchmaker IWC Schaffhausen and hotel chain Starwood both renewed, while technical and supply deals were agreed with EBM Papst and Assos respectively.

Sahara Force India has been just as active in the sponsorship market, securing a series of deals with Mexican companies, including Consorcio Aristos and Ficrea, as the season began in Melbourne. Those agreements were linked to the signing of Mexican driver Sergio Perez. In addition, 2014 has seen new partnerships struck with GatoradeAuden McKenzieUniva and most recently digital media firm Accelerate. The most visible new deal, however, was May’s partnership with Smirnoff, which was bound up in Smirnoff’s parent company Diageo’s acquisition of United Spirits, team owner Vijay Mallya’s drinks company.

Aside from a potentially game-changing power unit supply agreement with Mercedes, which will begin in 2015, Lotus has sealed three new commercial partners this year, all on a short-term basis, as the team looked to fill space on its car. Interwetten and Hisense were onboard for two and three events respectively mid-season, followed by a similar deal with Endless Jewelry later in the year. The bulk of the team’s external funding, however, comes from Venezuelan oil giant PDVSA, a deal linked to Pastor Maldonado’s seat in one of the Lotus cars.

A quiet year commercially for deposed world champions Red Bull Racing has involved only a small supply deal with Scott Sports and a new-for-2015 sponsorship agreement with Russian forex broker Exness. Sister team Toro Rosso is one of only three teams – the others are the stricken Marussia and Ferrari – not to have signed a single new commercial partner since the season began.

McLaren have filled the space usually allotted to a title partner by giving extra branding space to its existing line-up of partners, including Mobil 1 and SAP, but it has not yet secured a company to replace Vodafone, which exited at the end of last year. It extended and expanded with Gillette in April and snared a new partner in coffee brand Segafredo Zanetti, a deal unveiled at September’s Italian Grand Prix. In July Kitbag signed a deal to run the team’s global retail operations. The team has Honda on the way for 2015, however, as both a technical and commercial partner.

As for the rest, it has been thin pickings on the sponsorship front. Williams, which secured a much-needed title sponsorship deal with Bacardi-owned Martini on the eve of the season, added Italian fashion brand Cavallino in May. Caterham, which unveiled its crowd-funding plan to raise UK£1.5 million by this Friday to try and get to Abu Dhabi, agreed a new partnership with semiconductor manufacturer Silanna early in the year. Meanwhile, Sauber’s deal last week with Banco do Brasil, backer of new driver Felipe Nasr, was its first commercial partnership announcement of the season. Ferrari has a stellar existing collection of commercial partners, but has not renewed or signed any new agreements so far this year.

The final banquet

Will Lewis Hamilton become only the fourth man from Great Britain to win multiple Formula One world championships? Or will Nico Rosberg end up as only the second son of a world champion to go on to win the title himself? The Abu Dhabi Grand Prix on 23rd November will reveal all but the Business Diary’s resident chef George Dudley has already nailed his colours to the mast:

The season’s last race in Abu Dhabi will be a time to celebrate; and what better way to celebrate a British world champion and the marvellous career of Jenson Button.

Hopefully I am not tempting fate by crowning the great Briton, otherwise the recipe will be altered to plain old 'egg on one's face'.

However the risk is worth taking as there is no grander meal than the one named after one of Britain’s greatest leaders, eaten at 1pm as the race starts.

Beef Wellington with red wine jus.

Prepare the jus and beef on the Saturday.

2 diced shallots
1/2 bulb of garlic, squashed with the back of a knife Thyme
1/2 bottle of red wine
400ml good beef stock

Heat a saucepan and glug in some olive oil. Pop in the diced shallots, garlic, and thyme and cook until they caramelise and darken considerably.
Pour in the vin and reduce, on a high heat, until it becomes an unctuous syrup. Add the beef stock and reduce it by two thirds.
Pass through a sieve and reserve 'till the race.

1 sheet of puff pastry
1kf fillet of beef
400g of (Jenson) button mushrooms, diced
1/2 packet of pate
4 eggs

Saute the mushrooms in olive oil until browned and the residual water has cooked off – then fling it into a magimix and blend until smooth.
Heat a frying pan, add some oil and seal the fillet and then leave to cool for 25 minutes.
Whisk the eggs.
Smear the cold fillet in the pate, then the mushroom pure and lay it in the puff pastry. Paint a boarder on the pastry – carefully fold into a parcel. Flip the Wellington; the folded side acting as the bottom. Cling film and cover until Sunday.
30 minutes before the race starts, egg wash the pastry completely and cook in the oven for 20 minutes at 200 c to serve rare. Reheat the jus. Serve with green beans and watch Mr. Hamilton drive imperiously.
Enjoy with a robust Claret – with it being double points, perhaps treat yourself to two bots!

George Dudley is the head chef of London's Fox & Anchor. His blog, Splendid Red Trousers, can be found here.


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