Grand Prix Business Diary: Canada

The Canadian Grand Prix is one of two North American stops on the 2012 Formula One calendar. Austin was on the agenda even in Montreal, along with driver salaries and continuing speculation over Formula One's IPO.

The presence of 1978 Formula One world champion Mario Andretti, the last man from the USA to win the title, in the Montreal paddock as a guest of Bernie Ecclestone was a reminder that there is but months to go until the return of the United States Grand Prix.

Since 2007 Canada has been Formula One’s only North American stop but there are high hopes for Austin’s purpose-built Circuit of the Americas, assuming it can be completed in time and what seems a rather ambitious business plan for its year-round use can be fulfilled. What never ceases to amaze, however, is Formula One’s haphazard approach to promoting itself in America despite Sebastian Vettel’s Monday night appearance as a guest on The Late Show with David Letterman.

This time it was a piece of scheduling that was misguided at best and plain stupid at worst. Yes, while Lewis Hamilton was winning in Montreal – a rare Grand Prix run at a sensible time for US viewers – Joey Logano was winning the Nascar Sprint Cup race in Pocono. Guess which race most American viewers were watching?

To boldly IPO…

Plans for an Initial Public Offering (IPO) on a Singapore stock exchange may have been shelved for now but they remain on course, especially following the US$1.6 billion sale of 21 per cent of CVC Capital Partners’ majority stake in the sport to three new investors, BlackRock, Waddell & Reed and Norges Bank Investment Management. Zak Brown, the founder of JMI one of the sport’s leading agency, believes the offering will strengthen Formula One, as he outlines here:

Montreal’s balancing act

Montreal is often cited by Formula One folk as one of the most enjoyable race weekends of the year but for local organisers the Canadian Grand Prix, the country’s largest tourism event, remains something of a financial balancing act.

The Canadian and Quebec governments, plus the city of Montreal and its tourism offshoot, provide an annual investment of some CAN$15 million over the five-year contract duration. The Canadian government and Tourisme Montreal pay CAN$5 million, with the government of Quebec paying CAN$4 million and Montreal CAN$1 million. In return, they receive a 30 per cent share of ticket sales revenue. The race itself is run by Canadian motorsport event promoter Octane Racing Group which in November 2009 secured a five-year contract covering 2010 to 2014.

The Ron-tract

Ron Dennis, bedecked in McLaren’s celebratory ‘rocket red’ was understandably delighted after Lewis Hamilton’s first win of the year, but speculation continues over Hamilton’s future at the McLaren team he has been with since he was a child.

Speaking to Sky Dennis let it be known, perhaps deliberately, perhaps not, that Hamilton’s last contract with the team was signed when the “economy was slightly different” and there would have to be a “balance” struck in the negotiations to come.

The implication is Hamilton may have to take a pay cut, especially as few realistically believe he will leave the team with which he has spent his entire career. Food for thought for Simon Fuller, head of the XIX agency that manages Hamilton.

Fuller was in Montreal and has a busy few months ahead managing not only his Formula One star, plus an Olympic-bound David Beckham and tennis star Andy Murray.

A spot of horse whispering

Fernando Alonso may be regarded in some quarters as the best pound-for-pound driver in the world but how many pounds exactly does he earn?

The Horse Whisperer, the Ferrari communications department’s anonymous online mouthpiece, returned in the days leading up to the Canadian Grand Prix to refute suggestions that the Spaniard earns €30 million annually.

And when the Horse Whisperer refutes something it usually does it in style. ‘A shame then that it’s another case of utter balderdash’ it said of a French publication’s estimate, adding: ‘Things ain’t what they used to be we are told, but, when it comes to money, the song remains the same: Ferrari spends more than anyone.

'A shame then that the reality is very different, as those who work in the business know only too well.’ 

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