New report reveals the state of F1 in the downturn
- Total revenues drop by $200m to $4.6m as team owner spending takes a sharp decline
- F1 Group grows race fees, broadcast revenues and series sponsorship
- Teams suffer in the economic decline as their sponsorship revenues fall by 8%
Formula One’s total revenues dropped by US$200m this year as the sport grappled with the economic downturn, but it still generated revenues of US$4.6bn, according to research contained in the new edition of Formula Money, the industry monitor for F1.
The new report breaks down the sources of revenue for the sport, including team sponsorship, race revenues, TV rights and car maker spending. Eight chapters cover sponsorship, trackside advertising, teams, drivers, races, media, GP2 and an overview of the sport, containing data such as a valuation of every current team sponsorship deal to the typical budget for a Grand Prix – invaluable data for executives preparing for the new season in 2010.
Now in its third year, Formula Money contains more than 200 tables which uncover every aspect of F1’s finances. With the sport facing the uncertainty of economic turmoil, this data has never been more important. This year’s edition has expanded from 156 to 180 pages to cover crucial data relating to the latest developments and to project how team budgets will be affected over the next few years as the sport introduces further cost reductions.
Formula Money has also responded to readers’ demands by providing even more detailed information on the finances of hosting a Grand Prix and estimates of the advertising equivalent value of the global broadcast exposure of F1’s team sponsors. This complements the data on print media coverage which was introduced in last year’s edition of the report.
The report calculates that the source of revenues which was worst hit this season was team owner spending, which dropped 30% from US$1.6bn to US$1.1bn year-on-year as Honda quit its US$350m annual investment in F1 and the remaining carmakers tightened their belts. Another blow for the teams came from a decline in sponsorship, with their combined sponsorship revenues dropping by 8% from US$836.9m to US$770.75m.
But it hasn’t been all bad news for the sport and some areas boomed despite the downturn. The sport’s commercial rights holder, the F1 Group, benefited from an 11% increase in race hosting fees, which rose from US$403.5m to US$448m despite the drop from 18 to 17 races. This was partly due to the inclusion of Abu Dhabi on the calendar for the first time and it wasn’t the only new agreement that the Group benefited from. Sponsorship of F1 itself grew by an impressive 79% to US$102m as LG and Universal Music came on board and TV rights revenues rose 18% to US$450m partly due to new deals in the UK and Spain.
Further details regarding these figures are revealed in the new edition of Formula Money. Its authors, Christian Sylt and Caroline Reid, are the world’s only newspaper journalists to regularly cover the business of F1. Their experience covering the sector stretches across all other types of media from magazines and books to radio and television.
Formula Money is an annual data report on the business of F1 containing 180 A4 pages with more than 200 tables. The report is published by Money Sport Media, which also publishes the Formula Money ROI Review, a PDF data release which is sent out after every Grand Prix and contains figures which show how the business of the F1 teams has been affected by each race.
The publishing partner of Formula Money is CNC, the communications consultancy which has worked with and represented several of motorsport’s biggest sponsors, seven car manufacturers and fourteen teams in Formula One. CNC’s global client list totals 500. For more information on CNC contact Xander Heijnen (+49 89 5994 58 127 email@example.com)
To buy Formula Money:
The new edition of Formula Money costs GBP175 and is available to purchase from www.formulamoney.com
*SPECIAL OFFER FOR BUYERS OF PREVIOUS EDITIONS OF FORMULA MONEY*
We have a special launch price of GBP150 for previous buyers of the Formula Money report. To claim this discount please contact firstname.lastname@example.org. Offer expires 15th January 2010.
For more information: Caroline Reid, +44 (0)7870 160 352, email@example.com