19/07/2009
NEWS STORY
Bernie Ecclestone's relationship with Silverstone looks like a teenage love affair what with its on/off twists and turns, and right now the circuit is flavour of the month.
In a u-turn from previous comments Ecclestone has said that if Donington, which is due to host the British GP from next year, cannot get its funding in place then the race can stay at Silverstone. Today Pitpass' business editor Chris Sylt reports in the Independent that Ecclestone is even open to Donington and Silverstone rotating the hosting of the race.
You would have thought that Damon Hill, president of the British Racing Drivers' Club, which owns Silverstone, might be lapping up what seems to be a 'whole lotta love' coming the circuit's way. Not so. Hill is fed up with the ups and downs and is finally looking for stability in Silverstone's relationship with F1.
"I am not in favour of rotating it. I think it's an insult. It's another absurd step to try and squeeze as much profit and as much benefit for the commercial rightsholder. Again, it's not a long term strategy," says Hill adding "I'm in favour of the contract for the British Grand Prix being negotiated with Silverstone because I don't believe that the Donington project is viable."
There is good reason for his annoyance. Silverstone would normally be putting plans in place now for hosting the British GP next year. It would consider how many contractors to hire and would soon start printing tickets. But not this year because, although Ecclestone says it may host the race, it has no contract to do so. However, Hill doesn't just blame Bernie for this situation.
"How can the FIA be regarded as a responsible guardian of the sport?" Hill blasts, explaining, "we've got a situation where the French Grand Prix has fallen through, the German Grand Prix is making noises, there is a blank in the calendar for 2010 and the British Grand Prix, we've lost both North American races. Who is really looking after the sport?"
The FIA does have some power when it comes to the location of events since the British Grand Prix is on a list of so-called 'traditional' races which the governing body can insist remain on the calendar. However, the catch is that they must pay the going rate and the biggest paying races are footing fees which are double the £10.5m ($17.3m) paid by Silverstone, so its place on the calendar isn't as secure as it may seem. Hill thinks the FIA should do more.
"The purpose of having a governing body is that they take a broad view of what is in the best interests of the sport as a whole. Not just Formula One but motorsport. And a very important part of motorsport is the right venues. And also ensuring that events are not lost to places where there has been no support for the sport." That will be Turkey and Bahrain then given the crowd (if you can call it that) numbers there in recent years.
Ironically, giving Donington the contract for the British GP should have stopped uncertainty over the future of the race, however, it was not to be. Despite allegedly having a 17-year contract to host the race, Donington needs to find £80m ($130m) to make the relevant modifications so that Grands Prix can take place on the 86 year-old circuit.
"If they don't do it Donington will get together with Silverstone," says Ecclestone adding that Silverstone itself also needs to make improvements in order to host F1 next year. "If Silverstone do all the things they promised me they are going to do we are going to be at Silverstone," he says. Hill is none too pleased with this attitude.
"You can't continually berate a venue for not having generated the facility if you are constantly playing games with it," says Hill, adding that "we're not given a margin which is sufficiently strong to guarantee borrowing money to reinvest." Unlike most events, F1 race promoters don't get a share of TV or advertising revenues - their sole source of income is from ticket sales.
Hill adds that rotating the race is "making a pig's ear out of something that could be a silk purse" but it could be the only way that Donington gets its chance to host F1. Resources are running short with Donington's latest accounts showing that it had just £28 in the bank at the end of 2007.
Most Grands Prix break-even and if they make a loss it is covered by the government. However Britain's is the only race which has no state support and consequently, if Donington starts its F1 contract with an £80m loss, it could struggle to cover it. If it has a one-year breather between races it can host events which are more profitable than F1 in order to build up a reserve.
However, even if Hill agrees to the race rotating with Donington, it might still not secure the future of the British Grand Prix.
The German Grand Prix has been alternating between Hockenheim and the Nürburgring since 2007 but the race is now in jeopardy. This is because it is not breaking-even but instead it is making losses which are tough to cover even with a one-year breather.
Ticket sales for the race at Hockenheim have slumped 37% since 2002 and last year it made a €5.3m loss. Hockenheim officials are struggling to find the resources needed to hold the 2010 race, with the circuit's local city and state officials refusing to bankroll it. "Without grants from the state there will be no more Formula One in Hockenheim," said the circuit's boss Karl-Josef Schmidt in December last year.
Ecclestone and German minister Gunther Oettinger were scheduled to meet last weekend to try and renegotiate the race fee for Hockenheim which currently stands at $21.5m. However, these talks were cancelled after Ecclestone's infamous comments about dictators.
With doubts about the future of the race in Hockenheim, there were hopes that Nürburgring could replace it but even these have hit the wall. "Definitely we are not available for next year, we are planning only for 2011," says the Nürburgring's managing director Walter Kafitz adding that only a reduction in the race fee would change his stance. "Bernie could manage it (by reducing the fee), but I cannot imagine that he is willing to accept my wish."
Schmidt ominously adds that only countries in the Middle East will be able to afford F1 in future unless the race fees decrease: "Formula One will disappear not just from Hockenheim but from Germany as a whole. Then it will only be run in Arab countries."