14/11/2012
NEWS STORY
With the first Grand Prix in Texas taking place in just a few days the eyes of the United States are on Formula One. There are no American drivers in F1 but that could change if the green light is given to plans under consideration by the F1 Group.
Earlier this year the sport planned a £6.3bn flotation on the Singapore stock exchange but the volatile economic climate ultimately put the brakes on this. As recently revealed the float is now not due to take place until 2014 despite everything being ready for it to go ahead in June this year. A flotation prospectus was issued in May and it showed both the current financial strength of F1 and its future potential. One of these routes for growth is an American version of F1's junior series GP2 or GP3.
The prospectus states that this expansion has the working title of the 'Americas Series' and, if given the green light, it will feature races in the United States, Canada and Brazil. The aim is to stimulate the development of grass roots motorsports in these countries and generate publicity for F1 so that it eventually attracts more local drivers.
In 2007 Sylt revealed that the F1 Group had bought GP2 and the following year he revealed that the GP3 series was being planned. Sylt says that the difference with the GP2/GP3 'Americas Series' news is that the prospectus makes it clear that this is only a development which the F1 Group may consider. It would be misguided for anyone to treat it as being set in stone.
According to the documents, the F1 Group believes that it will eventually be able to develop its business in North and South America to a level comparable with that in its traditional European base. It is a bold aim given that only three of the 20 F1 races are in the Americas this year with Canada and Brazil accompanying Texas.
This isn't the first time a regional variant of GP2 has been proposed. Indeed, the GP2 Asia winter series was launched in 2008 but its last season was in 2011 when it only held four races with two of them taking place at Imola in Italy. Although teams were encouraged to run local drivers, many still chose Europeans or South Americans instead.
Neither GP2 nor its own feeder series GP3 come anywhere near to F1's earning potential yet. They generated £28.2m in revenues last year which represents around 2.9% of the F1 Group's total revenue. However, a regional series could still bring big benefits.
It isn't only the F1 Group which would benefit from an expansion of GP2 or GP3. As the sport's profile grows in the US it is likely to increase interest in sponsorship from American companies. If this flows to the teams they would benefit but they would not receive any additional revenue directly from the series itself as turnover from GP2 and GP3 is excluded from the F1 prize money fund. In itself this makes the series a very good growth opportunity for the F1 Group. One wonders how long the teams will allow it to remain an untapped source of revenue for them.