Grand Prix hosts reap the financial rewards
We generally read about governments groaning because of the cost of the fees to host Grands Prix and maintain the circuits. However, the latest data from Renault F1 title partner ING and F1 industry monitor Formula Money reveals that not only are the races covering the cost of investment, but they are making on average a 553 per cent return for governments.
The research covers all of the races in 2007 and reveals that four events – Brazil, Italy, the United States and most famously Britain – were the only ones not to receive any government funding. Including these races, the average economic impact was almost $108 million per Grand Prix, with Silverstone bringing $60m to the local economy. The government didn’t have to pay a penny for this return and will soon be waving it goodbye. The race and its benefits are expected to move north to Donington in 2010, so Silverstone’s local councils will be missing out on much more than the prestige of hosting a Grand Prix.
The best return was for the Japanese Grand Prix in Fuji, where the local Oyama Town only needs to contribute an estimated $4m towards the race since the deep pockets of the circuit’s owner Toyota provides the rest. Since the race drives $70m into the local area it gives a staggering 1750 per cent return for the government. This is only marginally ahead of second-placed Monaco, where the state gets 1714 per cent back from its $7m subsidy. At the bottom end of the scale is the European Grand Prix at the Nürburgring, though even there the local government saw a 167 per cent return on the money it put into the race.
But the Japanese and Monegasque governments were not the biggest spenders. This accolade goes to the Bahraini government which puts an estimated $45m into its race and also generates the biggest economic impact at $395m.
By Christian Sylt and Caroline Reid