UPDATE: Silverstone circuit organisers have lost the battle to retain the British Grand Prix which will be hosted at Donnington Park from 2010, the FIA announced on Friday (See separate story HERE ).
All eyes will be on Lewis Hamilton at this weekend’s sell-out British Grand Prix, but behind the scenes Silverstone organisers are locked in a fierce battle to secure the future of the venue as the home of British motorsport.
Forumula1.com‘s Chris Hayes assesses the current climate surrounding the Northamptonshire track as the former airfield gears up for its Diamond Anniversary after 60 years in business.
‘Home of British Motor Racing’ is the message that towers over you as you drive through the main gates of Silverstone. The historical significance of this classic sporting arena instantly hits home as you search for the signs not to an arbitrary numeric corner reference but legendary names such as Copse, Beckets or Stowe, each with over fifty years of action and narrative behind them.
Watching the stars of today hustle their machines through corners which have been graced by the likes of Fangio, Moss, Hill, Clark and Stewart in years gone by is an all too unique experience as emerging global venues open their gates to the Formula One show.
This privilege at Silverstone – to be enjoyed by a record capacity crowd of 240,000 this weekend – has come under increasing threat however as the on-going saga over the future of the British Grand Prix rumbles on…
Silverstone’s contract to host the British Grand Prix expires at the end of 2009 and commercial rights holder Bernie Ecclestone has said that he does not believe the Silverstone-owning British Racing Drivers’ Club (BRDC) can afford his fee to renew the contract. He has also made it clear that he would have no problem in dropping the race from the calendar in 2010.
The new five year contract, which was sent to the BRDC earlier in the year, was believed to be $22 million per year, with a five percent per annum escalator to compensate for the weakening of the dollar (less it has to be said than most multipliers in F1 deals at the moment, which are closer to the region of 10% per annum). This is a significant increase over the 2004-09 deal – thought to be around $13 million plus the escalator – and will mean the BRDC will end up paying around $120m over the five-year term.
Attached to the new contract is a demand for the Northamptonshire track to make crucial improvements to its facilities, a requirement that the BRDC have been working hard to meet. Planning permission for a new ÂÂ£30 million pit-lane and paddock complex was approved in February – an achievement in itself given the intricacies of the English planning system and the fact that Silverstone borders three different counties.
However, discussions hit a set-back in May when the BRDC returned the new contract to Ecclestone with queries about the deal, many members having been opposed to the cost of the fees. Part of the reason behind the stalemate is that redevelopment is unlikely to begin until the commercial deal with Ecclestone is tied down, due in part to the financial risk involved of selling off land and assets to generate the revenue required. Ecclestone meanwhile has said he wants to see the redevelopment begin before a new contract can be agreed.
“I liken it to the Aladdin’s cave,” says BRDC president Damon Hill. “The genie says give me the lamp and Aladdin says get me out of the cave and I’ll give you the lamp. You’re in this constant cycle whereby in order to get our plans implemented we need to have a Grand Prix contract, and in order to get the Grand Prix contract we have to have our planning.”
But the former world champion believes headway has been made in the negotiations: “It’s going round in circles, but the circles are getting smaller and we’re getting closer to the final stage I think. We’re definitely making progress. We’ve got the planning consent for our pit and paddock complex. It’s one step at a time; the negotiations typically will be ongoing and I expect won’t come to a conclusion until the final hour, whenever that is. If we’re going to fulfil the building requirements then ideally we have to get going on with it before the end of this year. So it’s situation normal.”
Silverstone’s silver bullet
There is no doubting that Silverstone’s chief selling point is its ‘home of motorsport’ tag and its status as a true classic on the F1 calendar. Government-backed venues such as Abu Dhabi and Qatar may be willing to fork out $50 million a pop for a Grand Prix but a rich racing heritage is something that all but escapes them – though that is not to deny them of the many other benefits that they offer. There is also a question mark over how sustainable the pull of the F1 circus is in some of these emerging markets; in Malaysia earlier this year there were grumblings about the number of empty grand-stands on race day which led to rumours that Sepang’s contract might not be renewed. This is unlikely to ever be a problem in Britain if the 240,000-strong capacity crowd expected for this weekend is anything to go by. “Silverstone is a classic date on the racing calendar, and it attracts a special calibre of fan,” said BMW boss Mario Theissen earlier this week. “A lot of the racing enthusiasts who come here are less concerned with the personalities and the show side of things and more interested in the sport itself.”
Hill is under no allusions of the extra market value that Silverstone brings to the table: “Bernie drives the marketing of Formula One and he knows he’s got a product which has a market value in the world,” explains Hill. “He doesn’t see any reason why that can’t be matched wherever you go – especially when it comes to a country which is one of the World’s leading economies.”
“But equally you can say, hang on a minute, this is one of the best places that Formula One can come to, so it has a value in that regard. We will be sold out all five days and that will be great for Formula One. The reason is that the UK has such a history – we’re celebrating 60 years of Silverstone – success in motorsport in drivers, teams and technology; and a knowledgeable fan base who are prepared to come to Silverstone and support the event. So, how valuable is that? That’s also an argument.”
The politics of protected races
Unfortunately, in the current political environment with the FIA at loggerheads with the commercial rights holders CVC and Bernie Ecclestone’s Formula One Group, it is questionable just how much weight this ‘added value’ argument carries.
CVC Capital Partners – who now own around 70% of the Formula One Group after Ecclestone sold off the bulk of his shares in 2004 – are arguably less concerned with securing the future of classic tracks such as Silverstone as they are with maximising revenue.
That is the view of beleaguered FIA president Max Mosley at least. Admidst the wrangling over a new Concorde Agreement – the highly secretive contract that binds the FIA, the Formula One teams and commercial rights holders over the sport’s terms of competition and revenue-sharing – Mosley has accused the commercial rights holders of trying to seize control of Formula One and rob the FIA of it’s core regulatory functions, including it’s right to protect the traditional races on the calendar.
The previous Concorde Agreement protected the four so-called ‘classic races': the Monaco, French, British and Italian grand prix. But Formula One is not currently operating under this agreement which leaves a question mark over the issue of protected races. Damon Hill admits that Silverstone would be interested in such a status, but he acknowledges that in the current political environment it is not something that the circuit can rely on.
“The FIA is respected as the governing body of F1 and World motorsport and we are very interested in the concept of events being protected events. We certainly regard the British Grand Prix as an event that has been linked with Formula One since its inception and is historically devoted to motor sport and has a very strong relationship with F1 and the FIA.”
“So we would regard ourselves as stakeholders in that sport. The politics are quite interesting at the moment, so that means that we have to avoid becoming embroiled in that, and tread carefully in getting engaged in a bit of a dispute at the moment about the ownership and running of F1. We would like to avoid the taking of sides in that one.”
“The British GP is an important event globally. It is conceived as being an intrinsic part of F1, but things can change and I can see that too. But, if there was a way of it becoming a protected event that would be of interest – but we are certainly not relying on it.”
Bernie Ecclestone is a shrewd businessman and as a product of Britain’s racing legacy himself, having started out as a team owner, it would be foolish to think that he is unaware of the value that traditional tracks like Silverstone bring to the table – Concorde Agreement or not. The uproar from the teams, drivers, and fans that would follow should the classics be ripped from the calendar would be tremendous, and the damage to the business monumental. While it is true that Ecclestone has relinquished much of his ownership of Formula One, his influence on the sport, through the board of executives he now answers to, remains as potent as ever.
However it would be wrong to think that Silverstone can fall back on its history alone to secure the future of the British Grand Prix. Alternative venues such as Donington Park and Brands Hatch are also well placed to stake their claim as custodians of Briton’s motor racing inheritance. The former – which played host to Ayrton Senna’s memorable victory in 1993 – has already caught the eye of Bernie Ecclestone and renowned circuit designer Hermann Tilke is believed to have visited the circuit to scope the possibility of holding a grand prix there.
The BRDC are under no doubt that they are competing as well as fighting to hold on to the British Grand Prix, and Damon Hill is resolute in his determination to transform Silverstone into the UK’s premier motorsport venue. The fact that the 10-year development programme for the venue includes plans to build a new university campus, business park and housing infrastructure, illustrates a clear commitment to making Silverstone a more sustainable venue and in turn attract the government backing that has so far eluded the BRDC.
“I would never discount any other option. It’s the nature of this free market that there’s always another option to go to and we have to compete,” says Hill. “A tremendous amount of work has gone in to placing Silverstone, and getting it to the position where it’s teed up to become a leading centre for World motorsport. I think it’s ideally placed for Formula One and for all motorsport, and we also have ambitions to fulfil the objectives of the government, which are to provide education, vocational training and also promote the UK.”
“We’re now making good progress to create foundations for a fantastic realignment of the assets of Silverstone, so that they are reinvested in Silverstone to provide the best facility, the best track and also educational facilities which may appeal to the national government, if they feel inclined to support us in what we’re doing. We’re certainly not making any demands, but I think Silverstone is the UK’s premier venue and I think it is right that we don’t lose it and that it represents the best of what the UK can offer.”
With its racing legacy propping Silverstone up and a strong recognition that the grand prix has a role to play in meeting objectives outside of Formula One, the BRDC are well placed to fight for the rights for the British Grand Prix beyond 2010.
However, Hill, who has had to cope with his fair share of uncertainty over the course of his time in Formula One, is not taking anything for granted in the negotiations: “I would say 50/50 was probably about right,” he said of the BRDC’s hopes of renewing its Grand Prix contract. “I am not going to assume anything when it comes to F1. My experience is you should never make some presumptions, so it would be prudent to consider it in a 50/50 figure. But, I am 100 per cent confident that we have got what it will take and we can deliver what F1 will be proud of and the UK will be proud of.”
What would it mean to keep the British Grand Prix? The answer is a similar response to the questions surrounding Lewis Hamilton’s hopes of victory this week. The ramifications of him losing are far greater than the moral-boost that would come with wining. Hill hit the nail on the head when he described the feeling for a British driver to win his home grand prix: “The alternative is an unthinkable one: you don’t win,” he joked. “That’s the thing you don’t want to contemplate.”
The same could be said of Silverstone’s future.
By Christopher Hayes