McLaren Team Principal-in-waiting Martin Whitmarsh has backed FOTA’s demands for a greater share of Formula One’s revenue but concedes that any kind of re-distribution is unlikely to happen in the short-term.
The teams currently earn around 50 per cent of Formula One’s profits in the form of FIA prize money with the remaining half going to commercial rights holders CVC Capital Partners.
President of the Formula One Teams Association (FOTA) Luca di Montezemolo, backed up by the teams, put pressure on Bernie Ecclestone to review the current financial arrangements in December last year after a raft of cost-cutting proposals had been rubber stamped by the FIA [see separate story HERE].
But Ecclestone, who acts as Chief Executive of the Formula One Group on behalf of CVC and faces increasing pressure to offset the debts that the private equity firm have accrued in buying the sport reacted angrily to the demands and launched a scathing attack on Di Montezemolo citing the special financial benefits that Ferrari enjoy as a result of their historical status [see separate story HERE].
Di Montezemolo has now launched a fresh appeal for a more equitable financial deal after appearing to settle his differences with Ecclestone at Ferrari’s annual ‘Wrooom’ festival at the Madonna di Campiglio ski resort in Italy [see separate story HERE]
Prioritising the need for a fairer deal for the teams he said: “We now need to face the issue of revenues. We have a Concorde Agreement with FOM until 2012. There will be time between now and 2012 to improve the commercial aspects and especially the show, and then to evaluate what to do after that, with seriousness, stability, success and sustainability.”
However, Whitmarsh believes that any negotiations to begin this process are unlikely to happen until after 2012 given that the teams are already locked into the Concorde Agreement.
“It s not a discussion that we have to have urgently because in truth most of the teams are fully contracted until 2012,” he told journalists at the launch of McLaren’s new car this week. “But I think it s a discussion that needs to happen in the future in terms of what is a fair and equitable apportionment of the funds that flow into this sport.â€
Whitmarsh believes that the teams must focus first on ensuring that their own operations are financially viable in the current economic climate.
“I think the reality is that the teams have had to do quite a bit of work to sort out their own houses,” he said. “FOTA so far has been very successful in that regard, but it s early days and we could still fail but I think we re doing a good job there.
“I think it s now reasonable to look at the income. You ve got to look at, one, how much does it cost to go motor racing and how do we make sure that the requisite number of teams can afford to compete.”
“At the moment there are a range of different agreements in Formula 1 they need to be harmonised to a degree, and we ve got to look to the future.
“The teams invest a huge amount in providing the spectacle that is Formula 1, and not unreasonably are going to have discussions with the commercial rights holders to make sure that in the future there s an equitable arrangement.â€
The McLaren chief acknowledged that ultimately the teams will be looking to secure a great slice of Formula One’s revenue, which he hopes will grow.
“We will honour all the arrangements that are in place at the moment, but looking to the future, working with FOM and the FIA, we ve got to grow this sport and grow the revenue. I think making the cake bigger so that we re all happy is a good thing.
“And inevitably I would want more of the cake than Bernie would be happy to give us, and that would be the same for every stakeholder in this sport.â€