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Super Aguri: A sign of things to come // Financial struggles aren't limited to the back of the grid

Published by Dan Brunell

The usual process of including guest posts on a blog is for the owner to ask some of their favourite writers to come up with a piece or two to be featured. As you well know, Sidepodcast likes to do things a different way. The Facebook Group has plenty of fascinating discussions going on, and we want to bring those to the main site. The idea is for you guys to write your opinions and entries over on the group, and then we pick the best ones for feature over here on Sidepodcast. Sort of self-selecting guest bloggers, if you will. If you want to get your name in bright lights, just join the group and get writing. We read everything and everyone will be considered.

The first blog entry comes courtesy of Dan Brunell, our guest blogger guinea pig, and focuses on the plight of Super Aguri and what it means for the future of F1.

As Mr C and Christine have so eloquently pointed out, Super Aguri is in serious trouble. If they last the year it will be an achievement. If they get someone to buy them it would be a miracle. However, is their slow demise a sign of things to come in F1?

It’s an understatement to say that F1 is an expensive sport. Advertising arrangements with some teams are in the tens of millions of pounds. Manufacturers themselves pour in hundreds of millions of pounds. The strong economy of the last few years have allowed many auto manufacturers and companies to spend their efforts in F1. However, as the economy goes from bull to bear and wallets get tightened; their hefty spending on F1 might be one of the first things to go from the ledger sheet.

We have already seen Toyota, Honda, and Renault question their financial commitment to F1. Many grands prix are having a hard time finding proper sponsorship to pay the amounts demanded by Formula One Management. Plus, F1's own corporate hospitality and advertising business is $3 million in the red for last year. Add to this the uncertainty of F1 beyond Bernie and Max and this adds up to some troubling waters ahead. The last time the sport looked this uncertain financially, there was a massive turnover and upheaval in the sport due to the loss of cigarette advertising. The loss of several of the manufacturers and primary sponsors could have a similar, even more pronounced, effect.

In my view, there is a lot that F1 can continue to offer for advertisers and people involved. For Pete's sake, their estimate world audience for F1 is 6 billion people! However, unless F1 lowers its costs across the board and lower their expectations from advertisers and manufacturers, the long-term finances of Formula One looks very bleak. After all, for all the riches and egos in F1… these people still have to live on a budget and within their means. If Bernie and the F1 conglomerate which he leads continues to ask high prices of everyone involved in F1, the teams, races, and ultimately advertisers will go on to more effective advertising vehicles that are less costly. If F1 starts hemorrhaging advertisers, manufacturers, and sponsors, then the sport is in major trouble.


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