Hosting fees may force British GP out of Silverstone

The owners of Silverstone circuit have questioned the long-term future of the British Formula One Grand Prix. Majority of the 11 Formula One teams are based in Britain.
The owners of Silverstone circuit have questioned the long-term future of the British Formula One Grand Prix. Majority of the 11 Formula One teams are based in Britain.PHOTO: AFP

LONDON • The owners of Silverstone circuit have questioned the long-term future of the British Formula One Grand Prix because of the "potentially ruinous risk" posed by hosting fees.

Local media reported on Thursday that the British Racing Drivers' Club (BRDC) had informed all its members in a letter last month that it was giving serious thought to exercising a break clause.

"The board is considering whether we should give notice before the 2017 British GP of our intention to exercise the break clause in the contract at the end of 2019," wrote BRDC chairman John Grant.

"This is not a simple decision and we shall consider all the implications before coming to a conclusion by mid-year."

Silverstone, which hosted the first Formula One championship race in 1950, has a contract to 2026 with a break clause on both sides.

Grant said the board hoped to preserve the race at the circuit for years to come, providing it made commercial sense.

"We have to protect our club against the potentially ruinous risk of a couple of bad years," it added.

"Without some change in the economic equation, the risk and return are out of kilter."

Last year's race drew some 139,000 fans, boosted by homegrown past champions Lewis Hamilton and Jenson Button.

Majority of the 11 Formula One teams are based in Britain, including Hamilton's Mercedes GP.

Formula One's chief executive Bernie Ecclestone told ITV that Silverstone were free to activate the break clause.

"Two other tracks have contacted us and we are keen to keep a British Grand Prix, there is no doubt about it, we want to have one," he said.

"As far as Silverstone is concerned, it's not in our hands."

Silverstone's future has been a perennial theme in Formula One, with Ecclestone comparing it unfavourably to newer, exotic venues that pay heftier hosting fees.

The BBC said Silverstone would have to pay nearly £17 million (S$30 million) this year, rising to £26 million by the end of the contract.

New owner Liberty Media is set to take full control of the sport this year. Liberty has said that it wants to safeguard traditional venues and put more emphasis on marketing Formula One to new audiences, reducing costs and putting on a better show for racing fans.

Circuits such as Silverstone can be expected to seek more advantageous contracts in the future.

REUTERS

A version of this article appeared in the print edition of The Straits Times on January 07, 2017, with the headline 'Hosting fees may force British GP out of Silverstone'. Print Edition | Subscribe