By Alan Baldwin
LONDON (Reuters) – 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 the British Racing Drivers’ Club (BRDC) had informed all members in a letter last month it was giving serious thought to exercising a break clause.
“The board is considering whether we should give notice before the 2017 British GP (as required) 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’s letter, which was shown on the website of television broadcaster ITV, 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 triple world champion Lewis Hamilton and McLaren’s now-departed Jenson Button.
A majority of the 11 teams are based in Britain, including Hamilton’s Mercedes.
Formula One’s 86-year-old commercial supremo 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.” The future of the race has been a perennial theme in Formula One, with Ecclestone comparing it unfavorably in the past to newer and more exotic venues that pay heftier hosting fees.
The BBC said Silverstone would have to pay nearly 17 million pounds ($21.08 million) this year, rising to 26 million by the end of the contract.
The BRDC letter was seen by some as posturing, however, with new owners Liberty Media set to take full control of the sport this year.
Liberty have said they wanted to safeguard the traditional venues and put more emphasis on marketing the sport to new audiences, reducing costs and putting on a better show for fans.
Circuits such as Silverstone can be expected to seek more advantageous contracts to turn losses into profits in future.
(Reporting by Alan Baldwin, editing by Peter Rutherford)
By Alan Baldwin
