October 5, 2023

Why are the top Formula 1 leaders thinking about a bigger future?

Why are the top Formula 1 leaders thinking about a bigger future?

(Motorsport-Total.com) – Owned Liberty Media Formula 1 for five years. At the F1 Business Forum, organized by the Financial Times and Motorsport Network, in Monaco, we met Liberty CEO Greg Maffei and F1 CEO-Stefano Domenicali talking about key milestones and their future plans for Formula 1 for the latest #ThinkingForward.

Stefano Domenicali (left) and Greg Maffei (centre) see Formula 1 in good shape


Greg Maffey: “According to all indications, Formula 1 has never been healthier than it is today. The interest from the fans is amazing. We have a lot of competition on the track and the teams helped us. When we entered, Manor, Team XI, it was only for pounds sold in receivership. And I don’t think it’s You can buy a team for less than $500 million today, maybe even $700 million.”

“You can try. But it’s going to be tough. It’s an amazing value proposition. That’s partly because of the actions that have been taken to create more competition on the track, which also boosts the health of these teams. You have to have a ‘healthy ecosystem of teams’ to make it work.” And I think all of these things are happening and you’re also seeing increased fan interest. We’ve never seen events of this scale on TV or in person. Things are going well. “

Business events in Monaco

The future of sport was the topic of the Business F1 Forum in Monaco Zoom

A question: “Stefano, the most important milestone in team promotion was setting the cost cap, which many believed would never be achieved in Formula 1.”
Stefano Domenicali: “Sure. I think the vision that Greg, along with Chase (Carrie), to whom we have a big shout out, was the need to create a disconnection from what has happened so far. And the interruption means that we are changing the way this sports business is run. professionally.”

“The vision was to make Formula 1 business sustainable from a financial point of view. We can talk about the revenue which could be higher, but the cost is something you always have. The only way to ensure that the profit margin increases is to control the spending.”

“So this was a very big milestone that completely changed the vision of the sport and gave credibility to the system. Sustainable work means teams can invest and grow. All the elements are now secure and financially strong.”

“We can think of a bigger future. Thinking of a bigger future means that we have to respect the past of Formula 1, but entering new markets that allow us to grow – not just financially, but in terms of this awareness and passion for the sport we are talking about a sport that has to have an element Passionate; we want to bring the main attention to the track.”

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“So it is about the great races and the riders, who are gems to us, have the opportunity to compete against each other and make them visible through social media. It is important to work with the new generation to communicate. We need to create different narratives for different types of fans.”

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A question: “I don’t think there has been such an influx of new sponsorship money into the sport since tobacco advertising was banned in the mid-2000s. Every Formula One team you’re talking to now has to cancel their sponsorship.”
no: “I think it is, because there is limited space on the car to add more logos. There is a lot of interest from people who really understand the technology.”

“There has been a massive surge of interest from the tech communities in Silicon Valley – look at how many cars now have a tech sponsor, if not multiple. It opened up a new audience, but then there are more occasional fans out there who might appreciate the stories of the drivers and the characters “.

Also, our fans are getting younger. According to one of them Poll (the 2021 Motorsport Networks Global Fan Survey), we lowered the average lifespan by four years. So a whole range of consumer products and from other brands showing interest have been taken advantage of. So we’re really fortunate to be attracting all kinds of nurturing interest.”

Business events in Monaco

The F1 Business Forum is organized by the Financial Times and Motorsport Network Zoom

Domenicali: “Just think about the issue of cryptocurrencies. We have ten different brands of cryptocurrency. And I can tell you that the software business works well. It is very healthy. This means that for the first time, there is no need to take out loans, as they are used to make sure that the difference remains So it’s very powerful, and that’s a great reward for investing it in us.”

“This is also why we believe that the team community should be respected. Today there is no problem with having more teams because there is a list; some are louder than others but there are a lot of people and investors who would love to be in Formula 1. But we have to protect them. This is another sign. On having a very healthy system.”

A question: “Now with ten teams, do you have the right number of teams?”
Domenicali: “I think so. Anyone who wants to participate should really matter.”

no: “If we’re talking about younger audiences, thanks to Netflix a lot of people have come in. But the wonderful thing is how many of these people have come in different ways. Social media plays a big role.”

“The game too: you slip into the role of Lando Norris and drive down the same track as Lando. That’s very attractive to a lot of young fans. It wasn’t there seven years ago, it wasn’t really planned. So we open up the sport and make it more attractive. Yes, there is. Exclusive items of course. But there are also items that all fans can participate in.”

Las vigas

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A question: “Your other goal was to expand the sport in the United States. They added Miami this year. Next year we will have a third race in the United States in Las Vegas. What other areas do you want to advance in the future?”
Domenicali: “There are other regions in the world that would like to have Formula 1. And I think one of the areas we want to develop is the African region because we are a world championship after all. I think we are working very hard for that to make sure we have a grand prix in this region very soon.” .

“Then there is the interest of the Far East. And of course we don’t want to lose Europe’s interest because we were born here. And we will stay here because I hear so many incorrect voices. The beauty of the current situation is that we have so many options.”

A question: “One of the most important strategies for the future is the transition to 100 percent sustainable fuels, which we will be doing in 2026. The world’s largest annual sporting event is a showcase.”
Domenicali: “I would say that too. And I think we want to be realistic. We want to see how things evolve right away. And we think this is an option that will allow manufacturers to have credibility in one of the dimensions that is also profitable for them.”

“With all due respect, but to believe that electrification will take over the entire world in a couple of years – we know that is not possible. That is why we believe that the strategic decision to be sustainable with hybrids is also true from a technical point of view and that is why we have great interest from other manufacturers to work With us. “

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no: “Obviously sport has a lot of positive attributes. We think it can be a positive thing to go to places like Africa and expand the audience and interest in motorsports around the world. It’s not necessarily where we make the most money. But if you Investing for the long-term, we think this is the right approach.”

“We think about sustainability. There are 250 million cars in the United States, and 200 million of them drive them. They last about 11 years or more on average, people buy used cars. At best, we have 15 to 17 million new cars. Cars in year. Even if a third or half of it was electric, it would take a long time to get 200 million cars off the road.”

“If we really want to do something about carbon emissions, the right and better solution is to find other ways to power the 200 million existing cars. I’m not saying we will solve all of that. But if we do based on this knowledge, if we can contribute to our fuel work sustainable, I think that’s a win-win.”

A question: “We’ve talked about the five years that I’ve owned Liberty Media and I’ve done a lot of what I promised. What are the next five years?”
no: “We are fortunate to be able to run a company that is 72 years old, so we are thinking about the long-term future and where it is going.”

“We feel very interested now. We want to keep that interest growing on a larger scale. And when we do things like go to Africa and do something for sustainability, we think about how we can build this 72-year-old company over the next five years and five years after That. There is tremendous momentum now and we are keen to capitalize on it. Not just financially, but in terms of the breadth of the sport.”