GRAND PRIX RACING SPORT AT CRISIS POINT AS SPONSORS EXAMINE COSTS

Press, Volume CIII, Issue 30631, 23 December 1964, Page 12

GRAND PRIX RACING SPORT AT CRISIS POINT AS SPONSORS EXAMINE COSTS

[By CHRISTOPHER TUGENDHAT in the

"Financial Times”)

(Reprinted by arrangement)

Whatever happens on the football field, in the battle for the Ashes, or at Epsom on Derby Day, Britain rules the roost in international Grand Prix motor racing. Most of the best drivers are British—including this year’s world champion John Surtees and last year’s winner Jim Clark—and most of the best cars are British too. Of the big-five names 8.R.M., Brabham, Cooper, and Lotus all come from this country 7 ; Ferrari is the only top foreigner. In a few years’ time this situation may change as the Japanese Honda has recently* begun to take an interest in the sport. But for the moment nobodv is very worried.

The racing companies are more concerned about money, and this week their anxieties have been revealed to the public by two disturbing items of news. First of all it was reported that the oil majors, who are motor-racing companies’ biggest backers are taking a close look at the level of their contributions to the sport. Then came an announcement from British Racing Partnership that it has decided to withdraw from Formula I racing, which means the big grand prix, owing to lack of money. B.R.P. is one of the most important of the smaller British racing car companies, and is owned by Mr Ken Gregory in conjunction with Stirling Moss and Mr Moss’s father. Oil Companies’ Plans Not surprisingly under these circumstances, fears are now being expressed about the whole future of motor racing and especially about Britain’s pre-eminent position. There is no need though to start writing the obituary notices. Neither the sport nor Britain’s position in it are in imminent danger of collapse. Although the oil companies, which in this case means principally Shell, Esso, and 8.P., are “reviewing their plans” their present aim is to prevent their expenditure from rising rather than to make cuts in their contributions.

Moreover there are signs that Dunlop may shortly be joined in its large-scale support of the sport by one or two other tyre manufacturers, and there may be scope for attracting more industrial companies as sponsors for publicity reasons in addition to the car component manufacturers, such as Lucas and Ferodo. Nevertheless there is no doubt that the companies involved in grand prix racing are in the grip of a financial squeeze. They will need more money in the future and they will not worry about the source. Costs are rising all the time. Mr Ken Gregory has found that whereas five years ago he could buy a complete racing car for £2500 he would now have to spend £lO,OOO. Formula I Changes In the next few years the rate of increase is expected to be even faster. In 1966 the Formula I capacity is being raised from its present

1] litres to three litres. New and more expensive engines' will therefore have to be built and new and larger cars will be required to carry them. To race in the world championship a team must

have at least two cars each with at least two engines, and

it has been estimated that the cost of buying the necessary engines will be about £28,000, without taking into account new gearboxes and chassis.

Probably the best-equipped companies to withstand the effects of the change are Owen Organisation, and 8.R.M., a part of the Rubery Ferrari since they both make their own engines. The other English concerns have to buy their engines either from B.R.M. or Coventry Climax (owned by Jaguar). In an attempt to ensure that the large sums of money spent on preparing their cars for races are not entirely wasted, the big four British companies—B.R.M., Lotus, Cooper and Brabham—are willing to negotiate together with the race track organisers. Earlier this year, for instance, they threatened to boycott the Monaco Grand Prix for insisting on running qualifying heats instead of for two cars from each team, guaranteeing a starting place

On entering a race, both the works team and the drivers are paid starting money, which may be as much as £5OO for a star driver. But for the companies running the teams neither the starting money nor the prizes, which are a good deal less than in horse racing, for example, are sufficient to finance their activities. They have to have help from outside. The oil companies, whose contributions to Formula I racing are estimated to be about £] million a year, are easily the most important source. In addition to money the oil companies provide free fuel and lubricants, and sometimes a good deal of technical help in the design of new engines. Most of the sponsors also pay retainers to the drivers and give them

m bonuses for important success. ; Sometimes these are very > large and from all sources a •jtop flight driver may earn over £30,000 a year. Most 1 good drivers, however, must : be content with much less.

Publicity Value

Although grand prix racing may help the oil companies improve their fuels and lubricants, undoubtedly their main interest in the sport is its publicity value.

As a result, the oil companies are always willing to move their money about from one branch of motor sport to another in search of victory. Thus Shell, which has B.R.M. and Ferrari under its wing, is particularly interested in Formula 1 grand prix racing. By contrast 8.P., which has only Cooper in the Formula I field but close links with the successful Saab team, is far more devoted to rallies. In rallies the role of the sponsor companies is much less important than in the grand prix field. Although the big motor manufacturers are naturally delighted to receive free fuel and lubricants, and the benefit of the route reconnaissances carried out by the oil companies, this assistance is not a matter of life and death. They could. I if they so choose, continue to compete unaided.

In grand prix racing the support is essential. But the sponsors themselves are not certain where their best interests lie. The advantage of the rallies is that the cars involved look like production models, and the ordinary motorist can therefore see a connexion between his car and the one on the track. Against this, grand prix racing has the advantage of star quality. Some of the sponsors are beginning to feel that this appeal is weakening and that the sport is becoming too much of a circus with a group of small cars chasing each other round basically similar tracks in different parts of the world. The task of the new big Formula I cars will be to bring back some of the glamour to the sport.