Past the race track: how not to splurge on Formula 1

What happens in the Sochi racetrack between races and how the money is made. 
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In the "Formula 1", the first day of May in Sochi will host the third in the history of the Grand Prix of Russia. Black Sea highway appeared in the World Championship calendar in 2014: five years in the Olympic Park to the south of the Adler built the most modern and most technologically advanced racing circuit in the former Soviet space. The first two stages of "Formula 1" in Sochi took place in October. At first it was a necessary measure - the summer of 2014 Sochi Autodrome has not yet been completed, and therefore could not physically take the race before. In 2015 the date was left on the calendar, "Formula 1" by inertia.

For the season 2016 the organizers of the Grand Prix of Russia agreed to postpone the date of 1 May. According to the general promoter of the Sochi stage Sergei Vorobyov, this day is the best for the Russian fans, who are accustomed to the May holidays: in Sochi believe that the new date will help sell tickets faster. Five days before the start of the fans pulled down 85% of the 55 000 tickets for the Grand Prix of Russia.

In total, the stage of "Formula-1" takes three days - Friday, Saturday and Sunday. On the first day of training held in the second - the qualification, but in the trTille - the race itself, for which the majority of fans come. All the rest of the track have to pay for themselves. For racing complex is not idle and does not generate losses from scratch, Sochi Autodrome is constantly looking for new ways of earning. Forbes figured out how the Russian route "Formula 1" fails to balance on the verge of break-even.

Formula costs

The main thing you need to know about the stages of "Formula 1": they are unprofitable for organizers. The only profitable World Cup race is the Monaco Grand Prix - only the country does not pay the company's Formula One Management (FOM) fee for the right to host the race, and he keeps all advertising revenues. The rest have harder. Firstly, FOM on the organizer's rights and the holder of the commercial rights to the "Formula 1" takes itself profits from advertising placed on the track. Secondly, the company is forcing organizers of races pay an annual fee. Its size varies from a few million dollars for the historic Grand Prix like Italy or Germany, to about $ 60 million for oil countries such as Bahror to the United Arab Emirates.

Russia takes place here "rich": the contribution amount reached a record $ 60 million more in 2014 and since then has only grown. During the Grand Prix the only source of income for the Sochi racetrack tickets remain. However, even at 100% filling (as in 2014 and 2015 Grand Prix of Russia held a full house) to compensate for the 60 millionth fee still will not work.

"There are two types of costs of the stage," Formula 1 ": this royalty FOM and direct operating expenses, - explained Sergey Vorobyov. - Operating expenses - a sports organization, transport services and small marketing program. All costs for the organization, we cover the ticket income program. The cost of the license fee, "Formula 1" in 2014, we offset the state. Last year, the payment is partially financed by private investors. We are gradually going to ensure that the share of private capital in the conduct of Russia Grand Prix, "Formula 1" will increase. "

Who exactly took the private costs of the Grand Prix, Vorobev has not specified. Why Sochi racetrack patrons decided to remain incognito, promoter also told.
How not to splurge on racing

Apart from the "Formula 1" Sochi Autodrome takes several international and local racing series. For example, last year in Sochi the championship arrives bodybuilder the TCR, and this year the route will take the European Ferrari Challenge tournament. Also in Sochi are regularly stages a series of Russian ring races (RSKG) Youth "Formula 4" and polulyubitelsky Cup "MitDzhet". The last two races of the championship will support during the upcoming Grand Prix of Russia.

Usually on one track with the "Formula 1" stands for youth racing series GP2 and GP3. These competitions are considered a source of manpower for the "Formula 1": traditionally gets GP3 winner in GP2, GP2 and the strongest pilots eventually get to the World Cup. Both racing series Bernie Ecclestone controls - the same people who make the key decisions in the "Formula 1". Not surprisingly, for the arrival of GP2 and GP3 Ecclestone also requires a fee: This amount is several times less than the fee for the "Formula 1"for the organizers of the Grand Prix - another item of expenditure.

In 2016 Sochi Autodrome managed the unthinkable: the Russian route "Formula 1" got rid of the GP2 and GP3, in spite of the existing three-year contract. According to Vorobiev, the Russian track and guide the youth championships suspended the contract by mutual consent. Instead of the GP3 and GP2, "assist", "Formula-1" will be the Russian racing series. Arrivals "MitDzhetov" and "Formula 4" will be held between sessions of the "Formula 1" and, in fact, take the free route at a time, as members of the Grand Prix will be sitting in the garage. "For the bulk of the audience of the existence of national support races - that's a plus, - says Vorobyev. - We have an opportunity to communicate with fans through ticket operators who work with large groups of clients. Our viewers hear that ordinary guys can drive is not on public roads, and get behind the wheel «MitDzheta" and participate in one weekend with the "Formula 1", and the young athletes of the "Formula 4" has just arrived in the big races from karting. dlI was the main audience is closer. "

Of course, there are also material in addition to emotional reasons. Cup "MitDzhet" and "Formula 4" Formula One Management are paying for the right to use the route "Formula 1" during the weekend of the Grand Prix. The fee for one step in the hundreds of thousands of euros, told Forbes sports director Cup "MitDzhet" Boris Shulmeystera. Total costs "MitDzhetov" on the joint with the "Formula 1" stage exceed a million euros, the championship leader admitted Stanislav Serezhenkov: FOM fee in addition it includes organizational expenses and rent for racing cars awning. The pilots of the boxes will not be allowed - stationary building reserved for the teams, "Formula 1".

It is noteworthy that the Sochi Autodrome in the financial scheme is not involved: Russian track does not receive any contributions from any "MitDzhetov" or from the "Formula 4" for their participation in the race weekend. Financial gain circuit generates by saving on contributions to address GP2 and GP3. What is the Russian side is saved in the 'no youth series in Russia, Vorobyev, refused to answer, Citing the confidentiality of the contract with the structures of Bernie Ecclestone.
Single sponsor

In 2016, the first and only sponsor of the Sochi racetrack was the oil company "Lukoil". The company bought a fixed number of days on the racetrack: in these days many teams of "Lukoil" from different racing series have the opportunity to train on a single track, "Formula 1" in Russia. As part of the agreement, calculated until the end of 2019, was the renaming of the main stand in the "Tribune Lukoil". However, this title will disappear at the time of the Grand Prix, "Formula 1": the World Cup does not tolerate a third-party advertising. In the coming weekend branding "Lukoil" on the road should not be on the terms of the contract.

Another consequence of the beginning of cooperation was the visit to Sochi International Championship TCR. This involved a team championship, "Lukoil", but because the oil company decided to take on the costs of the Russian stage. The immediate phase of the organization is engaged in agency "Manuscript", "Lukoil" hired this computerNIJ for one race of the year. "Manuscript" owns the former manager of the first Russian pilot in the "Formula 1" Vitaly Petrov Oksana Kosachenko - after a career Petrov completed in "Manuscript" world championship focused on conducting various motorsport events in Russia. In the case of the Sochi stage TCR Kosachenko company may be called a contractor, and "Lukoil" - the client works.

Of course, TCR race does not collect such a large number of viewers as "Formula 1", and tickets for 400 rubles not allowed to recoup the holding phase. In this case, the Sochi Autodrome earns the audience, but on the organizers: if the "F1" pay for itself soon fact that other championships takes place exactly the opposite. "We as a race track we get the payment, which we consider fair," - concludes Vorobyev.
Toll road

In negonochnoe time Sochi Autodrome actively losing track rental. Major customers - dealers and car companies who arrange test drives for journalists and potential customers. Rent Sochi Autodrome with spotss to Sunday cost to the customer of 500 000 rubles per day. From Monday to Thursday, prices dropped to 300 000 rubles per day.

Additionally, guests will be able to stay in racing pits, which served fireballs "Formula-1" (7800 rubles per box), team houses where based team of engineers (59 000 rubles for the first floor of 99 000 rubles for all two-storey building), and even the entire paddock - street between the garages and houses. The latter will cost 100 000 rubles per day. Services have already benefited from Jaguar - Land Rover, Mercedes-Benz, Porsche, BMW and other companies. Among the clients of the Sochi racetrack there are non-automobile brands: appear in the list, Sberbank, "Megafon", MTS, Canon, Visa, and "Gazprom".

"Sochi Autodrome - this property and at the same time the company, which provides services on organization of events. Only such a model allows the circuit to break even - concludes Vorobyev. - We do not like to be the promoter of any of the activities, except for "Formula 1". If we got involved in the organization of other races, we would be much more difficult. It is therefore important to us that all otherIt has the same price tag 's default event.

In addition to test drives and networking events at the Sochi Autodrome are quite exotic and competitions. So, over the past year there was held a half-marathon and the race on speed wheelchairs. "Now the circuit does not generate a significant profit, - says head of the race track. - In fact, the amount of year-round year-round income and expenses are very close. But do not forget that in the framework of the Grand Prix, "Formula 1" of Russia and Sochi will know around the world. This effect is also evaluated. In the past year, the organizers stage in Mexico have published the results: only direct and indirect mediaeffekt of the Grand Prix, "Formula 1" are estimated at half a billion dollars. For the Grand Prix of Russia similar figures. "