Hockenheim the Latest Victim of Increasing Hosting Fees, May Drop F1

by Tom Jeffries
Empty seats at the Hockenheimring

Rising circuit fees may be set to claim another race on the Formula 1 calendar, with German Grand Prix hosts Hockenheim saying they “cannot prolong under current conditions“.

Circuit fees have become an increasingly prevalent issue in the last few years, with Formula 1 stalwart Silverstone famously breaking a contract to host the British Grand Prix last year, revealing that the circuit lost nearly five million pounds hosting the 2016 British Grand Prix.

More recently Autodromo Nazionale Monza owners Automobile Club of Milan told the press in February that “if conditions change we can no longer guarantee the future of the club“.

The latest track to discuss the possibility of not hosting Formula 1 races due to cost is the Hockenheimring. The circuit returned to the calendar for 2018 having missed last year’s race due to an inability to reach an agreement with former F1 owner Bernie Ecclestone – the track saying there “was no offer that would have excluded all economic risks“. Whilst they will host a race this year, Marketing Director Jorn Teske said money could once again see the German Grand Prix fall off the calendar.

We’re aiming to host a GP in the future, and we’d like to have it in the future, but the key point is we cannot prolong under current conditions,” said Teske.

We would like to have a contract which will take the risk from us, this is the basic point.

We are not speaking about the fee, we are speaking about a new contract where we definitely have no risk.

We have a circuit which does not receive any financial support from anybody, neither from the state nor from the region nor from economic companies, so we have to make and manage everything for ourselves.

We had some losses in the past. We had a 10-year contract, and we fulfilled this contract, even though we had some better and some worse years.

Now’s the time that we cannot continue in the same way. We would be very, very happy to have F1 in Germany, not only for us, but especially for the fans. But we have to change the basics.

With fees too high for the Hockenheimring, Teske says the track was asked how much an acceptable fee would be. This, however, isn’t the question they think F1 should be asking – instead saying that changing the business model to be about revenue share would make it better for both the businesses and the fans alike.

We are always talking about fees, and then we were asked ‘how much fee would you pay to host the race?

This is not our question, because we think we should restructure the business model.

This could be a track rental [by F1 or a third-party promoter], or it could be a sharing of ticket income, and sharing of costs.

So this is now a question of the negotiations, how it could end up. But there are many models which could work without risk.

No fee, or a basic fee, just earning the costs, and then sharing the ticket income.

We presented our ideas, we presented the figures, very transparent, very clear, in the details, and now they [F1] have to think about it.

But it’s not that easy because it’s a financial decision they have to take. Do they take the big money? Then we’re out.

Or do they believe in the importance of the traditional race tracks, and an important automotive country, in Germany?

The 2018 German Grand Prix will take place on 22nd July. Fingers crossed it isn’t the last.

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