Toto Wolff believes Formula 1 will see less money coming from circuits in the future, and that other revenue sources need to be looked at rather than increasing hosting fees for tracks.
The topic of circuit fees has become increasingly prevalent in the Liberty Media era of Formula 1, with Silverstone notoriously activating a break in its contract – citing costs as the reason.
Silverstone isn’t alone in this fear of costs, with several other tracks echoing the British Grand Prix host’s sentiments. The most recent victim of these cost increases is Hockenheim, which has had an on-off relationship with the Formula 1 calendar for many years. Whilst the German track will be holding a race this year, Hockenheim’s Marketing Director Jorn Teske said they could not continue under current conditions.
Adding a team’s perspective to the circuit fees debate, Wolff said that the business model created by Bernie Ecclestone – having circuits pay to host races – isn’t “economically justified“, and that with new owners Liberty Media taking over, it’s understandable that circuits will try to renegotiate terms.
“Paying for the right to have a race is one of the three main sources of income under the previous business model that Bernie created,” Wolff said in Monaco.
“He had an exceptional talent for making these contracts. He knew how to squeeze every last cent out of them for the benefit of shareholders and the teams.
“But I’m not sure it was an entirely stable and economically justified business model.
“Some promoters found themselves in a very difficult situation, so it is understandable that when the regime changes, they will seek a review.
“But I’m sure that the leaders of the championship will find the right solution and be able to agree with the promoters.”
Commenting on where funds could come from if not from circuits, the Mercedes AMG Petronas Motorsport Executive Director said previously ignored channels – like digital technologies – could be used to bolster revenue.
“What is clear is that in future this income item will bring in less money, so it is necessary to develop areas such as digital technologies and other alternative sources.“