cota

well said

 

being a Texan, I do not think the Texas government has a problem spending the money as long as the money is made back, but it does not seem that the F1 race is bringing in the money that it once was.

I went this this, as well as all the previous years, the rain was a serious problem (this was not a regular rain event, many areas in the region set rain fall records), and I personally know people who stayed home because of the rain. No doubt that hurt ticket sales at the track, and also local businesses who were counting on people coming to Austin.

I also feel that the track and race organizers have done a poor job the last 2 races, the infrastructure has not been improved, you would think that they would have added a few more TVs, or even some real bathrooms, the whole place seems very minimalist. I am not sure I got my money's worth (and that has nothing to do with the rain) and I am not sure I will be going back next season.

 

I read this in Autosport:

"It is understood the state committed to providing a subsidy of $250million over the course of 10 years, based on the economic impact of F1 to the region."

So, one presumes that the business plan for COTA was drawn with that expectation.

Now, if the state council , the local authorities or whoever declares they got their sums wrong and decides to reduce their contribution, one can hardly blame Bernie for that!!

It's a political decision at local level which has nothing to do with F1.

 

Bernie has been as bad or worse with his own Brit public. Posturing his his forte. No worse than any other billionaire with his hand out for the government to keep something afloat. Ask the major banks/insurance companies etc.

 

Business is business, and it's not charity.

I thought that they would now that in Texas, of all places!!

 

COTA chairman: I think we’re screwed


COTA chairman: I think we're screwed - PlanetF1 : PlanetF1



The Circuit of the Americas (COTA) has been hit by a funding cut, leading to doubts over the future of the United States Grand Prix.
The Texas track made its Formula 1 debut in 2012 and the first four editions have been a major success, but the event is facing uncertainty after the State of Texas announced a 20 percent reduction in funding.
The first three races received $25m per year, but it dropped to $19 million for this year's grand prix, leaving the circuit with a $6m shortfall on top of the reduction in ticket sales due to bad weather.
"To use a technical term, I think we're screwed," circuit chairman Bobby Epstein told the American-Statesman.
"It hit us cold. No one could foresee this coming. But the big question now is, 'Is the race coming back?'"
The state, which justifies the reduction in funding on grounds that the economic impact of the event on the area has dropped, could still face a court challenge from COTA.
"An entire facility was constructed based on that deal," COTA spokesperson Dave Shaw added. "If the calculation changes now, that's effectively changed the terms of the deal."
Formula 1 supremo Bernoe Ecclestone, who has recently revealed that he is hoping to add more American races to the calendar, admits Texas is up against it.
"If it's changed, it's going to be difficult to continue the race in Austin," he said.

 

I think it's a realy pity when a venue is created to host a world championship event, on the promises that it would be supported, only to fail because expectations are no longer met.

It's nothing new; politicians in many countries have raised hopes and encouraged venues to open, heralding their benefits to the state, the region, or the town and commiting public money to partly fund them.

Then, when the economic benefit is no longer felt and the political return is diminishing, all the promises are reviewed and the promoters are left high and dry to meet the creditors.

It happened in Europe, in Asia, in Africa, where trace tracks, velodromes, ice rinks, ski resorts, stadiums, were abandoned after a few years and became ghosts of the past. COTA could become another casualty of political intrigues.

 

Soon CoTA will be forced to lower track rental rates or become the new location for Austin's Swapmeet like they do with old drive-in movie locations. The track will fall into disrepair with big chucks of asphalt missing and patches, leaks in the garage roofs, and missing toilet tank covers. If you want a look at CoTA's future do a race weekend at Mid-O.

 

If it can't stand on its own two feet it's ok to end.

Sorry.

Kai

 

Yep. It's supposed to support itself. It needs to re-invent itself to do just that.

Take away the government golden parachute and make them fight for our dollars to come there.

Note to COTA: Elton John just ain't cuttin' it. Take a trip to Singapore and see how the extra events should REALLY by run.

 

Really?

I haven't been to either event, but I'm pretty sure it would make no difference to me who or what was playing the after event gig - Elton John or some complete unknown, I'm going there to watch the cars, not the gig......

Having said that, what are they doing in Singapore to get my attention?

Cheers,
Ian

 

What happens in Singapore stays in Singapore, lol.

Kai

 

Well, the flip side is Bernie may strangle COTA so hard that it dies and he and FOM get NOTHING from a US GP.

Sometimes you have to lower prices in order to get the sale.

That said, FOM could probably swap the US GP for some other location in a developing country, one that was run by a rich oligarch willing to throw money at them, and not be bothered by all the whining from COTA.

-F

 

Damn, I hope this isn't true.

 

We have been here before when a similar thing happened with the Indy GP. And we know how that ended.

I am glad I went to Austin once and have seen it.

 

I don't think that Bernie is really concerned about loosing Austin.

He will find another country desperate to put its money on the table to have a GP - Serbia? Poland? Netherlands? etc...

The US GP is a long saga, moving from place to place, and always ending in tears.

 

Not sure the current fate of COTA, but it's not hope for this future.
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Throw in "guns & ammo" and they've got all the bases covered!......

"Beer, bait & ammo."

What could possibly go wrong?

Cheers,
Ian

 

The basic economics of COTA's predicament are simple ... bleak, but simple.

The deal with Bernie, signed just prior to the first race, included a $25MM sanctioning fee, of course ... but that number was contracted to increase, to the tune of 5 ~ 10% per year.

The METF number was estimated to be $25MM per year ... but that number was subject to change, downward or even upward, depending on assessed "economic impact" to the area.

So the idea that the state of Texas would be paying Bernie's sanctioning fee isn't really accurate ... Bernie's sanctioning fee just shows up as an "expense item" every year, while the METF funding simply shows up on the other side of the ledger. Two things are, however, invariably true :

#1. Bernie has no love for Austin, anymore than he has love for Monaco, Spa, Monza, NYC or any other F1 venue (real or imagined). Demand for races simply exceeds the calendar's ability to supply ... that's all Bernie cares about.

#2. Given #1, no track can exist for long (except for those grandfathered-in) without substantial government/taxpayer support. The simple reason is that there are plenty of venues with substantial government money bidding to get on the calendar. Private enterprise, alone, can't possibly compete.

Bottom line : Without substantial METF support, COTA is, most likely, "screwed" ... at least, for hosting F1.

 

What a wonderful position to be in!..... I'd be willing to bet the WEC/WRC/ANother guys *dream* about being oversubscribed!.....

I hope you're mistaken.

There are however many GP's that don't depend on Gov't money......

Cheers,
Ian