How the Gulf and the US are changing F1
This week simply reinforced arguably the two greatest influences on Formula One today: the Gulf and the United States.
First, General Motors made a huge breakthrough in talks to enter the sport with Cadillac, bringing iconic American branding to the pinnacle of motorsport.
Days later, Qatar’s sovereign wealth fund agreed to buy a chunky minority stake in the soon-to-be Audi F1 racing team that is currently known as Sauber.
These developments underscore twin drivers of F1’s growth under US group Liberty Media, which acquired F1 in an $8bn deal in 2017.
F1 no longer struggles for relevance in the US. Liberty Media has added Miami and Las Vegas to the calendar, setting new standards for glamorous destinations. Viewership and attendance has multiplied in the US. American investors such as Arctos Partners and RedBird Capital have bought into teams. Blue-chip US brands sponsor the sport.
At the same time, F1 has added lucrative races in Saudi Arabia and Qatar. The relevant sponsors have joined the travelling circus. Saudi state oil company Aramco and Qatar Airways are major sponsors.
This growth is the envy of many sports around the world. Despite its European origins, F1 has been able to pursue a global vision that remains awkward for football. Just look at the furore caused by the European Super League or any suggestion that the Premier League should host regular season matches in the US.
F1 also benefits from a model that is more in keeping with US sporting traditions. There’s no promotion or relegation, meaning that teams are guaranteed a spot on the grid. And the introduction of a cost cap, limiting how much teams can spend on developing cars, has fundamentally improved the economics for investors.
OK, General Motors isn’t the first American team on the grid. Haas has been racing in F1 since 2016, but the North Carolina-headquartered team has never won a race and relies on Ferrari to provide engines. Eventually, GM wants to produce its own engines, a major sign of confidence in the sport.
Adding Cadillac to the grid could help boost fandom in the US, but do American fans want to support a loser? It will be difficult to become competitive quickly.
Logan Sargeant’s recent experience reinforces the point that it isn’t enough simply to be American. Williams replaced the Florida-born driver earlier this season due to performance struggles.
It’s a similar story for the QIA. Sure, it underscores Qatar’s commitment to F1. But Sauber is bottom of the constructors’ championship this year, with zero points scored. It will take a major effort to improve.