BRDC's £30m solution to keep British Grand Prix at Silverstone

When, in December 2009, it was announced that Silverstone had secured a 17-deal to host the British Grand Prix from 2010, British race fans, indeed the sport, breathed a huge sigh of relief.

The deal brought to an end a worrying period during which it was feared that Britain might lose its round of the Formula One World Championship, a situation bordering on the unthinkable considering the nation’s role in the history of the sport.

Bernie Ecclestone, a long-time critic of the circuit had seen deal with Brands Hatch and Donington fall apart, but finally, having agreed to a major overhaul of the circuit and its facilities, and signed a 17-year contract that saw the hosting fee increase year-upon-year, the future of the race was assured. Trebles all round.

Shortly after the deal was agreed, Pitpass ran a piece predicting by how much ticket prices would need to rise over the years that followed as the circuit’s owners – the British Racing Drivers’ Club (BRDC) – sought not only to cover the costs of the ‘improvements’ to the circuit but the ever increasing hosting fee.

At the time our figures were widely lambasted, with Silverstone leading the pack in rubbishing our predictions.

Indeed, our figures were wrong, for in fact they proved somewhat conservative, as we underestimated the amount by which ticket prices would need to rise.

In January 2017, just eight years into the contract, BRDC chairman, John Grant, wrote to the club’s members, spelling out the clear warning that while keen to retain the event the club could no longer ignore the “elephant in the room” in terms of the fact that hosting the Grand Prix left the BRDC facing “potentially ruinous risk”.

It was at this time that he suggested a contract break, by which the BRDC could exercise a clause in its contract that would allow it to end the deal after the 2019 event.

Again, the suggestion was widely dismissed, yet months later, in the days leading up to the British Grand Prix, as the sport’s new owners staged a promotional event in London, the BRDC went ahead and exercised the clause, meaning that 2019 would indeed be the last staging of the event at Silverstone.

Since then there has been much rhetoric, but the bottom line is that there has been no real progress. The BRDC cannot afford to continue staging the race under the terms of the existing deal, while the sport’s owners, fully aware that other race promoters will be watching the situation with keen interest, cannot suddenly turn around and offer Silverstone a ‘nice price’.

Indeed, the sport’s owners, though making much of Silverstone‘s vital place in the history of the sport, and the fact that it is a fan (and driver) favourite, have made no secret of the fact that what they want – what they really, really want – is a race on the streets of the nation’s capital.

Despite Chase Carey’s assurances that much is happening behind the scenes, the fact is that as it stands, in just seven months Silverstone will host its last F1 Grand Prix. Indeed the BRDC already looking at various options – including loans – whereby it will be able to pay the fee for the final race which will be due shortly after.

Though hosting the Grand Prix has seen the BRDC’s losses mount to £51.3m over the six years to the end of 2017, the club doesn’t want to drop the event. Indeed, it doesn’t even want to profit from hosting the Grand Prix, it merely doesn’t want to run the race at a loss.

In a bold move, the club has now offered to hand over the £30m it receives from ticket sales directly to the sport’s owners in a last ditch attempt to save the race.

“The ticket sales would go to Liberty,” a senior member of the BRDC tells the Daily Mail, “but we could provide all the management to take the ticketing, all the officials, all the organisation.

In return, Liberty would “pay us a reasonable amount to cover our overheads for the use of the track and job done. That’s not an unreasonable proposition and that’s what was offered to them.

“All logic says they are going to come to an agreement but there is no great urgency for it,” adds the source. “There is no looming deadline, that’s the point. It’s a year before they set the (2020) calendar so I think there’s no great pressure on anyone to resolve it. I think they will come to an agreement in time.”

In 2017, the BRDC’s revenue increased by 7% to £58.8m, however, this represented a mere £600k in pre-tax profit. The accounts make clear that “approximately half of annual revenue continues to be generated by a single event, the British Grand Prix”.

In its attempts to become less reliant on the Grand Prix, the BRDC has worked hard to make Silverstone a more attractive proposition for other activities, including a heritage centre, a (Hilton) hotel over-looking the track, even luxury villas, and a family entertainment complex.

“The BRDC believe, quite rightly, that we have a duty, as the owner of Silverstone, to host the British Grand Prix and all we say is that we don’t want to host it at a loss,” explains the source.

“We are not wanting to make a profit on it,” they insist. “We don’t need to make a profit on it any more because we have got all these other activities but one thing we are not going to do is put money is somebody else’s pocket just to make a loss ourselves.”

Their comment is backed up by Silverstone managing director Stuart Pringle, who recently admitted: “Lord knows we want to keep the Grand Prix, but not at any price. We’re going to have a broader, more diverse business that can survive without it. But we’d much rather have one with it.”

At a time of ‘good will to all men’, and with the sport’s owners forever telling us how much they think of “the fans”, it very much appears to be a case of… over to you Mr Carey.