That Formula 1 stages its first grand prix in Miami during 2022’s second quarter – thus likely back-to-backed with Montreal’s round – marks the end of F1’s longest-running soap opera. Forget Kimi Raikkonen’s much-rumoured move to Ferrari in 2006 (that episode lasted a year before confirmation) or recurring talk of Nigel Mansell returning to F1 during the mid-1990s (two years to not happen): Miami’s saga stretches back to 2016.
Numerous legal, political and societal obstacles plus varied changes to the originally designed layout endangered the project. At one stage all indicators were that the race was dead, yet F1 remained bullish about the Floridian race.
An additional event in the country with the world’s highest GDP – $20 trillion, versus China on two-thirds that – makes obvious commercial sense. Yet the lengths Liberty went to in order to secure a race in a country with a lukewarm relationship – at best – with F1 are nothing short of astounding. On Sunday, F1, though, announced a 10-year deal – rather than the typical three or five – although there are likely to be break options.
The USA has held more rounds of the world championship than anywhere bar Italy, Britain and Germany. Yet its 70 races were hosted by a total of 10 circuits, under a variety of titles, with at times as many as three events in a season or none for five years and more. Since 1958 F1 has visited Sebring in Florida, Riverside on the West Coast, Watkins Glen in New York State, Long Beach (California), Las Vegas, Detroit, Dallas, Phoenix, Indianapolis and Austin.
The USA’s average of seven grands prix per circuit underscores this tempestuous relationship, for Italy has hosted the most rounds (101) at four circuits (the next highest tally), while Monaco has staged 65 grands prix since the inception of the world championship in 1950, at all one venue. True, the principality has no alternate venue, but between 1955 and last year (cancelled due to Covid-19) it did not skip a year.
As part of F1’s push for a race in Miami it went to extra-special efforts to promote itself on the Florida Peninsula, hosting a Fan Fest there in October 2018 with a view to an inaugural race a year later. But, even before the festival was staged, the inaugural date was postponed to 2020.
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“We are taking a long-term view and as a result, we have decided, in consultation with the Miami authorities, to postpone sign-off until later in the summer, with the aim of running the first Formula 1 Miami Grand Prix in the 2020 season,” said F1’s then commercial managing director Sean Bratches at the time.
Although the 2020 season was blighted by the pandemic, it did not affect F1’s plans for Miami simply as no deal had been struck and it did not feature on FIA calendars, let alone any draft listing. Yet, during the same period, F1 announced a round in Vietnam (now cancelled), plus its return to Zandvoort. That said, a Dutch round is a no-brainer given Max Verstappen’s popularity, so relatively little effort was required.
As related here, a source close to the Miami project previously told this author that there was considerable history between history between Liberty and RSE Ventures, a Miami-based real estate and sports promotion conglomerate controlled by billionaire Stephen Ross – who this week was linked by The Times to the ill-fated European Super League football tournament, a concept imported from the USA.
Liberty and RSE. In 2015 Ross and Co had teamed with the Qatari sovereign wealth to pitch for the 35.5% stake in F1’s commercial rights then held by CVC. Although the bid ultimately failed, Ross’ appetite had been whetted, and RSE bid against Liberty in September 2015, sending the price soaring.
The source was adamant that Liberty had requested RSE to back off, with the pay-off being a trophy race in Miami – which ticks all boxes for Liberty via an additional race on US territory and for RSE, based in Miami. At the time (September 2017) our source was adamant that a race deal would be struck regardless “of what it takes”, adding ‘In US financial circles word is bond, and Liberty gave its word to [Stephen] Ross.”
Then, in 2018 it was confirmed that RSE Ventures, a company controlled by real estate entrepreneur Stephen Ross and owner of the Miami Dolphins NFL team, had been appointed as promoter of the race, assuming all necessary permissions were obtained. Tom Garfinkel, RSE vice chairman and president and CEO of the Miami Dolphins and Hard Rock Stadium, was named as managing partner.
The approval process was fraught with legal and other challenges, so a year later messages were posted on the f1miamigp.com website – owned by Formula One Licensing BV, a subsidiary of the commercial rights holder – urging fans to support the race via a petition sent directly by email to various Miami Dade County commissioners.
“A chance to host an event of this magnitude and global recognition is rare, and passing up this opportunity would be a disservice to the community,” the petition concluded. “The most important auto racing event in the world is looking to make a home in Miami! It would be shameful and embarrassing for Miami do anything except welcome F1 with open arms.”
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In the interim allegations of racism surfaced, while a civil rights lawsuit was also filed. In order to appease protesters the promoters promised to revise the track layout to by-pass the 199th Street arterial route, to erect noise reduction barriers and monitor air quality throughout race weekend.
All in, extraordinary lengths were gone to all round to secure a single event in a specific location for a specific promoter, yet over a period of close on four years had elapsed yet no approvals had been granted. Had the same focus been applied to Africa, the continent would likely have at least five rounds per season confirmed for the next 50 years…
A fortnight ago it emerged that (recently elected) mayor of Miami Gardens Rodney Harris had managed to amass the required number of votes to permit the race to go ahead from 2022 in the Hard Rock Stadium and the surrounding area. The proposal included a $5 million community package plus science, technology, engineering, and mathematics (STEM) project for students, was tabled for April 14th and approved accordingly.
Which brings us to Sunday’s Miami confirmation in Imola. Not only was Garfinkel present at the Italian circuit, but so were Liberty Media president and chief executive officer Greg Maffei –boss to F1 president and CEO Stefano Domenicali (also present) – and F1 executive chairman Chase Carey, Stefano’s predecessor. It was extraordinary show of firepower which brought to mind those ‘word to Ross’ comments.
Domenicali confirmed 2022’s ‘second quarter’ as the likely calendar slot – while Bratches previously spoke of a May date prior to the start of the European season. That would entail criss-crossing the Atlantic thrice in a year (May, June and October/November) so it clearly makes sense to instead pair the race with Canada’s round, given F1’s sustainability drives and social responsibilities.
The two venues are sufficiently far apart (2,200 kilometres) to not cannibalise each other while providing feasible double-event packages for foreign fans, much as Montreal and Indianapolis benefitted symbiotically during the noughties. Such twinning also helps share Canada’s transportation costs while enabling the Texan, Mexican and Brazilian rounds to split the year-end triple header costs.
Domenicali confirmed that the 2022 F1 calendar will list 23 races as per this year, pointing to an existing round dropping out. The smart money is on Barcelona as its current deal is for this year only, but in the longer-term whichever event does drop off could well return should F1 adopt rotational calendars. Thus, it could be Spain in 2022 and Spa in 2023, or whatever.
Such rotations are not, of course, new: Hockenheim and Nürburgring alternated events, admittedly always on German soil, from 2007 to 2014. Whether such a schedule works effectively across borders remains to be seen, but there are no doubts that it has pitfalls: expensive track upgrades can only, for example, be defrayed over alternate years, while marketing programmes are stop-start rather than continuous.
While there are no doubts that the world championship is Eurocentric when measured against population – although with three events in a compact area the Middle Eastern events now arguably shade Europe on a per capita basis – if rotational deals are indeed the panacea, why did Liberty not attempt to strike a timeshare deal between Austin and Miami? The 2016 handshake, of course…
Bearing in mind that the Miami Grand Prix is not additional to the current calendar, F1 teams are concerned about the exact nature of the deal – particularly given the RSE angle – for commercially it needs to be more lucrative than Barcelona, or whichever race drops out, given that European races are cheaper to attend than flyways. Splitting costs with Montreal goes some way towards breakeven, but is it enough?
There are no doubts, though, that an additional grand prix in the USA is welcome news for F1, particularly from a sponsorship perspective – Aston Martin is expanding its US operation and recently signed New Jersey-based Cognizant as title partner. Red Bull hooked Oracle, while its energy drinks marketers would surely welcome a second platform in the land of competitor Monster, a Mercedes sponsor.
Williams owner Dorilton Capital is US-based, while McLaren is vigorously chasing the USA market with its IndyCar programme and F1 can only help in this regard, while Mercedes last year sold almost 80,000 cars in the USA, only marginally down on the previous year’s numbers despite Covid. North America remains Ferrari’s biggest market, and, of course, the company is listed on the New York Stock Exchange.
F1’s drive for sustainable fuels should make it attractive to manufacturers such as Porsche, Audi and the Hyundai group, and a second race in the USA is likely to prove a better draw-card than remaining in Spain.
The race also provides a backstop should Austin drop out – bearing in mind the average seven-race life expectancy and the Texan circuit now having hosted eight editions – after its contract expires next year. There is talk that the Texas Big Event fund, which indirectly sponsors Austin’s race via tax rebates and refunds, could be reduced going forward, so a distinct possibility exists that the F1 race is no longer viable.
Perversely, though, the markets did not react as positively as expected: On April 7th, a week before the Miami Gardens council meeting FWONK shares traded at $45.83; one week later the price had dipped to $44.84 and at time of writing on Tuesday it hovered around $45.43. Has Liberty possibly overestimated the perceived value of a race on home soil, or have investors realised that the bottom-line benefit is not what it seemed?
Equally, if Liberty is prepared to drop a European race in favour of Miami – of all places – what chance other races in F1’s heartland fall by the wayside in favour of rounds in Africa or Asia, where rotation is more complex due to geographic factors? It can be argued that Spanish fans are able to easily travel to, say, France or Monaco on alternate years should their race fall out, but those in Vietnam are unlikely to travel to Kyalami or vice versa.
“Vietnam is not any more in the calendar but it’s still an open option,” Domenicali told RaceFans in February. “It has been an incredible investment and therefore it’s still on the table of discussion for a future event.”
Other potential race promoters have also expressed interest in F1, he said. “That is basically in north Africa [and] South Africa, that I can tell.”
F1 always was going to head for Miami – given the alleged deal it was only a matter of time, and hence Domenicali included a race in Florida in his projections within a few weeks of taking office while confirming that an Austin renewal remains outstanding.
“Our strategy in the future will be to be more present in the US with more than one grand prix,” he said. “Austin has been very important in the last years of our calendar. It will be also in the future and we are discussing with them the renewal of the agreement.
“And of course Miami is a place where we are looking. I cannot say more than that. But for sure, there is a big interest from both parties to be there.”
All F1 now needs to do is beat the odds by ensuring that the event runs its full 10-year contractual term. If the USA’s historical relationship with F1 is any guide, that won’t be easy.
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