Today, the British Racing Drivers’ Club (BRDC), the owners of the Silverstone racing circuit has formally triggered the break clause in its contract with Formula 1, now owned and managed by Liberty Media.
This means that unless a new contractual arrangement can be reached with Liberty, 2019 will be the last year that the British Grand Prix takes place at Silverstone.
BRDC made a net loss of £7.6m ($9.8m) over last two years hosting British Grand Prix, £2.8m ($3.6m) in 2015 and £4.8m ($6.1m) in 2016, and they’re expected to lose a similar amount this year.
John Grant, Chairman of the British Racing Drivers’ Club, said: “We have reached the tipping point where we can no longer let our passion for the sport rule our heads. It would not only risk the very future of Silverstone and the BRDC, but also the British motorsport community that depends on us.”
“This decision has been an extremely difficult one for us to take. The BRDC is at the heart of British motor racing and we have been promoting the interests of our sport and its fans for generations.”
— BRDC (@BRDCSilverstone) July 11, 2017
The BRDC has been the custodian of Silverstone for almost 70 years – owning and operating the circuit, which is the only venue licensed to run a Grand Prix in Great Britain. The organisation has invested £50m over the last 10 years to develop Silverstone. Today, the British Grand Prix attracts over 350,000 spectators and draws a TV audience of over 400 million people.
However, as has been widely reported, the BRDC’s current contract to host the British Grand Prix – agreed in 2009 with the previous owners of Formula 1 – requires the organisation to pay a Promoter’s Fee to Liberty Media in order to host the British Grand Prix.
This Promoter’s Fee increases by 5% every year. This means that over the first eight years of the contract, the 5% escalator has increased the Fee from £11.5m ($14.7m) in 2010 to £16.2m ($20.8m) in 2017.
The organisation remains in discussions with Liberty Media about finding a solution that secures the long-term financial viability of the event and hopes that an agreement can be reached.
Grant continued: “We’ve been in ongoing discussions with Liberty’s new F1 team about how the situation could be resolved – putting forward a number of proposals that we believe could secure the long-term, financial viability of the event.
Although we have now activated the break clause, we have made it clear that we are open to working with our friends at Liberty to find a solution that works for all parties. Our hope is that an agreement can still be reached so that we can ensure a sustainable and financially viable future for the British Grand Prix at Silverstone for many years to come.”