Ecclestone Waives Bahrain Fee Despite Heavy Losses Estimated
By Community | February 24, 2011
Formula One is expected to lose about US$100m in revenues due to cancelling its season-opening Bahrain Grand Prix amid safety fears due to civil unrest in the nation, currently home to violent human rights protests.
Some of the “biggest losers” will be the 12 teams, as it is believed there are penalty clauses in their contracts with sponsors that would be triggered by missing a race.
The biggest-spending race sponsor is Bahrain’s Gulf Air, which pays an estimated $6m for naming rights. That fee comprises around half of the total income from advertisers at the circuit.
Despite heavy losses being estimated, Formula One supremo Bernie Ecclestone has claimed that Bahrain will not have to forfeit its $40m staging fee after calling off the race.
Ecclestone looked to clarify the situation after reports suggested that Bahrain would still have to pay the bill, so to speak, despite not actually staging the event, telling the Daily Telegraph: “The fee that is normally being paid for the event is not being paid.I am not charging them for a race they are not getting.”
Ecclestone continued: “Whether they are covered by their insurers for loss of revenues, ticket sales etc., I am not sure. But if anything is force majeure then that (the political unrest) is. It is similar to if an earthquake had struck – no one could have foreseen that a month ago.”
It is unknown as to whether or not the Bahrain Grand Prix will be rescheduled for later in the calendar with Ecclestone adding: “If and when it is rescheduled they will pay their usual fee. If everything is peaceful, which we hope it will be, then we will try our best to fit it in.”
Another suggestion has been made that would see the postponed Bahrain race allowed to take Abu Dhabi’s place on the schedule. World Motor Sports Council VP Mohammed ben Sulayem said: “Abu Dhabi and Bahrain agreed to have a big separation on the calendar to make the most of the exposure that a grand prix brings. However, this is an emergency and in an emergency we need to work together.”