MOTORSPORT: Money, money, money in F1 and NASCAR

One is from a report on the Bloomberg financial service that said F1 supremo Bernie Ecclestone’s private equity partner CVC Capital Partners has reaped more than US$4 billion on its original outlay of $1 billion in the F1 business in 2006 – and that it expects to make as much as $7 billion.

Another is a report from America on the earnings of NASCAR drivers. Top of that list is Dale Earnhardt Junior, who has won just one race in NASCAR’s premier division, the Sprint Cup, in four years. His fame, and earning power, stems from being the son of the late Dale “The Intimidator” Earnhardt, the only driver to have won as many NASCAR Cups as Richard “The King” Petty and who was killed 12 years ago in the closing stages of the Daytona 500.

Although never a Cup champion, Earnhardt Junior’s earnings last year have been calculated by the renowned Forbes magazine at $25.9 million - $12.9 million from salary and winnings and $13 million in endorsements.

“Earnhardt’s season winnings last year with Hendrick Motorsports were $5.8 million, so if he gets 50 per cent of his winnings that would be $2.9 million with an estimated $10 million base salary,” Sporting News reporter Bob Pockrass noted.

Second on the NASCAR earnings list at $23 million all-up is five-time Cup champion Jimmie Johnson, a teammate of Earnhardt Junior at Hendrick, and third is former regular Australian visitor Tony Stewart at $18.7 million.

The woman who was on pole position at last month’s Daytona 500, Danica Patrick, has annual earnings estimated at $12.9 million, yet she’s only in her full first full Cup season after switching from IndyCar racing.

Those NASCAR numbers got us thinking about the earnings of F1 drivers too. Ferrari’s Fernando Alonso is widely known to be the highest earner in F1, although his two world titles were in the middle of last decade – and with the old Renault team.

French publication Business Book GP last year reported that Alonso was being paid $37.2 million by Ferrari . It made no estimate of the Spaniard’s income from endorsements.

Ferrari denied the $37.2 million. Forbes reckoned Alonso’s earnings were $32 million, including $3 million from endorsements.

Business Book GP had Lewis Hamilton and Jenson Button second to Alonso, on almost $20 million each at McLaren last year. Hamilton is likely to be on more this year with his switch to the Mercedes factory team, although probably still not at Alonso’s level.

Business Book GP estimated Red Bull pair Sebastian Vettel and Mark Webber, Alonso’s Ferrari sidekick Felipe Massa and Mercedes’ Nico Rosberg at $12.4 million last season. Vettel most likely will have had a pay rise, probably substantial, since becoming F1’s youngest triple world champion.

More on those F1 and NASCAR driver earnings later …

A stock market listing of F1 planned for last September was meant to have crystalised the value of the business – what traditionally has been the Bernie Ecclestone empire, and not including the participating teams – at $10 billion. That listing – or float – in Singapore was deferred, but it may still happen as CVC sells out or further reduces its ownership.

It already has reduced its stake from 63.4 per cent to 35.5 per cent as part of pocketing the $4 billion to which Bloomberg alluded.

The teams traditionally receive less than half of the split-up of the annual F1 “cake”, although they are set to do better under the new Concorde Agreement - the deal between Ecclestone and the teams.

The deputy team principal of the middle-ranking Force India team, Robert Fernley, has taken a swipe at the private equity company, concerned at a deal that will make the most successful teams even richer and also over the money it (CVC) is taking out of F1.

“CVC is not interested in developing the sport. It’s interested in making as much money as possible and then selling it,” Fernley told Bloomberg.

“You need to have an investor who gets a good return, but one that also has an interest (in further developing the sport).

“CVC has milked it and anyone investing in it should be looking very closely at what they’re getting.”

Critics of the Grand Prix in Melbourne are looking ever more closely at what the event is costing in race fees to F1, still controlled by Ecclestone and CVC. A report in Melbourne’s Herald Sun this year revealed the annual fee to be more than $30 million a year.

Then there is almost as much going on the staging of the event, much of it because of the cost of the set-up and removal of facilities each year at the temporary Albert Park circuit.

While the race fee and other costs in Melbourne are a big hit on the coffers of Victorian taxpayers, in return for a global live telecast audience of perhaps 30 million viewers and the economic benefit of interstate and international visitors, clearly the likes of CVC, the major teams and the top drivers are the big winners from F1.

Now back to those two lists, and bear in mind that they are not strictly comparable as the F1 figures do not include endorsements.

Formula One driver earnings (Business Book GP estimates for 2012)

Like Vettel, Raikkonen may have had a substantial pay rise from Lotus-Renault after his fabulous 2012 comeback season. Michael Schumacher’s salary in the three years of his comeback with Mercedes was known to be much lower than that in his heyday at Ferrari. Heikki Kovalainen has lost his F1 seat this season. Australia’s Daniel Ricciardo and Frenchman Jean-Eric Vergne were estimated, perhaps over-generously, to be on about $500,000, with only four F1 drivers reckoned to be earning less than them.

NASCAR driver earnings (Forbes estimates)

Ambrose this weekend is racing in the Sprint Cup’s fourth round at Bristol, Tennesee, home to what is billed as the World’s Fastest Half Mile.
Although 16th in the championship in his Richard Petty Motorsports Ford Fusion, Ambrose has had two top-five finishes and two other top 10s in his eight starts at Bristol.

His crew chief Drew Blickensderfer said this week: “It’s the first time we race the Generation 6 cars at a half-mile track. I think our car will be good. I know we can finish in the top 10, top five and win some races.”

The 12 Hours of Sebring sports car race also is being run in the US this weekend for the 61st and last time before the merger next season of the GrandAm and American Le Mans Series.

Australians Ryan Briscoe and David Brabham will be co-driving two Hondas among the 42 entries, while the IndyCar series – featuring Aussie Will Power with Team Penske – begins next week.

A pair of factory Audi R18 e-tron quattros being tuned up for Le Mans in June are the Sebring  favourites, while the radical DeltaWing that ran at Le Mans last year with a Nissan motor will compete now with a Mazda-based 2-litre Elan engine.

A coupe version of the DeltaWing, with a Don Panoz-owned Elan Motorsports Technologies chassis, will race in the ALMS from the third round in May.

Mercedes entrant Erebus Motorsport had a special test day at Melbourne’s Calder Park early in the week and is hopeful of overcoming the problems it had with its fly-by-wire throttle system and cabin footwell overheating at Adelaide’s Clipsal 500 a fortnight ago.

Jamie Whincup has reached an out-of-court settlement with former personal sponsor Monster Energy.

The four-time V8 Supercar champion had extended his Monster deal for three years last March but it then clashed with rival energy drink brand Red Bull, which Roland Dane’s Triple Eight Race Engineering signed later last year to replace Vodafone as the team’s major backer.

Both Dick Johnson Racing Ford Falcons, driven by Jonny Reid and Tim Blanchard, are running at the GP in Wilson Security livery. Blanchard’s car was adorned with signage of ADVAM, another company in which Wilson Security chief executive John McMellan is involved, at the Clipsal.

DJR, which appeared close to collapse during the off-season after the loss of several sponsors and a pull-out by investor Maurie Pickering, is seeking to extend its sponsorship arrangements with Wilson or ADVAM or both – or a new backer or backers. The existing deals, which since they were announced almost on the eve of the championship have been revealed to be only short-term, expire at the GP.

Steve Johnson, out of a seat this year after making way for pay drivers Blanchard and Reid, said the GP weekend “is very important from the racing and corporate aspect” for DJR. That’s an understatement.

Photos from the Australian F1 Grand Prix at motoring.com.au

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