MOTORSPORT: Red faces on the Gold Coast

A political storm in Queensland this week and some very red faces on the Gold Coast, claimed these days to have become "the home of Australian motorsport", over the collapse of the naming rights sponsorship for the SuperGP event that was previously Indy.

The SuperGP organisers have had the embarrassment of having to tell the Queensland government, which tips $11.6 million a year into the Gold Coast street race carnival, that energy drink Nitro has defaulted on sponsorship payments and has been ditched little more than two months out from the October 22-25 event which is to feature the double act of the A1 GP open-wheelers and V8 Supercars.

International Management Group, a partner (with the Queensland government) in the Gold Coast Motor Events Company that brought in Nitro, now has the task of finding a replacement naming rights sponsor.

But SuperGP boss -- and IMG vice-president -- Greg Hooton is quoted in the Gold Coast Bulletin today saying he "won't lose any sleep" if there is no replacement sponsor.

A curious statement that, on top of the admission that the lost sponsorship was "minor" and "only a small amount" that will have little or even no effect on the event's financial picture when Nitro supposedly beat several other parties to the deal.

And less than two weeks ago Hooton had said: "We have had a payment plan in place which they (Nitro) have met.''

Another embarrassment in the same part of the country is V8 Supercar team IntaRacing folding, leaving Marcus Marshall out of a drive for this weekend's round at Ipswich's Queensland Raceway.

The team, owned by debt-laden IT tycoon Daniel Tzvetkoff and partner Sam Sciacca, surrendered its $1.5 million licence to V8 Supercars Australia and its assets are to be sold off.

Tzvetkoff's Access Cash company -- a subsidiary of Intabill, which is linked to BT Projects, a company in liquidation owing $61 million -- pulled out of sponsoring the team soon after it began, creating massive pressure for it to survive.

Marshall says the team owes at least $2 million. His official statement is here while Auto Action magazine and today's Gold Coast Bulletin have fuller accounts of the team's collapse.

And entries have closed for the revived Rally Australia in NSW's Tweed and Kyogle shires on September 3-6 without Australia's ex-World Rally Championship star Chris Atkinson's name down to drive a Neal Bates Super 2000 Toyota as organisers had hoped.

However, there is some brighter news in the world of motorsport.

The Financial Times in London reported this week that WRC chief Neil Duncanson is claiming that Fiat and Volkswagen may join Ford and Citroen in that series, which this year lost Subaru and Suzuki.

Renault has been given the green light to race in Formula One at this weekend's European Grand Prix in Valencia, Spain, after its suspension over Fernando Alonso's runaway wheel at the Hungarian GP was converted to a $50,000 fine. A 23-year-old Frenchman, Romain Grosjean, winner of two GP2 races this year, will be Alonso's new teammate, in place of sacked Nelson Piquet Junior.     

And BMW, which is quitting F1 at the end of this season, may ramp up its touring car racing activity, with signs it is interested in tackling Audi and Mercedes in the DTM -- the German Touring Car Championship.

And, something quirky and playing on the passions in V8 Supercar racing, fans angry at Team Vodafone/Triple Eight Race Engineering's switch to Holden next season will be offered Ford, Ford Performance Racing and Stone Brothers Racing caps for $10 at Queensland Raceway this weekend if they trade in their Team Vodafone cap.

Now back to the SuperGP sponsorship fiasco, which comes on top of A1 GP's already well-documented problems, it being six months overdue on a "major announcement" on its future that was supposed to be in the wind, and still having only two rounds finalised for its upcoming fifth season.

Attempts have clearly been made to delete the March 18 announcement of the Nitro sponsorship of the SuperGP event, but it can still be found here.

This was going to be a three-year deal, and according to various reports was either for $1 million in its first year or that amount over three years.

Either way, the organisers are now portraying the money as being insignificant in the event's overall financial picture.

How can a naming rights sponsorship be insignificant? If it is, why was the deal ever signed?

Yesterday's official announcement that the Nitro deal is over, in a letter from race boss Hooton to Queensland sports minister Phil Reeves, is here.

Questions have got to be asked -- and answered -- about how this has all come about, especially in light of the Gold Coast's claimed pre-eminent place in Australian motorsport these days -- see the start of the fourth paragraph at this link -- and the supposed competition for the naming rights of the SuperGP.

Instead, the organisers of something that is not looking very special at all at the minute are rushing to remove any reference to Nitro in marketing, advertising and promotional material.

Nitro's motto is "Go Hard or Go Home", but the naming rights sponsor has been sent home early for not meeting its financial obligations.

The Gold Coast Bulletin had an inkling all was not well almost a couple of weeks ago, reporting on August 8 that there was "an ownership dispute between Brooks Capital, directed by former Olympic swimmer Neil Brooks, and fellow Gold Coaster Matthew Nielsen and silent partner, David McSeveney".

"Nitro came out of nowhere in March to beat six short-listed companies to become naming rights sponsor of the Gold Coast's first SuperGP event," the Bulletin said.

"The announcement was met by astonishment, even by those closely associated with the event, to the point some now admit they were not surprised to hear of the troubles.

"Mr Hooton said Nitro was chosen because the product was suitable to the demographic of the motorsport and there were ‘no warning bells' to indicate the company would run into trouble.

"Gold Coast Motor Events chairman Terry Mackenroth defended the decision to choose an untested company, saying the global financial crisis had swallowed up even those with decades of experience.

"Mr Mackenroth said he was disappointed at the outcome."

Mackenroth, a former Queensland deputy premier already embroiled in a huge controversy over lobbying in the state, is quoted by the paper saying: "It (the Nitro sponsorship situation) just exploded in the last couple of weeks. It could never have been foreseen."

How come then that this author, and clearly -- according to the Bulletin -- others, was/were hearing warning signals even on the day of the March announcement?

At the March 18 function Mackenroth said: "We've had some great international naming rights sponsors in the past, but it's great to have a Gold Coast company."

Sports minister Reeves told the Queensland Parliament yesterday all due diligence had been done.

"At the time of accepting Nitro as the naming rights sponsor of the event there was no evidence in the company and financial background searches undertaken that indicated Nitro would have difficulty in meeting their full financial commitments to the event," Reeves said.

This reiterated Reeves' August 7 statement to the Bulletin that "the responsible agency, IMG, undertook a due diligence process, including a company search before the board of Gold Coast Motor Events Company awarded the naming rights".

Queensland premier Anna Bligh said yesterday that the organisers (meaning IMG), having chosen the sponsor, and not the state's taxpayers, would have to bear the cost of the lost Nitro sponsorship.

"This company (Nitro), like many others in the wake of the global financial crisis, is unable to meet its obligations and I think that's a great pity," Bligh said.

Anna, this sounds to us like something a lot different to a well-run business becoming a victim of the global financial crisis.

Queensland Opposition sport spokesman Jack Dempsey said the government was presiding over a "wreck".

After Reeves had assured Parliament 12 days earlier that due diligence checks on Nitro had been done "now he has told us that the sponsorship deal has crashed and burned before even getting to the starting grid," Dempsey said.

"First they lost the Champ Cars [author's note: at the final Indy last year they were IndyCars] and now the minister is trying to tell Queensland motor sport fans and Gold Coast residents that losing a naming rights sponsor is no big deal."

State Opposition Leader and Surfers Paradise MP John-Paul Langbroek has accused the Bligh government of "poor judgment".

Alan Jones, Australia's 1980 -- and last -- F1 world champion who heads Australia's A1 GP team, has tried to make light of all the fuss, telling the Bulletin it would make no difference to race fans if Humpty Dumpty was on the promotional material.

True enough in the case of race fans, but there are serious management issues raised by this sorry episode.

And, while some who would like the Gold Coast carnival to have V8 Supercars as the single main act and forget about international open-wheelers might have a giggle at the demise of the Nitro deal, it ought to be remembered that someone central to the V8 Supercar scene had a hand in a somewhat similar episode 12 years back when an Indy naming rights sponsor went bust before the race.

The Bulletin recently reminded us of that property development company, Sunbelt, as well as a couple of other Indy sponsors that went bad -- Daikyo and FAI.

So the Nitro fiasco is something of a case of history repeating itself in "the home of Australian motorsport".

Image: Terry Mackenroth and Nitro's Matt Nielsen - nitroenergydrink.com.au

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