What’s Behind The F1 Failure in India?

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As an F1 fan, one would be naive to not understand that there are a great deal of politics that are behind running Formula One racing as a world wide sport.  Perhaps as a new fan, or a fan that doesn’t look beyond the race itself or simply the results at the end of the day, F1 must function in the manner of a well oiled machine, and the intricacy of a Rolex watch. But there is so much more to it than even that.

The politics of F1 come to a head this week as teams descend on the Buddh circuit in India for this installment of the championship. With the last race in Korea so poorly attended and most likely a financial loss for FIA, the sanctioning organization behind Formula One racing, a second straight money loser is not going to tolerated for the 2014 campaign. For all intents and purposes, this is the last Indian Grand Prix we might see in a while, despite contractual obligations to return in 2014.

Both sides of the argument make their points in press releases and interviews, with the fans left forming opinions of their own while gleaning from these reports; some official and some leaked. Shilpa Kannan, of the BBC News, Delhi, authored an article that revealed some of the more important behind the scenes issues complicating the GP in India. 

Money. It all comes down to the money – how much is there to be earned, and how does it get spread around. Like all professional sports, F1 is also a business. If the business model does not make money, it has to correct how it does business, or face failure. Part of the problem is, that India does not recognize Formula 1 Racing as a sport. They still classify it as “entertainment” as if it were pro-wrestling or something, causing massive taxes to kick in that effect everyone from FIA, to the teams, drivers, and yes, even the fans who are forced to pay an entertainment tax on their tickets that they would not have to pay to go see an soccer game.

McLaren pilot Sergio Perez accepts that motor racing hasnot yet captured the hearts and minds of the Indian people. Perez “I think Formula 1 is not very popular here. But the interest is growing among the media and the fans. India is a very big market for Formula 1 and we should definitely be aiming to come back.”says it is a shame that the Grand Prix is not happening in India next year.” He added that it is a shame that F1 will not be back in 2014.

With the Indian economy in a slump as America’s economy slumps and fewer jobs are outsourced to India or computerized, the Rupee has dropped 40% against the dollar since last year. Taking that into account that the privately operated Buddh Circuit must pay a $40M licensing fee to FIA each season to keep the race on the calendar, it all starts to add up to less revenue for everyone involved.

Fan following while on a slight incline is still smaller than at other extra-European GP’s, and their money is worth less, driving up prices for tickets, souvenirs and other incidentals that fans would normally spend money on when attending such a grand event (dinners. hotel rooms, travel expenses etc.)

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Another issue laying squarely at the feet of the Indian government, is ease of travel in and out of India for media representatives and others who wish to come to India for this event and can’t. Why? Because the Indian government is apparently unable or unwilling to get the work needed to provide supporting visas for these people to get permission to travel into India.  Indian Formula 1 driver Karun Chandhok reports “Just this week, I have had at least 50 different media people from around the world, and people from teams, engineers who have called me to say, ‘Hey, we are stuck in London without a visa, we can’t come to the race… When you have 700 world media coming to talk about your country and about your race – the only thing they are going to go back with is what a pain it was to get into your country.”

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F1 driver Karun Chandhok says India should make it easier for overseas visitors to get to the race

Chandhok went on to say that that while he can understand the government not being too involved, but wisely stated:

“It’ll be good if they didn’t hinder the process.”

This interview, now making the social media circuits gives us a bit of insight. If this is any indication of the seriousness of the F1 fans or media in India, they do have a long way to go.

Rising cost, governmental indifference if not opposition, and an uninspired fan base do not work together to build a quality reason to return in 2014. Driver Chandhok points out that F1 is good for India.  “It is a global calling card”, he says, “one that can open doors for Indian companies looking to gain an international foothold or for global companies entering the Indian market. If we really want to help brand India, we need events like F1.”

 

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