New F1 Boss Stefano Domenicali Says Miami Not The Only U.S. Market in Play

Stefano Domenicali is distracted. He keeps looking out of his window. He is waiting for someone. He’s still at home in Italy, despite it being five weeks since he took on the role of CEO of Formula 1. The COVID-19 pandemic has thus far meant that he has not been able to move to Britain to work from Formula 1’s offices.

“Sorry, I am just checking because I need to do a PCR (COVID-19) test,” he says. “A person is coming to my house to do it, and I am alone at home, and so I need to let him in.”

f1 grand prix of portugal
Stefano Domenicali

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Domenical, Formula 1’s new chief executive, is good at multi-tasking. You need to be when you run a racing team like Ferrari, or a car company like Lamborghini (his previous two jobs), and even the commercial rights holding company of Formula 1.

As we talk, Domenicali’s mobile phone is pinging with new messages. He is a busy man. But there are things he wants to see in the future and better interaction with the media is important. Thus, he is talking exclusively this day to Autoweek.

The Formula 1 season is due to kick off in six weeks and the world is still being disrupted by the pandemic. Can things really go ahead as planned?

F1 HOPES TO DELIVER ‘NORMAL’ 2021

“I think it is realistic,” Domenicali says, “even if, to be honest, it is challenging. We need to be fluid in our approach, but we are in contact with all the race organizers and they are totally committed to holding the races. Of course, we cannot control everything, but we can control our side, the protocols that we want to respect, the ones we had the privilege of using last year.

Is a Full Season Even Possible?

“This is the credibility we are bringing this year. Last year, there were not so much limitation going from country to country. This year is more complex, and things are evolving every day. But it is our wish and our hope that we can deliver what we want to achieve. We must be strong and we must expect a lot from the race organizers, creating events at the beginning with no spectators or with limited crowd capacity.

“We should not forget that. It is an incredible effort that they are putting in and we need not to forget that. This is a great signal for how strong the link is between countries, organizers and Formula 1 is. It would be easy in this kind of force majeure situation to say: ‘Forget it. We cannot do it.’ But that Is not the case.”

LOOKING AT THE FINANCIALS

In a couple of weeks, Formula 1 will announce its financial results for 2020. It won’t be pretty. The sport may have succeeded in holding 17 races, a calendar that was rather different from the planned 22 events, but the money earned, particularly from the race fees will likely be greatly reduced in comparison to 2019. Race fees make up 38 percent of the sport’s revenues, about the race as TV rights fees.

“I can’t say anything, because we are a stock market company,” Domenicali says, “but what I can say is that there is the will to do the full calendar and that gives us the direction which we are heading in after a very difficult year in that respect.”

It leads to the question of whether the F1 business model is too dependent on the race fees? Would it not be better to relax them a little, allowing the sport to go where it wants to go, from a strategic point of view, rather than having to go to places where the money is good but F1 has limited room to develop its audience.

“Race fees are a significant portion of the revenues of Formula 1,” he says. “This is pretty clear. If you are doing a great job that revenue stream could be higher if there could be more attention from the fans, because then we can also work on competition (with other promoters). I think that the real question is how much will we be able to capture the interest of people by creating incredible, unique occasions and events. From one side, on the racing platform and on the other side by creating a sort of extra environment to which everyone is going because they see music shows, festivals, exhibitions and activation that we need to generate with our platform.”

Courtesy of Auto Week/JOE SAWARD

 

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