Wealth Blog | China turns off Formula One

Whoever ultimately succeeds Bernie Ecclestone in Formula One is going to have his work cut out.

Figures released last week in the annual “F1 Global Media Report”, published by the sports commercial rights holders, showed the global television audience in 2013 dropped by 10 per cent, with 50 million viewers choosing to switch off. Significantly, the biggest drop was in China where just 19 million viewers tuned in, a drop of 30 million compared to 2012. The close to US$ 200 million per year it takes to field a top two car team is largely funded by sponsorship and it is the half a billion global TV audience that persuades many companies to use the sport as a marketing platform, so any drop in viewing is bad news for the sponsor hunters.
 
Empty grandstands

Ecclestone blamed the total domination of the sport by Red Bull’s champion Sebastian Vettel as the reason for the switch off, but in the case of China, the move away from state broadcaster CCTV screening the show and the rights being allocated to a host of regional broadcasters was the cause. There is probably more to it than that, as the empty grandstands at the Shanghai Grand Prix suggest that even with China’s growing love of the motor car, the high octane world of Formula One just hasn’t caught their imagination as much as Ecclestone- and the multinationals who saw Formula One as a marketing tool to help them in the world’s second largest economy- had all hoped.
 

Time for a change

A good CEO can probably turn his hand to running all sorts of different companies, provided he has the right vision and leadership skills. 

One job that looks likely to be filled this year, but probably not with anyone from this part of the world, is that of running Formula One motor racing. Bernie Ecclestone has presided over the sport for four decades and is, at 83, at an age when most people would consider retirement, but he says he has no plans to let go. But add in the fact that he has a trial for bribery looming in Germany, and is awaiting the judgement on another trial held last year in the UK, it’s not surprising that the shareholders, stakeholders and administrators of the sport are thinking about succession. 

Last month, Ecclestone resigned as a director of Formula One Management, the company which runs the sport. Whilst he maintains that he will continue to run the sport and it is "business as usual", even though he isn’t on the board any longer, the past few months have seen plenty of speculation about who might be the successor.