Formula E hoping for London return despite Royal Parks resistance
By Florence Lloyd-Hughes at the Saatchi Gallery in London
Formula E, the electric motor racing series, wants to stage races in London again even though the current plans are opposed by Royal Parks, the organisation that manages eight parks in the centre of the UK capital.
Speaking in London today at the unveiling of Formula E’s first title sponsor ABB, the Swiss industrial technology company, Alejandro Agag, the chief executive and founder of the series, said he hopes it can still get the backing of Royal Parks.
Although it is based in London, there is no longer a UK race after the event in Battersea Park in the south of the capital was dropped for the 2016-17 season in the face of an application for a judicial review.
Formula E has set its sights on staging an annual event in the centre of London around the Mall, which is home to Buckingham Palace and is the site of the finish of the annual London Marathon.
Agag revealed today that the plans have the support of all the relevant London bodies with the exception of one.
He said: “I don't have any good news on that [a London race]. We have been discussing with the mayor of London, Sadiq Khan, who is very supportive, as well as Transport for London and a lot of the services of the city. We had a great experience with them at Battersea Park but the place we want to race it belongs to Royal Parks, and sadly Royal Parks are not so keen on that location.”
“I hope to give you good news at another point.”
In response to Formula E’s position, Royal Parks told Sportcal: “Formula E is not consistent with our Major Events Strategy. As such, we have written to the organisers of Formula E informing them that the Royal Parks are not appropriate locations for this event.”
Formula E’s lucrative nine-figure deal with ABB, which is taking effect immediately, marks the first time that an FIA-sanctioned single-seater series has a title sponsor.
Through the agreement, ABB is to have naming rights until at least 2025, and is to help Formula E develop technology to improve the quality and performance of its cars.
Agag joked today that ABB could be the series’ only title sponsor if the pair can collaborate successfully, while Ulrich Spiesshofer, chief executive of ABB, made it clear that ABB’s intentions were not just about increasing the awareness of electric mobility, but also "making money."
The bumper deal is crucial for the finances of Formula E, which had previously targeted the 2018-19 season to introduce a title sponsor.
In June last year, it was revealed that the series had posted a net deficit of $38.5 million in the 2015-16 season.
However, this did represent an improvement on the net loss of $68.4 million in its first full year of operation. Sponsorship income amounted to $3.1 million in the first year.
At present, sponsorship and hospitality sales represent the primary source of income for Formula E, and, as free-to-air television coverage is a priority, media revenues lag behind.
Agag reiterated today that Formula E was not following a traditional sports revenue model as sponsorship is its main source of income.
He explained: “The traditional business model of sport would be one third sponsorship, one third TV rights, one third hospitality, whereas our business model is based on sponsorship revenue and team revenue.
“We are effectively in the middle of a strategic choice of where to go with the media rights because there is a lot of money from Amazon and Facebook and they are changing the landscape. So you have to be careful who you marry with.
“Lucky for us we have great partners (sponsors) and every few months we are adding a new partner to our shirts. Our sponsors are looking at the long-term, they're not worried about the short-term, they are looking at what is going to happen with electric mobility."
Formula E’s other sponsors include Julius Baer, the Swiss private banking company, Visa, the credit card firm, Hugo Boss, the German fashion brand, and DHL, the logistics company.
The 2017-18 Formula E season continues this weekend with the Marrakesh ePrix in Morocco.