Bahrain McLaren team expected to lose car backer
The Bahrain McLaren professional cycling team, which competes on the top-tier UCI WorldTour, is preparing to lose car manufacter McLaren as its main sponsor, according to reports.
Cyclingnews.com has reported that the team’s association with McLaren, which began in 2018, and and extended last year when the company became a joint venture partner, is likely to finish at the end of 2020, and that the team is already searching for a new principal partner.
McLaren is reportedly unwilling to extend its financial backing of the Bahrain-owned team at a time when the company’s core automotive business continues to be severely impacted by the coronavirus pandemic.
Cyclingnews has cited a source as saying: “The team are onto something else, but they’ve not found anything concrete.”
The team is majority-owned by the Bahrain royal family, specifically Prince Nasser Bin Hamad Al Khalifa, and reports suggest he has guaranteed to keep it running, with or without McLaren as a fellow backer, until next year.
The source added: “The Prince is still backing things but he’s pretty much the only one keeping the team alive at the moment. McLaren’s focus is on keeping alive their Formula 1 project.”
All staff at Bahrain McLaren, including riders, took pay cuts of up to 70 per cent for three months this year. It is not yet known whether staff will be paid their full salaries for 2020.
McLaren has been having its own financial troubles. Earlier this year, the manufacturer cut 1,200 jobs from its UK headquarters, out of 4,000 total employees, with 70 of those to lose their jobs coming from the Formula 1 operation.
McLaren is also majority-owned by a Bahrain-based company, with Mumtalakat, the Gulf state’s sovereign wealth fund, holding a 56-per-cent stake.
The McLaren Group, comprised of the Automotive, Racing and Applied divisions, reported a pre-tax loss of £133 million ($166 million) in the first quarter of 2020.
Sales of its cars sunk to an all-time low during the shutdown of its factory, while revenues from Formula 1 have also fallen due to fewer races being staged this season.
Last month, it was reported McLaren was considering selling a stake of up to 30 per cent in its Formula 1 motor racing team to raise the necessary funds to guide it through the coronavirus pandemic.
The Group has had to take a loan of £150 million from the National Bank of Bahrain to help with its cashflow issues, despite £291 million being pumped in by shareholders in March.
Mumtalakat also owns part of the NBB.
Bahrain McLaren had originally seen its budget for 2020 increase, enabling it to sign riders such as Great Britain's Mark Cavendish.