20 August 2020

Notebook from the Eje Pirenaico

When you go to Barcelona using the same route each time, lovely though it may be, you tend to get to a point where you say: “Let’s try something different” and this happened to me as I pondered my return trip from the Circuit de Catalunya. If you are staying to the north of the circuit, as opposed to down in the valley around Granollers, on a map it seems easy enough to head north to Vic and Ripoll. There are a few wiggly bits after that to get you to the French border at Puigcerdà, but on the French side the roads seem easier and soon you are at Tarascon and can get on the motorways to Toulouse, Montauban, Cahors, Brive-la-Gaillarde, Limoges and Chateauroux, after which you hook up with the normal route at Vierzon.

 

The wiggly bits take longer, obviously, but it seemed like a good idea. Setting off early in the morning, before the Catalans were really stirring (they start eating dinner at 9pm and so everything is offset by that) and headed up towards Vic. The guidance system in the car said it would take four hours to get to Tarascon but these things are often overly-cautious and so I didn’t pay it much attention. At Ripoll I joined the N-260, a road known as the Eje Pirenaico, which were the wiggly bits up to Puigcerdà, climbing up to 5,900ft at the Collada de Tosas, where the road goes through a gap between the various mountains. It is very much an old school rallying kind of road, with the trip enlivened by mad bikers, masochists on bicycles, cows and horses and coaches and various combinations of the above, with even an occasional truck that is presumably delivering cows hit on the road to gluehouses far below. It was beautiful morning and an enetratining drive but the guidance system was not wrong. It took forever. I stopped for a splash-and-dash at Puigcerdà but was only aware of having crossed the border when the road signs began to look French.

 

Still, it gave me time to consider the weekend in Barcelona and the way things are in Formula 1 these days. When you watch the races on the TV the only thing you might notice is that there is no crowd but otherwise everything is pretty much as normal. This is a real tribute to the work that has been done by the Formula 1 group and by the FIA, although on the ground things are very different. The F1 paddock is stripped down to the minimum and so can move faster than used to be the case with far fewer trucks rolling between the races. It used to be in the region of 350 such vehicles. Today it is probably less than 100. This is largely due to the fact that the motorhomes are gone. This agility means that the sport is in the process of completing three triple-headers in 11 weeks, as it tries to catch up and create a meaningful championship. One can go down the route used by Formula E of running six of its 11 events at the same venue over a nine day period. Needs must, I suppose.

 

Doing nine races at seven venues in 11 weeks has been seriously hard work for the teams and while there has been some rotation of staff, the majority of the people have been the same. However this frequency of races is unprecedented in Formula 1 history. This is very useful for the folk at Formula 1 because it creates an idea of what is possible in the future, as will the two-day meeting that is being planned at Imola later in the year. Once something has been done once in F1 and shown to be possible, the tendency in the past has been to adopt new ideas as the new normal. Thus, in the future, there is a strong argument - that you can be quite sure that Formula 1 will be using – that Formula 1 can move more quickly than was previously possible (and reduce costs) by not having all the vast motorhomes of yesteryear and, at the same time, increase revenues by fitting in more races. It’s a slam dunk as arguments go, particularly in these times of economic uncertainty. And so, in the future, we can imagine that there will be more triple-headers (and thus more races), as long as the teams remain fit and agile and do not weigh themselves down with their mobile palaces. The next step in this thought process will be the construction of better facilities at permanent race tracks so that F1 can arrive, plug everything in, put up their own decoration if they so desire (as they do with the garages) and go into operation. If Formula 1 is smart – and the evidence suggests that this might be the case – these units will then be rented to the teams (and to other series) in order to pay for the investment required. F1 could do this itself, could leave it to the race promoters, or could even bring in third parties who could build the necessary and run them as a business. If the charges involved are sensible they will mean that even the rich teams will eventually figure out that it is cheaper and better to use these facilities, rather than trying to run a fleet of trucks and build your own palaces each weekend. The F1 motorhome concept was really an arms race which dates back to the 1990s when everyone’s motorhome had to be bigger and better than everyone else’s. Ye, they were nice to have but the costs were insane and, as F1 proves with the fly-away races, they can easily operate in makeshift facilities…

 

All this makes perfect logic, of course, but in order for it to become the norm, we need to have such facilities built into existing pit buildings across the Continents. It won’t work in Monaco, but if one looks at what they do in Baku or Singapore, it is clear that things can be done fairly easily and without vast cost.

 

The only other problem is to get through the pandemic and find the required 25 races that will boost F1 revenues. It is increasingly clear that to believe that the virus will finish at the end of this calendar year is not a very sensible approach. The only real comparison we have is the so-called Spanish flu, 100 years ago, which began in February 1918 and continued until the spring of 1920 – around two years in all. This infected around 500 million at the time and came in four distinct waves. The current pandemic has (officially) only been detected in 22 million people and has caused less than 800,000 deaths. The real numbers are probably higher, but it is still not to the same scale as 100 years ago. One hopes that this is the result of better medicine and that there is not worse to come but what it means is that F1 is probably going to have to operate in a very restricted way for at least another season, which means that getting to a full 25-race calendar will not be happening any time soon. Races need people to pay the bills, except in the cases where the government simply pays the bills, which is the case in some places – but not many. Going to races and not collecting the same kind of race fees is a big problem for F1’s cash-flow and it means that the sport is not going to generate the big profits that were planned when Liberty Media invested in the sport. When all is said and done, this shows that despite all the blather about TV rights fees and sponsorships, the sport still relies on old-fashioned “bums on seats” to a large extent and as long as the bums are not on the seats then the profit margins are smaller – and the teams need to learn to operate with less. And while there are a one or two teams which are creaking at the moment, the real squeeze is going to come over the winter when teams are facing the costs of building new cars for 2022, potentially more races and revenues that are significantly down. They will be getting a bigger share of the revenues but if the overall figure is smaller, so the percentage is going to be smaller as well. There are three ways to deal with this: the first is to slim down the organisation and risk being less competitive; the second is to borrow money; and the third is to do nothing and run out of money if the revenues don’t bump up again.

With the new Concorde Agreement, teams now have more of a value but those with heavy debts are unlikely to be attractive to buyers. Some of them may be impossible to sell, in which case we will see the same sort of scenario as happened with Sauber where the creditors took over the assets and struggled on. This process has been helped by the fact that there was an Alfa Romeo title sponsorship on offer but that is unlikely to last forever because it is hard to see what the F1 programme has given to the Italian car brand in the last years. Does finishing at the back of the grid make the brand more sexy? We will have ot see what happens because Alfa Romeo’s parent Fiat Chrysler Automobiles is in the process of merging with (or being taken over by) France’s Groupe PSA. That transaction will not be completed until next year but then a new company called Stellantis – the name being linked to shiny stars – will lump together an impressive 14 different brands. Volkswagen has 12, Toyota has five, Renault-Nissan has 10, which former giant GM is down to just four. The good news is that the boss of this new empire Carlos Tavares is a man who likes racing cars – and drives them himself – but he is always careful not to let his passion get in the way of his career and so steers clear of motorsport to avoid the accusation that he is waiting money on a personal hobby. Still, with Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS, Fiat, Jeep, Lancia, Maserati, Opel, Peugeot, Ram and Vauxhall he has a lot of names to find niches for – and while tweed-wearing sporting types may see Alfa Romeo as a sexy sporting brands, others simply see Italian rust buckets…

Anyway, in F1 land, the new world ahead is slightly alarming but it is clear that the best response is to try to get everyone to agree to bring down their spending still further. There is a budget cap in place but it probably isn’t enough as yet. The parallel strategy is for F1 to seek out new revenues, which it was doing anyway. But that is not necessarily going to be easy in the post-Covid-19 world because governments will not be able to spend as much on luxuries as once they did.

But, there is still a solid argument that sport is something that unites nations and F1 has fantastic penetration into markets all over the world, and so has a value if on has the money to aim to deliver global messages.

It is interesting to note that the announcement that there is a new Concorde Agreement in place had next to no impact on the F1 share price, which one might have thought would rise after such a significant development. Such is the world right now.

Back down on the ground in F1, there are some interesting trends developing. More and more drivers are abandoning hotel life and settling into life in mobile homes.

 “At European races I always used to stay in hotels,” says Valtteri Bottas, “but for the future I think I’ll keep the motorhome. That’s what I used to do back in karting, so I have some good memories.”

There is no shortage of space for these fancy machinery as parking space is not much required at the moment. I bumped into Nico Rosberg in the car park in Barcelona. He was there to commentate and he was astonished when I mentioned (through my mask) that there were only 16 members of the written media present. That was probably because of the coverage about Covid-19 in Catalonia but to be honest it wasn’t that different from other places we have visited. Still, things are becoming more complex as different nations impose different quarantine requirements on one another. 

 

The Man from The Sun, who attended all the races up until Barcelona, decided a while ago that there should be a Covid Cup for the F1 journalist who does the most races during the

pandemic. He was in the running for it, but we didn’t see him in Spain and, as far as I can see, there are only five people left in the running. Oddly, they are all British – which tends to underline the stereotype of British people being phlegmatic and not excitable in a crisis (although the government in the UK seems to be completely the opposite and has been flailing around for months, looking like a bunch of people with no clue they are doing). Two of the five (myself included) live on the Continent, which makes it a little easier to get about as we don’t have to fly as much. However what this has meant is a lot of driving. When I got back from Spain I reckoned that I had done about 5,300 miles of driving in the last seven weeks. And with Spa and the two Italian races coming up that will go up by at least another 1,700.

 

Still, every cloud has a silver lining and all these travels, with more time on my hands at different destinations means that I have ended up spending far too much time buying things. I came home from Austria with a car full of garden furniture. I returned from the UK laden with plants and fancy plant supports (which I cannot get at home in France) and I returned from Spain with a substantial box hedge plant and some fancy ceramic pots – because they were there – and cheap…

 

I wonder what I will bring home from Italy…

 

Ends

 

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