Racehorces are the traditional plaything for moneyed royals in the Middle East, but Sheikh Maktoum Hasher Maktoum al-Maktoum, the nephew of the crown prince of Dubai, prefers burning rubber. He plans to launch a rival to formula one (F1) grand prix racing.
A number of attempts to create a winter alternative to F1 have foun-dered in recent years. Despite well-documented problems, F1 retains a monolithic status for sponsors in terms of global reach, glamour and exposure.
But Sheikh Maktoum insists he has a serious business venture. Recently in London, he unveiled the first six teams that will compete in the A1 championship. The organisers have promised at least 26 teams racing in 10 to 14 exotic locations.
The cars won’t be as fast as F1 but will all be identical, with the emphasis on driving ability and plenty of overtaking. Its backers hope to re-inject some of the excitement that has been lacking from F1 recently.
The business model is different too. In each country, backers will sign a three-year franchise contract to run their nation’s team. In theory, the franchise holders will find willing sponsors keen to expand into new markets at cheaper rates than F1 and keep most of that revenue.
A1 grand prix will organise the cars, the circuits and the travelling circus that surrounds any big motor racing event. It will take an annual fee from the teams and keep the bulk of television revenue.
BSkyB, the United Kingdom pay-TV company, has agreed to screen the races, qualifying and practice sessions. Sky Sports chief Vic Wakeling said: “We have been sold on the concept of a genuine test of driving skills … and we are delighted to be involved from the beginning.”
Sports marketing experts point out that the financial problems hobbling some F1 teams might yet blow a hole in A1 grand prix’s balance sheet.
For Sky it’s a low-stakes gamble. For Sheikh Maktoum, the risks are higher. He and his investors — including South African entrepreneurs Brian Menell and Antonio Teixeira —are believed to have paid $80-million to get the idea off the ground, and prize money will cost $72-million over the first three seasons. But, to put the outlay in perspective, the sheikh’s uncle is valued at $10-billion.
The sheikh says A1 grand prix will be profitable within three years, taking motor racing to parts of the world that F1 can’t reach. There is, he believes, untapped potential in countries such as Dubai, Qatar, Bahrain, China and India. — Â