Regardless of the machines – go-karts or Formula 1 cars – races aren’t cheap. Developing the most technologically advanced cars and hiring the best drivers in the world to drive them around the globe is particularly not cheap. According to the Mercedes-AMG annual report shared by Motorsport, it took $ 459 million to ensure that Lewis Hamilton and the Brackley team won their seventh respective world titles.
As astronomical as it may sound, that number actually fell last year thanks to a season shortened by COVID. The team reportedly spent about $ 478 million to get Hamilton and Bottas through the 2019 racing calendar, which consisted of 21 races, compared to just 17 in 2020.
Despite the uncertainty the team has faced over the past 14 months, it was still able to generate a profit of $ 19 million, a slight decrease from $ 21 million in 2019. However, many of the sport’s small teams like Haas and Williams and even giants like McLaren didn’t leave the 2020 season unscathed as most sponsorship deals stalled and other money-making income simply dried up. McLaren was even forced to put its own headquarters up for sale in order to make some cash, with a buyer eventually agreeing to a buy and 20-year leaseback deal in April of that year.
“In 2021, the team will continue to expand its financial sustainability, supported by maximum competitiveness within the framework of the new financial regulations and by diversification and use of the team’s capabilities through the Applied Science department,” said Mercedes F1 boss Toto Wolff in the report. according to motorsport.
“Contingency plans are regularly reviewed to help mitigate the business impact of the virus. As a high-tech company, the team is able to adapt competitively and commercially to changes in its operating environment and will continue to invest in its skills and culture to ensure medium and long-term “long-term success on and off the track,” added Wolff.
One piece of information that stands out from the report is the overall financial impact of the F1 team on Mercedes-Benz as a whole. Wolff goes on to say that the automaker’s value “rose from $ 31.9 billion in 2013 to $ 49.3 billion in 2020, with Formula 1 making an important contribution to the brand’s status as the eighth most valuable in the world performs “.
The racing business is extremely complex and volatility is no stranger to it. As we’ve discussed in detail earlier, cash income can be generated in many ways, from paid drivers, FIA prizes, prizes, sponsorship, partial ownership, TV contracts, and more. As with most business models, the more attention a team can give its supporters, the more it can bill they are most likely very happy with things, but they will likely argue that there is room for improvement.
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