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F1: Toto Wolff Admits Hosting Fees are not Sustainable

F1: Toto Wolff Admits Hosting Fees are not Sustainable

Mercedes team boss Toto Wolff believes that the hosting fees of the F1 circuits are not sustainable. He says that Liberty Media needs to look at other avenues to generate income for the sport.

Last year Silverstone activated a break clause to cease hosting the British Grand Prix race after 2019, citing finances as the reason.

However, Silverstone is not the only circuit that is in danger of collapsing. Hockenheim have said that they “cannot continue” with the current conditions of their contract. As it turns out, they are taking huge financial losses each year.

Wolff agrees these deals are not working for the circuits.

Toto Wolff
Toto Wolff

“Sanction fees were one of the three key revenue generators in the old Bernie Formula One business model. And he was exceptional at these deals,” he said.

“I am not sure that is sustainable.

“It is clear that when there is a change of regime, people and promoters will negotiate and try to restructure the business model.

“Bernie was squeezing the last cent out for the benefit of the shareholders and the teams but it left certain promoters in a very difficult economic situation.”

According to the Austrian, it is up to Liberty Media to explore new avenues for generating income for Formula 1.

He added “maybe that one pillar (hosting fees) is going to be difficult to maintain on the levels we have seen before.

“We have to grow in other areas, we have to grow broadcast deals and digital revenue and monetise alternative revenue streams.”

The Bernie Ecclestone model also covered broadcast deals and advertising. Liberty have gone a step further and begun to tap into the digital market with F1 streaming.

After the Monaco GP, the F1 paddock heads across the Atlantic to Montreal for the Canadian Grand Prix. Wolff is a bit worried because last race’s bane, the hypersoft tires are set to be used again.

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