Germany. A land of many things. Beautiful countryside. Grands Prix. Court houses…
The news that the Formula One group will waive the race fee for the Getman GP to take place this year is certainly one of interest. There will, inevitably, be suggestions that not demanding the $18 million race fee is an attempt by Bernie to not be beastly to the Germans because he hopes it might have some effect on the courts of Bavaria. Perhaps it is, but if that is the case it is a measure of desperation. From now on, every track with financial problems will be saying “But, Bernie, you did it for the Germans…”
This will impact on the bottom line (or potential bottom line) of CVC Capital Partners, who might perhaps argue that such a move is not in their best interest and thus that their CEO did not do as well as he could have done when the 2013 figures come out. Financiers are financiers.
There are some too who would argue that Bernie needs the German GP for contractual reasons and/or to stay sweet with Mercedes Benz. It is perhaps not nearly as obvious as it might seem. However, look at it another way: what message would have been sent out if he had done the opposite.
Looks to me like Mr E was stuck between a rock and a hard place.
joeblogsf1 
The CVC business model is certainly starting to unwind as both TV revenues and venue fees decline. Final nail in the coffin of the floatation?
Very un-Bernie like, sly dog! Hasn’t being too generous to Germans gotten him into trouble already? Why do I get a feeling he’s about to pull a rabbit out of a hat and beat this thing?
Great opening line. Nice Noel Coward reference, Joe!
It’s also been interesting that in his interview in the rags at the end of last week, he was acknowledging that he may have to go to prison.
It was quite surreal reading the pieces, because he was depicted so out of character.
That is Bernie. There are many sides to this remarkable character.
Has anyone ever done a good profile of him Joe? The character we see on TV comes across as a bit of a Muppet to be honest.
How about putting a few of these Bankers away in the G20 counties that crashed the world economy with their worthless paper, libor transgressions etc? Those monkeys get to ‘skate’ and are getting bonussed to set up the next hose of cards.
Whats locking up an octogenarian going to accomplish, some token prosecution for the public? Reminiscent of the Martha Stewart debacle – selective prosecution of a public figure, yep she was the worst offender on wall street – puh-lease. Not saying Bernie or Martha didn’t break the law, but if your going to prosecute them – root all the top white collar offenders out and run them through the courts too!! Don’t be throwing a bone to a perceived foolish public. Hard not to admire Bernie’s resilience, tough old boy, I hope he laps those German prosecutors (at least they’ll be well fed @ Nurburgring, might slow them down)
I see this as a very good thing myself. It’s no secret that the German Grand Prix is in financial dire straits. The simple fact is the World Championship needs its core countries if it wants to continue being the premier racing series in the world. The World Championship cannot consist of bunch of races like the Grand Prix of Zublikan, all because it has a wealthy prince or dictator who is striving to gain attention. If the entire season was filled up with races like that, the World Championship would be a farce. On the flip side, these countries could never be given the financial break being given to Germany, because simply put, they have to pay for the privilage and prestige to be on the same stage as the core countries, such as Germany, Great Britain, Italy, and Monaco in the World Championship.
$50 million here, $18 million there …
He could’ve bought the Nurburgring. What’s $170 million to a man worth $3.8 billion. Plus he could pay himself the race fee & hide it in some offshore tax shelter.
Maybe this sport needs a slightly different formula? Just shooting from the hip, what if there were a group of “classic” circuits, which would pay a “symbolic” handful of million bucks, with the offset financed by “new” tracks? Sort of like depreciation of the investment made in creating the track in the first place. Let’s put the dividing line at 30 years in business, 1983. This would mean that Montreal, Hockenheim/Nuerburgring, Sao Paulo, Monaco, Monza, and Silverstone would pay the “classics” fee, in some years to be joined by Hungaroring and Suzuka. The longer you care about hosting the event, and keeping up good work, the less you pay to CVS, and the more you have to re-invest to revamp the depreciating asset – your ageing race track…
Monaco already get their race for free. Imagine if someone had the balls to start asking few remaining rich Europeans to pay for their race!
But this is not a surprise, for weeks, ever since Bernie announced that the German GP was back on again, we have been wondering how it was going to be paid for, with the most likely answer being that Bernie was paying. This is a much more cost efficient way for Bernie, since he only looses part (his share via the various FOM pies) and not the whole fee, mind you his fellow shareholders may not be so pleased as they see this business model start to collapse.
If this could in any way be taken as an inducement to the German courts, of course that could bring further charges against him. But then again FOM shareholders may object to what is effectively their money, being used as a bribe.
Are we to be told whether it will be Hockenheim or that basket case Nurburgring, if the latter then it must still be dubious as to it actually taking place.
On a separate issue it was strange that Charlie Whiting was allowed to address the public indirectly. Surely this must hint that he is in the clear over recent tyre related events.
Maybe a deal has already been struck with the German courts?
Maybe he simply had the fans at heart?
Another ‘good story’… germinates?
I believe posters have indicated the German courts don’t plea bargain.
“But, Bernie, you did it for the Germans…” to which he’ll reply “Can you put me in jail? No? Well, then. Pay me!”
He could have paid it himself. Petty cash to him. Obviously he wouldn’t want everyone knowing so he could have handed it over in secret. In a brown envelope, under the table so to speak. Clearly not the sort of transaction Mr E has any prior experience of but I’m sure no one would have noticed or minded? 🙂
Oops! I can’t really think of more naive thing to do. Then again, I don’t understand politics. It does smack a bit of desperation and that can’t be a good thing for F1 worldwide.
Webber – > Porsche !!!!!!
2014 just got interesting!!!
More interesting!
Interesting that it is deemed, for obvious reasons, that Germany could be a special case for this year – but for this year only? It also raises the question of France’s lack of a GP, bearing in mind their importance as an engine supplier. Perhaps a similar deal can be arranged for them……
How are the various contracts such as TV structured? If Germany was off, that would have left a big hole in the calendar and just 18 races. So would a non-race impact the other contracts as well as the total income for CVC? Then, they are trying for 21 or so races next year!
If the number of races drop below an agreed level, then the fee(s) broadcasters pay is subsequently reduced.
So it is important to maintain a minimum number of races.
Is Bernie waiving the fee, or taking over promotion? There’s a big difference in the money, coming in.
Après lui, le déluge?
I don’t get the love nor reverence that Bernie receives. EVERY sport I follow (Soccer, cricket, AFL to name a few) has signed record TV deals over the past few years. F1 is not some special case whereby Bernie magically turns water into wine. There’s a genuine appetite for sport and TV money is readily available. I’d even argue the case that Bernie costs F1 more than he earns it. He treats race venues and fans alike with absolute disdain. He cares little for crowd attendance and F1’s online presence is a joke. Here’s a hint Bernie, sponsors loved packed crowds and so do TV companies. Nothing turns them off faster than a sea of empty grandstands, it’s not a good look.
Here’s another tip, your new engines are about 4 years too late. How can the so called “pinnacle of motorsport” still be using 6 year old v8 engines (and frozen spec ones at that). There was once a time when F1 cars were intimidating beasts sitting on the grid. F1 certainly lost that allure a long time ago.
More akin to being stuck between potential jail time and probation.
Me thinks this may also be the opening salvo of a plea agreement to avoid a long drawn out court fight. If the Germans do that sort of thing? Seems like I may have read (maybe here Joe) that their legal system precludes plea deals?
So is Bernie trying to sour the CVC deal so that he can swoop in a buy it for himself instead of CVC letting it float? It seems he’s done this recently a few times (can’t think of anything directly, but there’s been a few statements he’s made). Or is he looking to start buying tracks when he’s pulled from his job with the CVC?
To me, the obvious attempt to warm up to Germany to keep himself out of jail doesn’t seem “Bernie” enough to me. He’s usually more subtle.
Who speaks for CVC aside from BCE? Certainly one of F1’s most important stakeholders but often referred to as a sort of faceless group of bankers. You must have sources in there….
It it worth remembering that the German GP alternates and this year it runs at the bankrupt Nürburgring. Even Bernie can’t put his hand in a naked man’s pocket, as we say here. So it is a stop gap to keep things afloat while the local government sorts out the mess. Next year’s German GP will be run in Hockenheim again. The main point here is that a world championship without a German GP is unthinkable. Too much money in the long run from the automotive industry and the sponsors to simply cancel the race. Bernie knows that and while he is greedy he is not so dumb to miss the obvious inability to pay this time.
Being Bernie i would be very suprised if he ends up in jail, using his charm, wit and clout and the miriad of lawyers. The courts may settle for a deal or a secret out of court settlment, if that is possible in German Law. Bernie must be very slippery and may be the reason he has survied this game for so long.