Meanwhile at the Nurburgring

Things have not been going well at the Nürburgring in recent years. The circuit shares the German GP with Hockenheim these days, but in an effort to generate more revenues from the venue the Rheinland-Pfalz regional government a few years ago agreed to provide huge subsidies to help Nürburgring GmbH to build a vast leisure park beside the circuit. The company promised to match the government investment with private money. It failed to do this and the government had to invest more money to get the project completed. Then estimates for the number of visitor proved to be wildly inaccurate and eventually the Rheinland-Pfalz’s finance minister Ingolf Deubel had to resign. In the middle of 2010 the government decided to rid itself of the problem and handed over the entire business (including the debts) to a new company called Nürburgring Automotive GmbH (NAG), which took over the running of the circuit, the hotels, restaurants, holiday homes, theme park, shops, convention centres and arenas on a lease that runs until 2040. The new company was run by the same people who had previously been managing the Ring, which was not a promising start. In an effort to increase revenues the new company raised prices of activities run at the circuit in the hope that these will keep the business going. This meant that the project ended up creating the opposite effect than intended with the circuit funding the park, rather than the park helping to keep the Nürburgring financially healthy.

The latest twist in the story is that the Rheinland-Pfalz’s Minister of the Interior, Sport and Infrastructure Roger Lewentz has announced that the lease is being terminated.

“The Nürburgring is a showcase for the Rheinland-Pfalz and of paramount importance for the region and its people,” he said. “That’s why ​​the state government invested in the Nurburgring 2009 project, and that’s the basic idea that guides the current provincial government in its decisions.”

Lewentz said that the lease fees have not been paid.

“I have therefore proposed to the Cabinet to ask that the lease agreement with the Nurburgring Automotive GmbH as well as all other relevant agreements, particularly the concession contract for the organization of Formula 1 racing events at the Nurburgring, to be terminated immediately.”

NAS says it will take legal action to protect its position, while the Rheinland-Pfalz government says it will try to find a new operator for the facility.

The circuit authorities say that they had negotiated a deal with the Formula One group to host a race every two years for just €9.8 million ($13 million), which spread across two financial years meant an annual investment in F1 of only $6.5 million. Without the F1 deal the Nürburgring would likely sink further into financial trouble as the race generates not only spectators, but also visitors throughout the year.

12 thoughts on “Meanwhile at the Nurburgring

  1. I visited the ring last year after the spa1000km race, it was a total ghost town, l cant imagine them ever making money, with only a handfull of busy racedays a year

  2. I’d agree with most of your assessment of the situation, save the last half sentence. The Nürburgring is used year round for sporting and leisure activities, it’s renowned around the world and has a reputation as one of the, if not THE world’s premier track. If there is any track in the world that doesn’t need a Grand Prix to publicise itself, it’s the Nürburgring.

    We’ll see what happens, I wouldn’t put it past PM Kurt Beck to shovel still more money into the project, maybe even continue the public subsidies for the Grand Prix against the express wishes of his coalition partner.

    But his reign is coming to an end, and his successor(s) face the nearly impossible task of aligning revenue with expenditures by 2020, from a current shortfall of 2 Billion Euros on revenue of 11.5 Billion. What do you think the chances are of supporting a Grand Prix with public money when you’re cutting essential services left and right? How is the electorate going to respond to that?

  3. Someone should start a movement to get The Nürburgring world heritage status. Along with Spa, Le Mans and Bathurst.

    The 4 Natural Wonders of the Motorsport World. 🙂

  4. In general correct Joe, but NAG did not take on any debts, in fact it’s a GmbH (Ltd) with 75k Euro. NAG (Jörg Linder / Kai Richter) have been involved in many parts now forming this leisure park and Kai Richter has been celebrated by Ingolf Deubel as the magic private investor in the beginning.

    Today governmental audit presented their 2011 report and it turns out that the minimal rental fee of 15 Mio / year was not enough to pay interst and debts. The correct figure is rather 24,5 Mio Euro / year. Which is a problem now, as NAG is not leaving and not paying either.

    I’m a a huge fan of historic Nordschleife and have been grown up there. That’s why I’m running http://www.20832.com and more recently http://www.savethering.org. (Mike)

  5. Remembering a BBC Top Gear programme which showed the remarkable Sabine Schmid in a white diesel Transit van trying to make good her jibe that she could beat Clarkson’s time in the S type Jag, “in a van”, also that anyone could go and drive the track, this also applies to the GP track. I had a look here http://www.nurburgring.org.uk/ and found some interesting stuff which would suggest that there are many visitors all year round to the Nordschliefe, adjacent to the GP track, but no mention of a leisure park.
    There was a petition to separate the Nordschliefe from the rest of the outfit since it seems that the well used old circuit is very popular and used by parts of the motor industry for testing, though their fees have apparently been increased fivefold . The leisure park apparently has no Ring or racing connection apart from using the Ring name.

  6. As a regular Nordschliefe visitor in the past I, like many, have been driven away by the apparent arrogance, lack of affordable opportunity and massive inflation imposed by the current management. Thus the local hotels, bars, fuel stations, supermarkets etc now no longer get any business from me. I have no interest at all in theme parcs and all of the other rubbish that has sprouted up, and neither it seems has anyone else! Let us hope that a new management focus on the key business which is surely motorsport.

  7. It’s time for Bernie and FOM to allow the circuits a fair crack of making a healthy profit out of their F1 races. I’ll leave it there.

  8. My daughter sent me this, the ring in the snow!

    Also apologies to Sabine, her surname is Schmitz and not as I spelt it. Apparently she may be the current UK Stig. There are many videos of her famous Ring Taxi

    As Mike writes above, it looks like politicians have screwed up the Ring’s chance of commercial success. If Bernie bought the whole caboodle and waived his race fee then it could perhaps flourish again.Still no web hits on the pleasure park does it really exist??

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