Due to confidentiality undertakings, the folk at Silverstone are not allowed to talk about what is going on in relation to a possible sale of the facility to Jaguar Land Rover. However, I believe negotiations have moved beyond exploratory conversations and while there is still no certainty a deal will be done, there is sufficient interest for the British Racing Drivers’ Club, which owns the track, through its Silverstone Circuits Ltd subsidiary, to host “a forum” for its members on February 24 to discuss the potential of a sale and to explain the implications of such a move. If things develop favourably, it is possible that there would be an Extraordinary General Meeting of the club as early as March 16, to decide whether or not to push ahead with a sale.
The BRDC board of directors used to have a mandate to sell the circuit without needing to consult the membership, but this ran out in the summer of 2013. Any new sale plan must now be approved by the members. In recent times, some have argued that the circuit should not be sold and should remain independent unless there was a significantly good offer, such as a private-equity-backed deal that was discussed, but never completed, in 2014.
Since then there has been new management at Silverstone Circuits Ltd and financial progress has been made. However, there is little doubt that the circuit business is a high-risk enterprise and the BRDC has no cash reserves to fund future development, or to provide financial support if there are problems. The fees required to host Formula 1 races continue to rise each year and the track has a contract until 2026, although there are believed to be break clauses ahead. In some respects, Silverstone is in a strong position because there are no realistic options for a British Grand Prix, despite some carefully-nurtured rumours about alternatives. There has even been the absurd suggestion that the Formula One group has a right to veto any sale of Silverstone. This is clearly not true. The Formula One group could cancel the British Grand Prix contract if there was a new owner that it did not want (or if it felt that it might be able to get a better financial deal), but it is unlikely this would be a wise move, as it is very clear the race makes little financial sense at the moment and the danger is that Silverstone might simply tell the Formula One group to take a hike. That would allow the club time to build up financial reserves, but it could mean the end of the British Grand Prix, at least in the short term. If that happened, the Formula One group would be in for some pretty serious discontent from the F1 teams, although circuit negotiations these days must be viewed against the background of the ongoing power struggle between the group and the big teams. The calendar remains an area over which the Formula One group has control and it can use this as a way to pressure the teams. Ferrari has adopted a robust attitude towards the sport and it is perhaps no coincidence that the Italian GP is in difficulties. The German GP, a race dear to Mercedes, has an uncertain future and the British GP, deemed important by the majority of the teams, might also find itself caught in the crossfire. The circuits have considerable potential power in F1 politics, but do not currently use this because they are too busy fighting one another for events.
If the track is sold to JLR, it would likely be leased back to the BRDC and things would continue much as they do now, except that the new owner would be able to build new facilities on the site and would have more access to the various circuits, for car-testing purposes. It is unlikely that JLR would want to have anything to do with questions about the British Grand Prix, but while this may not appeal to the BRDC, the fact remains that if the club remains the owner of Silverstone, its financial status will continue to be precarious. Most races get financial aid from governments but this is unlikely to happen in Britain because of previous problems, and politicians will not want to be accused of spending public money that serves only to increase the profits of the Formula One group.