NOVEMBER 6, 2001
Keep an eye on Korea
FORMULA 1 teams are constantly in search of new sponsorship and with the world teetering on the edge of a recession, the marketers are delving into new markets which are doing better than the traditional F1 revenue bases. One such target is Korea which has been struggling since the Asian crash three years ago but is now showing signs of renewed growth. Asia's third largest economy has been involved on and off in Formula 1 sponsorship, notably through Korean Air's backing of Benetton.
Growth in Korea has slowed since last year but is still rising steadily and confidence in increasing. Korea is, however, heavily dependent on the US market and so there are fears that this could drag the economy down again.
In an effort to avoid this happening Korean firms are being encouraged to look for export opportunities elsewhere and the government is discussing further deregulation to promote exports and foreign investment. The forthcoming World Cup in 2002 will act as boost to the local economy but on the horizon is a booming China.
This week Supachai Panitchpakdi, the Thai politician who heads the Association of South East Asian Nations trade organization warned that ASEAN members must prepare for competition from China. China's share of the world trade is expected to double within 10 years as in enters the World Trade Organisation.
Korea has already considered F1 as a means of increasing exports and investment. There were plans for a Grand Prix to be held in Korea but these had to abandoned because of the financial crash in 1998. At the time the country's biggest car manufacturer Hyundai was looking seriously at entering F1 and is even rumored to have had a Formula 1 prototype engines on its test beds at the Namyang R&D Center.
In recent years Hyundai has had to satisfy itself with a factory team on the FIA World Rally Championship but is now believed to be looking at a bigger sporting involvement.
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