Features - Interview
MARCH 8, 1998
BY JOE SAWARD
The Grand Prix Ball in Melbourne on the Friday night before the Australian Grand Prix celebrated the 50th anniversary of Bernie Ecclestone's involvement in motor racing.
Bernie's racing career began back in 1949 when he bought a 500cc Cooper racing car and started competing in local events. Today he controls a multi-million pound sport which spans the world. But past achievement is not something on which Bernie likes to dwell.
"I don't look at things like that to be honest. I just do my job," he says. "Lots of people have been 50 years in their jobs. This is what I do. I don't look back and think about it. I have been lucky enough to be in a position where I could do these things. I have been lucky enough to have super support along the way from people like Enzo Ferrari, Colin Chapman and Teddy Mayer. These days it is not necessary but in the early days when you are building something you really need it. They were very supportive. They helped me to start to build the business. Other people today are reaping the benefits of that."
The growth of the sport has made Bernie a public figure, particularly in Britain where he has been the country's biggest taxpayer for the last few years and where he was linked to a political scandal over a donation he made to the Labour Party when it was campaigning to win the 1997 General Election.
"I am not a public figure by design," he explains. "It started when there was a leak about the flotation of the company. That was not my idea."
What about the infamous $1.6m donation to the Labour Party? Does Bernie think he was treated fairly?
"I don't think anyone really understands these things. The answer is no and probably the reason was because it was badly handled by the party. I make money in England, I pay my taxes in England which I don't have to do. I could do it somewhere else. I could live somewhere where people don't pay tax and I could still run the business because I travel and I use a telephone.
"If you make money I think you should be able to do what you wish with it. I don't think you should be dictated to. For years and year people have been making donations to various political parties without any criticism so I think it was very unfair.
"There were a whole bunch of circumstances which made the whole thing happen. Someone close to the party who wasn't in a position to make a donation thought it would be a good idea. I was a bit lukewarm about the idea. And then suddenly this campaign came out from the Conservative Party - Tony Blair with red eyes and I thought that was definitely below the belt. The Conservative Party had an enormous budget to do these things and they wasted the bloody money to be honest."
Had Bernie been supporting the Conservatives?
"Not at all. I had never made any donations to anybody. Anyway I said to this guy "Come on. Let's get on with it". It was not connected with any favors. I didn't know anybody. I met Blair at Silverstone and he seemed an up-together guy, a nice guy. And I told him at the time that as far as I was concerned he could be a Conservative and still be the Prime Minister.
"What happened after that was grossly unfair. It was badly handled by the Labour Party. They should have either said they were not prepared to disclose donations or give details about who had donated what over the last five years if the other party agreed to do the same thing. They were wrongly advised and then they were stupid to go and ask somebody: "Do you think we ought to give the money back?" It was completely crazy. They reacted to the press, which was working on disinformation in the first place."
The suggestion that Bernie was trying to buy favor to get the British government to stop a European ban on tobacco advertising did the image of Grand Prix racing considerable damage. But how does Bernie see the general health of the sport, particularly with regard to the ongoing dispute between the teams and the governing body over the Concorde Agreement?
"We have a Concorde Agreement," says Bernie. "It exists and there is nothing wrong with it. The bottom line is that seven teams have signed for a long period to guarantee that they would be there and if one of them stopped or they did not have enough cars they would make enough cars. It was a commercial arrangement. Some teams did not sign and they were outside. The others were locked in and that is why they got the new money. It is possible that the people who decided not to sign at the time could sue all the others and say that the money should be shared between all of them but we have been advised that they would be unsuccessful."
One of the big problems in discussions over a new Concorde Agreement for all the teams to replace the existing one is the question of the succession when 67-year-old Bernie.
"There is no problem with the succession," Ecclestone argues. "They know what is going to happen. We will float the company. There will be a board of directors. The problem is that they think they would like shares in the company for free. They say they helped build the business and maybe that is true. To be honest I think I may have helped them build their businesses. I have probably invested more money than two or three of the big teams put together. I don't want shares in their business. I am delighted when their businesses run successfully. I am delighted if I see that they have healthy balance sheets. I am the happiest guy in the world because I knew them all when they did not have those things.
"The difference is that I had an aeroplane 30 years ago so it is nothing new to me."
All the arguing over the flotation must have damaged the credibility of F1 in the financial world.
"I don't think it is possible to float the company at the moment with all these big question marks hanging over it," Ecclestone explains. "The European Commission can come out and say the stupid things they say and people who are not in touch and close say: "My God!" The Commission people appear to think that they can do anything they want."
So comments made by the european Competition Commissioner Karel Van miert about F1 have not been fair?
"Quite obviously he hasn't been. If I made those comments about him he could sue me. Unfortunately I cannot sue him. No-one can sue him. When he made a lot of the statements he made it was based on lack of information. A complete lack of information. He forgot all the things that the FIA had said."
So how can the problem be solved and the float go ahead?
"If he was to be able to sit back and say: "Forget all the things I have said" and if all these things were to be put to one side, as would normally happen in a business, I think that probably all the problems could be solved in 20 minutes. But maybe he doesn't want to solve them."
There have been suggestions in the F1 world that the fight with the Commission is related to the fight between the European Commission and F1 over tobacco.
"If it is that is completely out of order. That is definitely an abuse of a monopoly. Without a shadow of a doubt the Commission is a monopoly, by virtue of the fact that there is not another one. That is what a monopoly is. If he is using that because of the tobacco that is an abuse of the position."
What about tobacco. Is it really as important to F1 as people seem to think given the current trend for new companies to come into F1?
"I believe that it would be difficult to replace the amount of money put into the sport by tobacco companies," Bernie admits, "but having said that I think that everyone knows that it will happen sooner or later. I don't know why it should happen because I don't believe that people start smoking because they see advertisements. Kids smoke because their parents smoked or because it is daring to smoke. They should not do it so they do it. I think what will eventually happen is that when other large companies see the amount of publicity they could get from F1 they will overtake tobacco and tobacco will leave the sport on its own."
But aren't the big companies and financial institutions too conservative in their thinking at the moment?
What about the Asian crisis and its effect on Grand Prix racing?
"We have contracts and Malaysia is more or less a government contract. The amount of money involved in the race in overall terms is peanuts. That is not being blase. In relation to the budget of the country and what they would get back from a Grand Prix it is not a lot of money. In Korea although it is private enterprise behind the race it is very much supported by the government. China is a different department because there are not government subsidies."
Is there going to be a Grand Prix in China?
What about Indonesia?
"I never had any aspirations to go to Indonesia. We could have gone there seven or eight years ago. They asked us to but I never wanted to go there.
"I reckon the Asian financial crisis is the best thing that could happen for Asia because it is really nothing to do with industry and the countries. It is probably a lot to do with corruption and bad management, a lot to do with the fact that people borrowed and leveraged their companies in dollars and when the confidence fell out of the country their currencies collapsed. There is no reason why they should have collapsed other than the fact that they were overvalued. I think that the people in danger are those in Europe not in Asia. I think in five years Asia will come out with flying colours and Europe will suffer."
What about racing in Africa?
"It would be good to finish the World Championship in South Africa because it is on the same time zone as Europe. The weather is good so it is a natural choice. We ought to be in the Middle East as well and there is a good chance of that happening. The problem is that there are only 16 races and I have 19 people who want them."
What are the criteria used to decide which countries will get races and which will not?
"You just look at the whole package and say: "Do we work in a good environment. Is there a town nearby. Is it being supported locally?" It is not easily to pop to India and China for example. Nowadays we use six going on seven Jumbos to move the equipment around and to get six Jumbos out of the air and positioned is not easy. If all the races happened in England it would be better. We would just take down the signs and change the backdrop."
What about the United States of America?
"Where would you suggest? You go and find a few investors, build a race track that comes up to what we want and pay us what the going rate is and we will go there. If someone wanted to do a Nurburgring, a Magny-Cours or the kind of thing they are now doing in Malaysia. Then we would be happy to go there. The problem is that everything in America is so bloody cheap and to afford to have us is not easy. They have all their own things. They understand oval racing. They understand NASCAR."
What about the individual races which are rumoured. Like Road Atlanta, Las Vegas and San Francisco?
"I bought Road Atlanta years ago but the question is would we want to be there? It is NASCAR country. It is way out of town - worse than Silverstone to get to. It is not where we want to be. The circuit will nowhere comply with what we want although they have changed it a lot but I still think it is no good to us.
"San Francisco is bad for us because of the time zones. Las Vegas is not ideal but we would have to try to run a bit early. If Vegas comes up with what I proposed maybe it could happen but you know in America it is all about the bottom line and what they are going to make next month.
"I always thought Orlando was be good for us because they were used to dealing with lots of people, so I think that might work."
The fact that Sylvester Stallone is working on a Formula 1 movie must be a boost for F1 in America.
"It will be a good movie and it will work, but I don't think it will make any difference."
Doesn't it worry you that F1 is not in America?
"We seem to have done all right since we have not had race there. It is not a problem. It has proved it is not a problem so it is not a case of what I think. It is a fact."
The other great mystery about F1 is why the sport does not take a more serious approach to merchandising. Why is that?
"I hear all these stories about merchandising but I never see the accounts of the companies. You see Nike and people like that and you think: "How much money they have spent to get that brand on the market" but in Europe you don't see baseball marketing itself aggressively. Maybe the New York Yankes, but they have been going for thousands of years. We are in a difficult position because in the end the thing that sells the most is driver-related merchandise. The drivers seem to be happy jogging along and not being very professional about it. We are looking into trying to get everyone to get it together but each one of them is proud of their own image and they all say they want to do something different. Really it is problem of the complexity of trying to get these individuals - all the drivers and all the teams - to work together when they all think they know better than everyone else."
A problem which Ecclestone has been juggling with successfully for the last 25 years in F1 racing...