JANUARY 8, 2021
Abu Dhabi-based company to promote Brazilian GP
Formula One's sensational U-turn in the negotiations to continue holding the Brazilian Grand Prix has inflamed the already tense relations between São Paulo and Rio de Janeiro's authorities, but now it has been revealed the Abu Dhabi-based Mubadala Group will be involved in the new deal to keep Formula One in Interlagos, raising questions about who really is behind the funding of the São Paulo race.
Two years ago, with Sao Paulo's Governor unwilling to commit more money into the race and desperate to sell the Autódromo José Carlos Pace to private companies, Chase Carey got frustrated with the lack of progress in the negotiations and hastily did a deal with a new company named Rio Motorsports, agreeing to move the Brazilian Grand Prix to Rio de Janeiro for a period of five years, starting in 2021. Rio Motorsports was fully backed and funded by the local government and the big got support from President Jair Bolsonaro, so, on paper, it looked like São Paulo was doomed to lose its race.
Trouble is, of course, there was no race circuit in Rio de Janeiro, just a project to build a completely new track in the Deodoro neighborhood, some 40 kilometers northwest of Copacabana, in an area that was being used by the Brazilian army for training. It quickly became apparent this project was a non-starter, in spite of the government's backing and environmental organizations, together with some Deodoro residents managed to delay any decision of the destiny of the land where the track would be built, before the project was completely abandoned late last year.
Desperate to keep the Brazilian Grand Prix in the calendar, the FOM quickly turned on its heels and did a new five-years deal with São Paulo, meaning the fabulous Interlagos circuit will keep hosting the race until 2025, going for a run of having a Formula One race for 35 consecutive years, 2020 being the exception because of the COVID-19 pandemic.
While the financial conditions agreed by the São Paulo mayor and the FOM remain confidential – but it's widely believe the city will pay considerably less than the 35 million dollars per year that had been agreed with Rio Motorsports – it has now transpired the promoter of the race will be the Abu Dhabi-based Mubadala Group and this state owned company will charge around three million dollars per year to take care of all organizational aspects of the Grand Prix.
One of the conditions imposed by the FOM to keep the Grand Prix in Interlagos was cutting the links with Bernie Ecclestone's long-time ally Tamas Rohony, who was still acting as promotor for the race until late last year. The Hungarian-born entrepreneur was handed close to six million dollars per year to put together the structure necessary for the Grand Prix and would then return to the municipality whatever money was left – normally less than five per cent of the total amount.
Without revealing how much the Grand Prix will cost to its coffers, the São Paulo municipality has insisted that with this new deal will save three million dollars per year, as that's the difference between what Rohony was charging and what the Abu Dhabi-backed company will take.
That Abu Dhabi is expending its wings within Formula One is interesting, but it has to be reminded the Mubadala Group was heavily involved with Ferrari more than ten years ago, not only as a sponsor and partner for the race team but also has an important partner in the creation of the Ferrari World, just next to the Yas Marina Circuit.
With Saudi Arabia's state-owned oil company Aramco being the biggest sponsor of the Formula One World Championship and the country expecting to host its first Grand Prix late this year, Abu Dhabi has decided to invest more in the sport, in close alignment with the biggest regional power in the Gulf. More and more Formula One is depending on Arab funding and support to go ahead – three of last year's 17 races were held in the area, this year the number may be extended to four if Bahrain has to host a second race to make up for the expected cancellation of several Grand Prix due to the pandemic.