The Canadian Grand Prix promoter Octane Racing Group, is found rather tight financially.
Octane Racing Group has lost money this year and has yet to pay a few suppliers six months after the test F1. A total amounts outstanding suppliers would be in the six figures (over $ 100,000), La Presse has learned. Some suppliers have made arrangements to receive periodic fixed amounts rather than being paid in full a month after the race (as was traditionally the case). The ticket payment method was also used.
“It’s true, I confirm [that amounts still owed to suppliers for the 2015 race]. This is not unusual, this is not the first time it happens. These are people with whom we do business for a long time, who are with us for many years; […] 99% of these providers then are still there and they want to make the Grand Prix, “assured François Dumontier, President and sole shareholder of Octane Racing Group, in an interview with La Presse. The annual turnover of Octane Racing Group varies between 20 and 25 million.
François Dumontier also confirmed that his company, which is the promoter of the Canadian Grand Prix since 2009, will this year a deficit despite a 6% increase in ticket sales in 2015. “It was difficult this year despite a growth in ticket sales and corporate sales. Structurally speaking, I knew that 2015 and 2016 would be more difficult, “said one who holds a contract for 10 years (2015-2024) as the promoter of the Canadian Grand Prix.
The promoter of the Canadian Grand Prix is not worried about its financial position. The holding of the race is in no way at risk, the Canadian Grand Prix figure also the Official F1 calendar for 2016. “The situation today much less worried that there are two or three years ; 2012 was the annus horribilis “said François Dumontier. In 2012, the Canadian Grand Prix promoter had also taken six months behind in paying some suppliers. His company which organized the IndyCar race in Edmonton (Octane Motorsport Events) had had to move away from its creditors.
Suppliers Grand Prix had never experienced such a situation before 2007, while Normand Legault was the Canadian Grand Prix promoter. “These are two different worlds, says Dumontier. I am a mom and pop shop, “an entrepreneur who took a chance in 2009 to bring the Grand Prix. Unfortunately I have no fortune. Like any private contractor, when things are going well, everyone is super happy. When things go less well, as an entrepreneur requires that you work with your partners, your suppliers. ”
An element that has changed since the return of the Grand Prix in 2009: the financial environment in which the Montreal promoter must evolve under its agreement with Formula One Management, owner of F1. “Structurally, the contract is not clear nor optimal. Along the way, it will soften a bit for us. It is sure that Mr. Ecclestone is a fine negotiator, “says Dumontier, who has a 10-year agreement (until 2024) as promoter of the Canadian Grand Prix with Formula One Management, the company run by Bernie Ecclestone .
To ensure the holding of the Grand Prix of Canada, governments (Canada, Quebec, City of Montreal, Tourisme Montreal) give an average $ 18.7 million per year in grants to Formula One Management until 2024. The group promoter Octane Racing does not touch a cent of these grants. Itself must also pay about 5 or 6 million a year to Formula One Management under its contract.
If François Dumontier is optimistic about the financial future of Octane Racing Group, is that he believes will soon find a title sponsor. “For us, the solution lies in the arrival of a title sponsor, said François Dumontier. [With the agreement of 10 years], now we have the opportunity to sign a title sponsor that will come stabilize the financial aspect, “he said.
The promoter of the Canadian Grand Prix “hoped” to conclude its agreement with title sponsor “before Christmas.” “I am obliged to put my patience to the test. I think it will come to fruition over the return of the Christmas holidays, “said François Dumontier, adding that his initial goal was to sign in time for the race 2017.” In 2016, it is a bonus for us, ” -he.
Octane Racing Group believes that a title sponsor would pay between 5 and 10 million per year, to be split between the promoter (Octane) and Formula One Management under the terms of their agreement. The last title sponsor of the Grand Prix of Canada, Air Canada, paying between 3 and 4 million in 2003.
Another element that could help the finances of Octane Racing Group: arrival in F1 as a Quebec driver Lance Stroll, who just signed a contract as a development driver for Williams at the age of 17 years. “The years Jacques Villeneuve were certainly good years for the Grand Prix, said Dumontier. The arrival of Lance Stroll seems closer than ever, it is a test driver at Williams. ”