Bangkok’s Formula 1 Grand Prix a done deal?

Originally published at Siam Voices on October 19, 2012

We have been following the attempts by the Sports Authority of Thailand to bring the Formula 1 World Championship to Thailand  in 2014 and even possibly to the streets of the capital Bangkok. From the first concrete declaration to bid for a race in March and the estimated costs in July and motorsports’ exhibition equivalent to All-Star Weekend, the Race of Champions, taking place later this December, we have heard a lot from the Thai organizers revving up their efforts, as much as now calling it numerous times a ‘done deal’. Ironically, this early call could potentially throw a speed bump into Thailand’s F1 ambitions. But first things first…

Rumors about a potential Formula 1 race in Thailand’s capital Bangkok have gained considerable traction this week with the Thai organizers going to press to say this:

Thailand’s government sports authority says it has struck an in-principle deal to host a Formula One race in Bangkok in 2014, with negotiations ongoing about the hosting fee, according to a report in The Nation newspaper.

Kanokphand Chulakasem, governor of the Sports Authority of Thailand, was quoted as saying “Formula One has decided to include Thailand in its 2014 season calendar” with a race slated for November. (…)

“Once the negotiations are complete, we will bring this before the cabinet for discussion and approval,” Kanokphand was quoted as saying. “We will sign a deal only after we get the nod from the government.”

Thailand government claims to have struck deal to host Bangkok Grand Prix in 2014“, Associated Press, October 18, 2012

First off, that report from The Nation is nowhere to be found! Most likely, AP has confused it for this article from the Bangkok Post, which we will get to later.

Secondly, we are used to Thai politicians and officials saying things that could be premature. Numerous international news outlets have picked up on this non-existant The Nation article and also on Kanokphand’s confident words that this deal is as good as done. However, there’s at least one important person who wouldn’t like that – both the words and especially the timing: Bernie Ecclestone, president of the Formula One Management (FOM) and effectively F1’s promoter for decades, is not a friend when the other party of a deal does something not OK’ed by him. Seasoned Formula 1 journalist Joe Saward had this to say:

Bernie Ecclestone likes race promoters who do not talk a lot and deliver deals – before they go public. Thus he cannot be overly impressed with the Thailand’s government’s sports authority, which has been putting out stories for some weeks that it will be hosting a Formula 1 race in Bangkok in 2014. If a contract has been signed, numbers agreed and guaranteed by the government then it is a good moment to make a noise, but Kanokphand Chulakasem, the man in charge of the Sports Authority, admits that the negotiations are not yet completed and the project has not been signed off by the Thai government.

A lot of talk in Thailand…“, by Joe Saward, October 14, 2012

Then there’s also the financial aspect to this. Various reports have quoted Kanokphand’s estimation that the hosting fee will be 1.2 billion baht ($39.2 million) per year and “not more expensive than Singapore”. 60 per cent will be paid by the government and the rest will come from wealthy sponsors such as Red Bull and Singha. However the bill could get bigger – a lot bigger:

It would be a surprise if the Formula One group would be willing to accept such a deal. One can understand that the total may have dropped from the high-spending days in the early 2000s, when deals up to $50 million a year were agreed. All the F1 contracts are believed to include a 10 percent increase per year, which means that a $40 million a year race fee with a normal 10 percent annual hike means that over a seven-year contract a promoter must find around $380 million, without including the money needed to either build a track or assemble and disassemble a street circuit each year. This will add around $200 million to the bill.

Thus the government must be willing to guarantee funds of around $600 million if a deal is to go ahead. If private partners are going to kick in 40 percent that is fine, but the guarantee is likely to be at government level only.

A lot of talk in Thailand…“, by Joe Saward, October 14, 2012

And finally, there’s the question about the venue of that potential Thailand Grand Prix. Many possible places have been named, from an upgrade of the nation’s only internationally certified Bira Circuit near Pattaya to a new purpose-built circuit in Chiang Mai, it looks like the organizers have zeroed in on the most obvious, but also potentially most complicated, solutions to where the F1 cars will run:

It is likely to be a night race and could be staged at Ratchadamnoen Avenue or Muang Thong Thani, the governor said. “We have been working closely with F1 officials to look for the best site,” Mr Kanokphand said. Such a big project must be approved by the government and a public hearing may be needed, he said.

Formula 1 venues in Thailand“, Bangkok Post, October 17, 2012

The idea of a night race is an obvious attempt to rival the championship’s only night race so far at Singapore’s Marina Bay. However, closing off the area of Ratchadamnoen Avenue, a large boulevard not far from the Democracy Monument but also from the back-packer district of Kao San Road, for weeks before and after race to construct and dismantle all the barriers, catch-fences, etc. would be a daunting task for literally everybody involved, especially the traffic that would be diverted.

As much as I’m personally a fan of Formula 1 and motorsports in general and have been since my childhood, a Thailand Grand Prix and much less a Bangkok city race still would not create enough excitement to care about. Maybe it’s the fact that this country doesn’t have a large enough fan base for the sport.

But maybe it is also be due to the fact of how of things work in Thailand, especially if politicians are involved in the organization of large-scale international events – or not, as the fiasco of the still unfinished Futsal stadium shows, while the FIFA Futsal World Cup is just two weeks away from now. We will have to wait and see if the Formula 1 grid will ever race on Thai soil or even through the streets of Bangkok. However, if the deal suddenly does not materialize, we may know why.