Monday, November 17, 2008

Niceland

While some of us may be singing;
Happy Days are here again
Happy Days are here again


I’d suggest it’s hardly time to roll out the barrel... (Pun intended) as Y’all know, we’re in a world of economic hurt! Just-in-time for the upcoming Holidays, eh? And I don’t think it’ll rebound anytime soon? As the following scenario’s are playing out in the Motorsports arena, having already noted the impending merger of DEI and Ganassi/Sabates in RASSCAR, along with the news that RASSCAR has banned all testing next season, plus the current glut of driver’s on the free agency market in Indy Car’s, not to mention the most likely lower car count next season...

As it should be apparent, that when the economy goes into a tailspin, extra-curricular activities such as motor racing are usually effected, if not hard hit in justifying the multi-million dollar expenditures of running successful racing operations.

Thus, turning our attention to the world of Formula 1, I had to laugh upon catching the gimmicky ING advert that ran multiple times during the season finale in Brazil, where the crowd goes wild chanting Fernando, Fernando in the glitzy promo...

This after the Netherlands largest banking institution posted its very first loss of $500 million euros ($670m USD) since being formed in 1991, with its company roots dating back to 1743. News of the loss seemingly sparked a shares sell-off as ING’s stock price dropped 27% and is down 70%+ this year, as the banking and insurance giant will reportedly sell an 8.5% stake to the Netherlands government in order to secure up to $9b Euros of cash infusion...

Obviously ING is a big player in the world of F1, as it not only is the title sponsor of the Renault F1 team, but also sponsors several current rounds of the Formula One calendar along with substantial race track advertising.

Meanwhile, the Williams team would appear to be in an even deeper threat of financial turmoil, as various sponsors are in economic trouble, with the team relying heavily upon Iceland’s Bogger Group’s Hamleys and mydiamonds.com, RBS (Royal Bank of Scotland) and Brazils’ Petrobras sponsorship.

As we’re all possibly aware of; Iceland is in current economic meltdown, as the country defaulted on its national currency and is currently seeking rescue from the International Monetary Fund, (IMF) to the tune of a $6b aid package, (can you say bailout?) which to date, hasn’t been approved as foreign banks seek repayment of current investments, while Ukraine and Hungary also are currently seeking financial aid packages from the IMF in order to stave off potential bankruptcy. Yet, Spain is currently in a major slump and the German government has just announced an $80 billion ($108b USD) financial aid package that allows for 5% to not be repaid...

Meanwhile the Royal Bank of Scotland has been taken over by the British Government in an attempt to recapitalize the Scottish bank, which has two years remaining on its sponsorship deal with Sir Frank Williams.

And lastly, Brazilian oil giant Petrobras, will depart the Grove squad in favour of Honda’s Brackley based F1 team for the 2009 season, as it seeks to pursue sponsoring a young Brazilian driver in favour of Williams current driver duo.

Thus, these are just some of the current financial implications affecting just two of the current ten Formula 1 Constructors, not to mention potentially affecting Emperor Bernardo’s bank account... Nah!

Yet, while oil sponsorship may seem impenetrable in some circles, I’m sure that all major corporations are having to rethink their long term marketing plans and perhaps Scuderia Ferrari Marlboro may wish to rethink its rumoured sponsorship tie-up with Spanish bank Santander,, ci? Of course this deal was allegedly on the condition that Fredrico Suave, a.k.a. Fernando Alonso joined the Scuderia as Kimi Raikkonen’s replacement, which now seems unlikely until 2011 at the earliest and thus, I’d assume the Spanish bank will continue its original contract with McLaren thru 2009...

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