The Singapore Government has agreed to renew their hosting rights for the Singapore Formula 1 Grand Prix for another 4 years until 2021, with a view to dominating the sports tourism market in SEA
The stakeholders – Formula One, Singapore Tourism Board and Singapore GP Pte Ltd – timed their announcement on the official practice day of this year’s race, the final planned one under the current contract.
Commentators in Singapore were speculating that the government were holding off closure to try to secure a better deal, but other factors stalled negotiations, chiefly the sale of F1 from Bernie Eccelstone to Liberty Media, and the installation of the new F1 chairman and chief executive officer Chase Carey in January this year*.
Why have Singapore renewed? Well, the official release has stated that the race has attracted over 450,000 additional international visitors to Singapore since the F1 began in 2008, and has brought in US$1.04 billion (S$1.4 billion) in tourism receipts over the last decade.
Singapore’s Trade and Industry Minister, S Iswaran went further to acknowledge some additional benefits, “The Singapore GP has generated significant benefits for our economy… With its global viewership and media coverage, the race has reinforced Singapore’s image as a vibrant and innovative city to a wide international audience.”
Iswaran added that the cost of organising the race has been reduced to about US$100 million per year (S$135 million), previously S$150 million. Based on these released figures, the race has more or less broken even on its first ten years… which is better than results from some of the more established races in Asia Pacific, such as Malaysia – which will cease permanently after this year’s race in a fortnight after sliding F1 ticket sales and the general lack of track usage at Sepang – and Melbourne which loses millions each year. The Singapore government co-funds 60 per cent of the organising costs.
There were fears that the appeal of the Singapore Grand Prix was fading after ticket sales for last year’s event fell. Its daily average attendance – 73,000 – was the lowest in nine years but this year’s race has already experienced “a year-to-date 19 percent increase in ticket sales, with the weekend sales still to be included.” It remains to see if this is a bubble induced by the possibility of this being the last race in Singapore.
One thing that is 99% certain is a new title sponsor. Singapore Airlines’ deal with the race ends this year and with few home-grown brands able to afford the 8-figure price tag – a previously almost unwritten rule in the event’s construct – it may be that a non-Singaporean brand takes on the title.
* Carey succeeded former F1 supremo Ecclestone after Liberty Media’s US$8 billion (S$10.8 billion) takeover of the platform.
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