Manufacturers vote for breakaway series
Is ACEA's decision designed to call Kirch/EMTV's bluff?
The fabric of Grand Prix Racing could be torn apart following a decision
from the five European manufacturers involved in Formula 1 to form a
breakaway single-seater championship at a meeting in Italy today
(Wednesday).The European Automobile Manufacturers Association (ACEA)
concerned that German media giants Kirch and EMTV, which have got the
green light to buy 75 percent of the commercial and television rights to
F1, will make all Formula 1 TV coverage pay-per-view. As such ACEA has
voted unanimously in favour of withdrawing from F1 to start up its own
series.
Some Formula 1 insiders believe the ACEA's decision is a symbolic
gesture designed to force guarantees from Kirch and EMTV that Formula 1
will remain on terrestrial TV. The association's chairman Paulo
Canterella was in fighting mood after the meeting.
The ACEA and Fiat chairman said: "As a result of recent developments,and
in the best interests of motor sport, it has been unanimously agreed to
set up a joint company, the purpose of which will be to establish, as
soon as possible, a new open-wheels single-seat racing car series."
Should the breakaway championship go ahead, it would signal the end of
F1 involvement for Ferrari (Fiat), Mercedes, BMW, Renault and Ford, and
would leave the future of the teams which are currently supplied engines
by the manufacturers in serious doubt.
The situation is further complicated by the manufacturers owning shares
within the teams to which they supply engines, giving ACEA an amount of
leverage from the inside.
The idea of a breakaway championship was first raised earlier this year,
but following investigations by the German monopolies commission it was
believed that the manufacturers' unease at the Kirch/EMTV majority had
been significantly reduced, making today's decision something of a
surprise.
The stance of motorsport's governing body, the FIA is that it would
consider sanctioning any alternative series as long as it met its
existing criteria on such matters as safety.
Story earlier this week:
Media giants F1 buy-in passes final hurdle
German monopolies commission gives thumbs-up to buy-in
Kirch and EMTV, the media giants in the throes of finalising a deal to
secure a majority stake in Bernie Ecclestones Formula 1 commercial
empire, have been given the green light by Germanys equivalent to the
monopolies and mergers commission. The Federal Cartel Office says it is
satisfied that Kirchs planned US$1 billion purchase of another 25
percent stake in Ecclestones family-owned SLEC trust would not give it
exclusive control of broadcasting rights in Germany. Fears had been
voiced by the motor manufacturers involved in F1 that Kirch and EMTV
would use their majority holding to engineer F1 into an exclusively
pay-per-view sport.
The sports governing body, the FIA, has also given the deal an okay,
meaning that Kirch and EMTV are free to complete the formalities that
will see the companies owning 75 percent of SLEC between them.
The car makers themselves are still interested in securing a stake in
SLEC, and Kirch and EMTV have already expressed an interest in
off-loading a percentage, but doubts are said have been raised over the
viability of such a deal.
IN this weeks Autocar magazine, a Ferrari insider said: The car makers
want a share in SLEC at a realistic price, but there are many who
believe that Bernie Ecclestone has put too high a price tag on such an
investment. We dont have to buy in.
Kirch is set to place former Philip Morris executive Walter Thoma on the
SLEC board, according to the Financial Times newspaper.
The 64-year-old former head of European operations at Philip Morris, who
will be one of six Kirch representatives on the SLEC board, was
instrumental in bringing Marlboro into F1 and also worked with F1 boss
Ecclestone on his aborted plan to float the business on the stock
exchange.
Thomas appointment is believed to be in an attempt to increase the car
manufacturers confidence in Kirchs role in and plans for SLEC.