Chase Carey is Making Moves in Formula 1
Following the acquisition of Delta Topco, parent company of Formula One by American company Liberty Media came the news of significant personnel changes affecting the management of the auto racing business. Longtime CEO of F1, Bernie Ecclestone has been replaced by American Chase Carey, already chairman of the company. Ecclestone will remain with F1, however, as Chairman Emeritus.
Ecclestone, who had been CEO of F1 since 1978, had a noted tenure in his almost four decades of leading the business. He is credited with helping to expand the popularity of F1 racing after successfully negotiating with television networks to air races on the basis of package deals, instead of simply airing individual races.
However, some of his business decisions had been criticized. Namely, Ecclestone’s seeming overeagerness to expand the market of F1 racing in other countries rather than focus on important races. Also criticized were some of his financial decisions and handling of the company as it entered the modern world. For instance, money earned from team sponsors had dropped over 20 percent between 2012 and 2015. New CEO Carey believes that Ecclestone’s business decisions and leadership style were more effective in an earlier era.
“I think the way Bernie ran it probably worked better in years past,” Carey said. “I don’t think the one-man-show for the past five or six years really enabled this sport to grow to its full potential,” Carey said.
With Carey now in the captain’s seat at F1, there could be some very new horizons for the company to take on. Carey has selected a new managing director of motorsports, Ross Brawn, himself a former team principal with Mercedes. There is also speculation of the Grands Prix expanding to the United States, in an effort to round up an even larger international following for F1 racing.
Currently, revenue for teams in the F1 family is decided on the basis of factors such as how well their teams race and “heritage.” For last year, this meant a discrepancy of $145 million in earnings between the top and bottom teams, Ferrari and Manor Racing, respectively. Speculation is that the new F1 will aim to even the playing field in terms of revenue between teams.
Following the acquisition of all of F1’s stock for $3.05 billion, Liberty Media Group will change its name to the Formula One Group, a change which will be reflected on stock tickers, with the symbol name changing from LMC to FWON. The equity value of F1 is estimated at $4.4 billion. The company will maintain its basis in London.
Ecclestone has voiced his pride in his work with F1 as well as his hopes for the company as it prepares for change. “I’m proud of the business that I built over the last 40 years and all that I have achieved with Formula 1, and I would like to thank all of the promoters, teams, sponsors and television companies that I have worked with,” Ecclestone said. “I’m very pleased that the business has been acquired by Liberty and that it intends to invest in the future of F1. I am sure that Chase will execute his role in a way that will benefit the sport.”
by Kevin Tyler