V8 Supercar boss revs up before GP By: Ross Stapleton crikey.com.au As Melbourne gears up to be the centre of Formula One's universe this weekend, international motor sport is a huge business not only for the glamorous f1, but our own expanding...
V8 Supercar boss revs up before GP
By: Ross Stapleton
As Melbourne gears up to be the centre of Formula One's universe this weekend, international motor sport is a huge business not only for the glamorous f1, but our own expanding international V8 Supercars championship.
The V8's are the major support category on the Albert Park Australian Grand Prix programme before they kick of their own official championship season opener with the staging of the Clipsal 500 in Adelaide (March 17-20). The championship also boasts one of the world's great races on the international calendar - the Bathurst 1000, and also shares equal billing on the Gold Coast Indy Carnival programme.
AVESCO is the governing body of the sport and its chirpy chairman Tony Cochrane, has helped steer its fortunes since he brought together a fragmented Touring Car sport to launch the V8 Supercar brand and championship back in 1997. He has overseen a revolution in the sport as it has experienced year-on-year compound business growth of around 20%. It's not only now one of our most powerful and financially stable sports locally, but expanded its racing beyond these shores into New Zealand, and now this year into China.
So with the whiff of petrol fumes now permeating the air around Albert Park, this is the perfect time to take an old fashioned "good hard look" at the major swings and roundabouts of international motor sport in 2005, but particularly as it affects the business of AVESCO and V8 Supercars.
In the course of the full interview, we discuss the frenetic world of f1 and its controversial billionaire boss Bernie Ecclestone. Unsurprisingly for a man who has had to crash through plenty of barriers himself to help bring his sport into the 21st century, Cochrane's a big fan of his f1 counterpart, but not f1's dizzying cycle of litigation that is also now infecting his own sport. We also look at North America and the warring rival open wheeler championships' that sees the Indy Racing League (IRL) pitted against the struggling Champ cars, with obvious implications for the Gold Coast Indy down the track.
So fasten your seat belts as Cochrane also revs up to take on the more negative elements that he sees as trying to hold back his sport's further development. He comes out swinging against the Chinese whispers by some of these same "knockers", to confirm that not only is the landmark inaugural Shanghai V8 race going ahead in June, but he's sitting on a whole wave of good news just waiting to break. We also learn what is the current state of play on future domestic TV rights currently with the Ten network until the end of 2006.
He also answers questions on ambitious plans to race in other overseas markets including potential street races, and in that regard he sure doesn't miss New Zealand on the way through!
Q: You have one more year of your contract remaining to race at the Australian Grand Prix in 2006. What does the future hold beyond that?
TC: Well right now that's a difficult question to answer and it is complicated by the fact that next year it looks like the Grand Prix will need to be moved by a month or even a couple of months to April or May to accommodate staging the Commonwealth Games. What until this year has not been the start of our championship season, would now fall somewhere within our championship calendar in 2006, and we already have other contracts to observe within our regular season. So that's not an easy one for us to solve, but we have already commenced discussions with the Grand Prix Corporation about possible remedies.
Q: Does that leave open the possibility that if they settle on a date with Formula One that has to be met but it provides a clash with your championship there would be no V8 Supercars at next year's race?
TC: That's a possibility as a worst case scenario but I hope it doesn't come to that. But yeah that's a possibility we can't dismiss completely as won't happen.
Q: And beyond 2006 I have heard suggestions the V8's won't race at the Grand Prix?
TC: That's also difficult to answer in that we have had very informal discussions about what both of us would like to do in the future, but we're still at a very early stage where we don't really have a position going forward beyond next year.
Q: So stories you are looking to quit the Grand Prix programme are wide of the mark?
TC: Well...I guess it is just speculation at this time. We can neither confirm nor deny our position!
Q: But can you see how you might feel it is better to kick off your season from the start at the Clipsal 500 in Adelaide instead of this kind of current non-championship start at Albert Park?
TC: Well definitely from the teams' point of view that has its attractions. One of the real difficulties that at the moment we have got, there are some commercial issues attached to the Grand Prix that makes it difficult for many of our teams, and we would certainly need to address some of those issues if we were to go forward with a new contract.
Q: Would it be safe to assume that politically South Australia would be much keener for you to launch your new season in Adelaide free of the current distraction of the Grand Prix, where it could be argued Melbourne gets first crack at the V8's?
TC: Well Melbourne doesn't count against our championship so Adelaide really is the start of our season, where we only begin racing for championship points then. There are various points of view on this whole question where some people think it is good for us to be involved in the overall Grand Prix weekend and be a vital part of show when Formula One comes to Australia, where we are the leading category motor sport in this part of the world.
Then there is another point of view that believes we would be better off without our participation in Melbourne, and instead we start our season proper on the streets of Adelaide at the Clipsal 500.
Q: What were your thoughts on Melbourne promoting the Grand Prix with its Sydney Harbor Bridge stunt where I would argue the real beneficiary was in fact Sydney?
TC: Bob Carr got value for not a lot of money didn't he? But having said that; I also find it really ironic that we had tried to get permission for a truck convoy to cross the bridge as a photo/TV op that we wanted to use as part of a worldwide promotional and advertising campaign. We weren't going to stop the traffic or anything else. We were just going to have the convoy drive across on a Saturday or Sunday morning, but we couldn't get permission.
Look I guess that promotion was done with all the best intentions, but you are right in thinking people all over the world watching that race car turn on the Sydney Harbor Bridge would make the association with Sydney, and not Melbourne for sure.
Q: The U.S. Champ Car category that shares the main bill with the V8's at the Indy Gold Coast Carnival reportedly lost US$50 million in its first year of operation last season. Are they any more likely to survive than their predecessor CART which went broke?
TC: It's not really fair to expect me to answer that kind of question from 12,000 miles away but I will make these observations. The first is that the principal owners are very wealthy men and well able to sustain losses of that kind of magnitude if that's the figure for their 2004 operation.
Q: Well can you confirm you whether you have heard a similar amount as the estimated loss last season?
TC: Yes I can confirm that I have heard a figure mentioned that's in the vicinity of $40-50 million. But there's no question that owners Gerry Forsythe and Kevin Kalkhoven can easily sustain those sorts of expenses. But the second point I would make is that they have to try and resolve in America the situation where they are running two rival open wheeler championships -- that is the Indy Racing League (IRL) and Champ cars. The market just can't sustain both championships and be successful, and while that situation remains I think both will continue to suffer varying degrees of struggle.
Q: But surely if is comes down to just one being viable it has to be the IRL that survives?
TC: The IRL because it has the Indy 500 event attached to it does help give it a huge head start. They have free to air TV in North America, so they don't have to buy it...and so that is another enormous plus. And at this point in time they don't seem to be struggling at all for teams (unlike Champ -- RS), but it still gets down to there's just not the room to be able to sustain two championship series in open wheelers.
Q: Well when you take all those negatives on board against Champ Cars, does that mean they could disappear by the end of the 2005 season?
TC: No they could go beyond this season because they have two owners who have substantial asset backing.
Q: But even Rupert Murdoch can reach a point where he's no longer prepared to throw good money after bad?
TC: Well yes I guess that is true as to how much longer they would be prepared to bankroll the championship if the losses keep mounting, but that's not for me to say or speculate on.
Q: But if Champ did fall over that's a problem for the Indy Carnival here. If the Indy was then basically dependent on V8 Supercars with no foreign racing component, how do you think it would affect the current event?
TC: Obviously there would be some points of difference, but basically I think we could more than sustain the event as primarily a V8 Supercar weekend. You only have to look at the level of success we enjoy with the Clipsal 500 in Adelaide were our crowds are growing each year.
I think the Queensland Government would now agree they are in a much stronger comfort zone as regards the future of the race than they were even three years ago.
If you were to look at say the Sweeny Sports marketing research it clearly shows we are far and away the most popular motor sport in Australia and that includes Formula One. So clearly given our Australian market and our international TV presence, we would now more than fulfill the requirements of the Queensland Government and the promoter IMG, if they were faced down the track with any reason why the Champ cars can't maintain the status quo.
So I must say that I for one am not at all nervous if for whatever reason, the Champ cars fell over. But having said that I don't think there is any doubt they will make their annual appearance on the street of Surfers Paradise this year.
Q: There is a bad habit for all sport around the world to offer up all kinds of inflated global audience TV figures based on the number of potential households with access to affiliated Pay TV channels and the like.
TC: Because in Europe there aren't ratings as such which you can draw on in relation to Pay TV viewing figures and the like, we can only draw on what all sports do. That is to count up the number of households that are able to receive our pictures and that's pretty standard. With the addition of China, and the likes of Eurosport, and now Motor TV live throughout the whole of Europe, we are probably this year looking at a low of 720 million and 850 million homes globally.
But we also are going to be releasing shortly an information brochure that will contain all the logos of all our affiliated TV outlets internationally which will give a better indication of just how widely our TV pictures are being distributed which is the most open and honest way I can see of doing it.
But with the likes of NZ, South Africa and Europe taking our races totally live we're very happy with our global TV footprint.
Q: Where are you as regards your debut race in Shanghai in mid year?
TC: That's become the most commonly asked question now. We are well advanced in all our plans with the Shanghai International circuit and the Chinese promoter. That planning is also at Government to Government level and there will be a number of senior level political figures from Australia attending the race in June 10-12th (round 5). The hotels and all the freight is booked and our CEO Wayne Cattach has just returned from another trip up there, as well as having a permanent AVESCO person on the ground in Shanghai, so everything is go with all our planning well advanced.
Q: Are you mystified that there appears to be still some sections of the motor sport media who are not only dubious about the benefits of such a race but whether it will happen?
TC: No I'm not because they're journalists (laughs)! Look it gets to a situation where you get sick of telling people you can believe the rumour or innuendo, but I know there is now a seven figure deposit in our account in US dollars. I know what work has been done, what's been booked and I know that the Federation of Auto Sports in China has finished training all the flag Marshall's, and I know the FIA has signed off on that process. So there is only so many times you can respond to the rumour as these same people keep asking the question every six weeks. So I am no longer going to respond and all we can do now is wait until June, and then people can judge whether it went ahead of not.
Q: Is there a section of the sport suffering a form of xenophobia that is basically opposed to V8 Supercars racing beyond these shores?
TC: I think there are two aspects to that. I think firstly we have got a certain sector of media that are permanent knockers of anything AVESCO. We are in a sense permanently in their sights because in their mind we have never done anything right so they just continually knock us. Then there is another group who just want to see the championship raced only in Australia for their own selfish reasons...whatever that may be. They don't want to share a wider vision to build the championship, or create a bigger motor sport industry here including more jobs.
Q: Are you prepared to identify who might be that particularly lobby or individuals who you see as hyper critical of AVESCO?
TC: Oh...I think people like Bob Jane sit around being critical of AVESCO. I think there are various journalists and various web sites that hide behind whoever they really are, who perennially chip away at whatever we do. They need to get a life! But you know what? In a lot of cases I don't even know what their particular problem is with us? Seriously I have never understood the agenda of some people...it's just a bit of a shame really.
Q: But it's also inevitable with media where I can be a huge admirer of the way the AFL has built up and developed the sport. That to my mind it gets say 90% of it right, but you are far more concerned with what they get wrong?
TC: Yeah well I think there are certainly one or two journalists in Australia who will overlook 30 great press releases to print one story that is negative about us. Certainly that seems to be the Sydney Morning Herald's approach to the sport...and good luck to them. If that's how they get their "jollies", then so be it!
Q: It's been mooted that the next foreign frontier for V8 Supercars is the Middle East and most likely Dubai?
TC: Well I suppose the Middle East is sitting in pole position when considering our next international expansion, but having said that we also have a lot of interest coming out of Asia and the same with South Africa. But right at the moment I would say the Middle East is the primary candidate. Thailand and Singapore are the two Asian prospects and both would also be a street race if they were to happen. In Thailand we wouldn't be looking at Bangkok but a tourism area.
Q: An Auckland street race looked all systems go and then it hit a brick wall. What happened?
TC: The Auckland race is probably one of the great debacles in major sport in this part of the world. There was a city that enthusiastically bid for the rights and won the bid, and spent $1.3 million proving up the bid for their Resource Development Consent (RDC). But then had the whole process overturned by three judges on the consent panel. So now Auckland couldn't be deader in the water if it tried.
Perhaps I should explain that as part of the draconian laws in New Zealand, anything that is to be built; first needs this RDC approval which means it must go before three judges on this panel. It seems if you are going to build something and the course needs to be built; even though it is only of a temporary nature it still gets caught up in this process. So in the end the race was killed off by their own red tape. The Government said they couldn't intervene even though it was going to be a spectacular international event for Auckland, claiming it had to follow due process.
Continued in part 2