Report: '09 F1 participants needed to sell more than 25,000 cars to break even on inv

Report: '09 F1 participants needed to sell more than 25,000 cars to break even on inv

Filed under: Motorsports, BMW, Mercedes-Benz, Toyota, Earnings/Financials, Ferrari, Renault



Melbourne, Australia newspaper The Age has a story on the break-even point for automakers in Formula One. The numbers are based on research done by Formula Money, a company devoted to detailing the financial goings-on in F1 - however, they don't make much sense at first glance. According to The Age, F1's manufacturer-backed teams "Ferrari, Mercedes-Benz, BMW, Renault and Toyota spent €608 million ($970 million) on Formula One racing" last year. To recoup that total investment they needed to sell at least 25,000 cars, combined, at an average price of $38,800.

The questions arise when it is claimed that Ferrari "makes €275,000 ($393,643 U.S.) per car sold, and so only needs to sell 153 vehicles to break even on its €42 million ($60 million U.S.) investment in F1." We can hardly believe Ferrari spent just $60M on F1 last year; if so, that would have left the other four teams to spend an average of $227.5M apiece based on a total spend of $970M.

According to F1 Fanatic's team budget numbers for 2008, Ferrari spent $414.9 million, and going by F1 Network's numbers for 2009, Ferrari spent $365 million last year. We don't know where the truth is among the numbers in The Age's report. What we do know, however, is that no matter what the real numbers are, they never added up for BMW, Renault or Toyota.

[Source: The Age]Report: '09 F1 participants needed to sell more than 25,000 cars to break even on investment originally appeared on Autoblog on Mon, 04 Jan 2010 09:29:00 EST. Please see our terms for use of feeds.



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