N News & Results

Bell has bought the Octane Racing Group; will be the new owner of the Montreal Grand Prix organization.

Montreal, QC Apr 30/21 (GRW): Hard on the heels of the decision to cancel this year’s Canadian Grand Prix and the agreement with the Formula One Organization (formerly Liberty Media) to extend their contract with Montreal for the GP until 2031, comes the announcement that the Quebec wing of the huge Bell corporation has bought Octane, giving them control of the race into the future. The Octane enterprise will continue as a part of Bell’s organization structure.

Through its sports broadcasting arm, TSN, which holds broadcast rights to the Formula One series races, Bell has had an interest in Formula One for many years. As for Octane, the actual ownership of that organization has never been entirely clear and they have shown some signs of possible financial distress. They have delayed indefinitely offering cash refunds for the tickets sold for the cancelled 2020 Grand Prix and recently it has been reported that they had gone hat-in-hand for a six-million-dollar subsidy from various government bodies to compensate them for their inability to sell tickets for this year’s planned race.

Now, with Bell at the controls, race fans should be able to opt for refunds or to convert their 2020 tickets to tickets for the 2022 event.

The decision to move the Canadian Grand Prix to Montreal in 1978 only came as a last-ditch effort after the then organizers had failed to obtain permission from the Toronto city council to build a semi-street circuit on and around Toronto’s Exhibition Place (home of the CNE). Of course, some years later this idea was revived and there is now a course with a similar layout at Exhibition Place which hosts the annual IndyCar race.

This move to Montreal has turned out to be an excellent turn of events. We now have a well-designed race track for the Grand Prix cars which is one of the best of the current selection of GP circuits – and a solidly based organization to run the event. Given the quality of the racing here in combination with the track being within subway/taxi distance of downtown Montreal with all that offers, it has been one of the best Grands Prix in the world for spectators. Added to that, the F1 Organization has now declared its hopes to have a number of F1 races in America – next year there will be two, COTA and Miami – and the well-established Montreal track can be considered to be part of that strategy, given its proximity to F1 race fans in the north-eastern part of the United States.

One sign of the value of this event to the F1 organization is the fact that the figures quoted for the fees the promoter must pay – in the order of $25 million rising to slightly over $30 million over the life of the ten-year contract – are significantly less that the fees they extort from many of the other F1 race rights-holders – especially those in the Middle East and Asia. The F1 Organization clearly wants to see the Canadian Grand Prix remain on their schedule.

Remember that it was Bernie Ecclestone’s stated goal of forcing any would-be F1 race organizer to find government funding to pay the huge rights fees he was demanding – and it seems that this policy is still in place. This is the reason why the F1 race at Indianapolis, which was a sporting success but a financial disaster, ended – Tony George had been unable to tap into government funds to stage the F1 race and his agreement with F1 left him with almost no place he could raise money in the conventional sponsorship avenues. F1 held the TV rights and essentially all rights to sponsorship.

It is well-established that, in the US, the various government bodies lack public support for using public funds to shore up profit-making sports enterprises. For that reason, previous versions of the USGP have faded away and the current two must continue to struggle to make their race events break even.

The Montreal GP has received a substantial amount of government subsidy from the national, Quebec and Montreal public coffers. In addition, tourists pay a surtax on hotel rooms in Montreal year-round; a significant part of this fund goes to subsidize the Grand Prix as well. All this, plus the sell-out crowds spending $500 and more for seats at the race, gives the Canadian Grand Prix a financial base that enables them to pay the relatively modest sanctioning fee required by the F1 Organization.

However, while Montrealers and Quebecers may be happy to see their tax dollars going to subsidize an event which obviously generates a lot of tourist business for that city, Canadian taxpayers outside Quebec are not quite so sanguine about their tax money being spent this way, making it harder for the federal government to pay out vast sums of money to subsidize this city-centered tourist extravaganza.

So, having Bell taking over the organization, with its deep pockets and, no doubt, well entrenched influence with the Quebec and the federal governments, and the ten-year contract with the F1 organization, it looks like the near-term future of the Canadian Grand Prix in Montreal is assured.

In years past, there was a conflict between the non-political governing body of motorsports in Canada, the Canadian Automobile Sport Clubs, and the people at the Montreal venue who had sold sponsorship rights to a rival sponsor. This was solved by having the FIA expel the CASC as Canada’s ASN and setting up a non-elected ASN which served Ecclestone’s interests. Recently, this unelected ASN was disbanded and it has been replaced by a new non-elected ASN. The president of the new ASN governing body is François Dumontier, the same person who continues as the president and CEO of Octane Racing Group now owned by Bell. Obviously, Bell need not worry about any difference of opinion between the Canadian governing body (the ASN/Sports Development Group) and the management of the Montreal Grand Prix, given that they are essentially one and the same people wearing both hats.

-30-

Popular News

top logo 2018

PRN Motorsport Magazine.

For Canadian Race Fans and Racers

Since 1989

Email:

Info@prnmag.com

Phone:

1-800-667-RACE

Social Links