How much does it cost for a city to host the Formula One circus? Well, considering how clandestine are the dealings of F1 supremo Bernie Ecclestone, we may never fully know. But, thanks to some leaked information to Australia's Herald Sun, we do now have a pretty good indication of what that city must pay for the privilege of being an F1 venue – and it ain't cheap folks.

In an exclusive report from the Aussie paper, we're told that Formula One's license fee for the Australian Grand Prix, in Melbourne, Victoria, has increased in price each year of a five-year contract; starting at $31 million (US dollars) in 2011 and moving up to $37 million in 2015. In fact, in 2012, the $32.5 million license fee to F1 was the major line item in a total of some $56.7 million paid by, according to the Herald Sun, the taxpayers of Victoria.

The fee paid to F1 has been a well-protected secret up until now, and officials from both the racing organization and the Australian government are refusing to confirm or deny the figures reported via the leaked documents. Government officials have been vocal in their defense of the soundness of the business decisions behind bringing and keeping the race in Melbourne, however. And, in fact, former Premier Jeff Kennett went so far as to say that the deal is a bit of a steal, relative to what other locales pay to Formula One.

Of Ecclestone Kennett said, "Victorians have been getting it at such a good deal, it might cause him some embarrassment."

Scroll down for a statement on the leaked fee documents, and more, from Grand Prix Corporation chief Andrew Westacott, in the video below.


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  • 16 Comments
      ShutoSteve
      • 2 Years Ago
      Autoblog, don't get my hopes up for a wicked photo gallery like that ever again.
      Thomas Macso
      • 2 Years Ago
      Ecclestone is a mafia crook, always has been, always will be. Enriching himself is the name of the game NOT improving F1.
      Autoblogist
      • 2 Years Ago
      It's sounds like a lot of money and it is, but if the tax revenue generated from the race warrants that price, I don't see the problem. I don't know the laws of Australia, but I'm sure if the any government entity were to front the cash for an F1 race then it would be public in the states. I don't know if Austin released the info on tax revenue for the week of the US Grand Prix, but I'm sure it wouldn't be hard to figure out how much money the race brought in.
        ufgrat
        • 2 Years Ago
        @Autoblogist
        Estimated economic impact for Austin was $300 million. I'm also reasonably certain that the sanctioning fee was $25 million, so I doubt Austin will be that upset to hear Victoria paid $32.5.
      john
      • 2 Years Ago
      It would be interesting to see how much each city winds up profiting by hosting races on a yearly basis. It'd probably be difficult to track once everything is factored in.
        SloopJohnB
        • 2 Years Ago
        @john
        There are no profits by hosting races on a yearly basis. Tax revenue does not make up for the increased crime, pollution, litter, and outright subsidy of these races.
          Reparkable
          • 2 Years Ago
          @SloopJohnB
          There's got to be some upside. What about all the extra cash from fans pumping into restaurants, hotels, retail shops, bars, clubs, rental cars etc etc? What about showing your city to millions of people around the world annually on TV? That must account for something. No increased tourism form that?
          Phil T
          • 2 Years Ago
          @SloopJohnB
          You clearly have no clue about the economics of such events. Yes there is a big fee that everybody sees but there are other things that people don't readily understand and its not just about direct tax revenue. Events such as these create employment in the set up, running and clean up of the event. It obviously generates income and employment in hotels, restaurants, cafes and bars. There is also the positive effect it has on the morale in a state - it was pretty crappy before the government implemented its major events strategy including F1 but the place has a positive buzz since then. That continues with the positive image portrayed worldwide during the event which translates into tourism dollars. The benefits to the state are such that successive governments from both sides of the political divide have seen fit to renew the contract while they have been in power. As long as it continues to make the economic sense it has for the last 17 years they will continue with it.
      dukeisduke
      • 2 Years Ago
      This information needs to be made public, as it's taxpayer money that is being spent. I don't know if Australia has something equivalent to the US's Freedom Of Information Act (FOIA), but if they don't have one, they sure need one. The public needs a say on whether their money is paid to Ecclestone, and what kind of return they're getting on the "investment".
      snap_understeer_ftw
      • 2 Years Ago
      Excellent title. no joke
      petrol42
      • 2 Years Ago
      Nobody can be certain how much revenue a Grand Prix brings to the city hosting one. Take Austin for example. How does anybody know how much revenue was brought in by all the businesses unless all the businesses reported their income for just the Grand Prix weekend. Also, in addition to whatever Austin paid for to host their GP, Austin also had to have more police on duty, more maintenance workers to keep the city clean before, during and after the race. This probably more than doubles the amount it costs to host a GP. I think any numbers you see that are thrown out by the media are fudged anyways. I also think the taxpayer gets royally screwed because every state and every city in the US is in debt up the yin yang. I'm willing to bet that some of these cities with debt are due to hosting sporting events or buying stadiums for the home team. But in the end, who cares? F1 fans and all other sporting fans just want to tune into an enjoyable sporting event which we get and nobody thinks about the tax hit the city takes. It's just a bunch of hullabaloo.
      Henry
      • 2 Years Ago
      Guys, that was a cruel joke.
      Brodz
      • 2 Years Ago
      And Andrew is right... I'm sure the city of Melbourne gets more money back in revenue over the weekend then the outlay.
      • 2 Years Ago
      [blocked]
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