Millionaire Account Explains Why SP Presses For GP Date Change – 08/17/2021

Millionaire Account Explains Why SP Presses For GP Date Change - 08/17/2021

Important numbers were released at the press conference in which the Governor of the State of So Paulo, joao doria (PSDB) announced that at least 20,000 more tickets for the So Paulo Formula 1 GP will go on sale at the end of the month, when the organizers are expected to receive a response to their request to change the category at the end of July. Was sent. Race dates from November 7 to 14. These numbers reflect the concern of the authorities to ensure the financial return of the event to the city and state, which are investing heavily to maintain the event, the city considered the second largest in the capital in terms of financial movement. Is.

That the Formula 1 GP brings many visitors and propels the city’s economy is no doubt: according to Vinicius Lumertz, the Secretary of State for Tourism, in 2021, 76% of those who bought tickets so far were outside So Paulo. are of. The size of the account borne by the government has changed since the signing of a new contract with Formula 1 at the end of last year: from less than 40 million to less than 150 million a year.

Why was GP more expensive for So Paulo?

The difference is that, like all other stages on the calendar, with the exception of the Monaco GP, Brazil will now have to pay the F1 annual fee to participate in the race. In recent times, this fee was paid in large part by TV Globo, and when the network stopped doing so, the competition’s promoter, Tamas Rohony, struck a deal with then F1 boss Bernie Ecclestone, who previously He had sold the deal for Liberty. media, so that Brazil can be exempted from this duty, which has been in place since 2017, when North Americans were already in control of this category.

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This arrangement meant that the city of So Paulo, which owns Interlagos, had to bear only operating costs, such as safety and cleanliness, given that it did not exceed 40 million a year, in addition to the maintenance of the racecourse. fell. Although the box office value remained with the promoter, the event was quite profitable for the city as it is estimated that in taxes alone, the return is around reais 111 million.

Description of Interlagos Autodrome in So Paulo City

Image: Duda Barros/AGIF

However, the new contract, with the payment of F1’s performance fee, brought Brazil back to the reality of other places on the calendar. In May, the blog Olhar Olimpico revealed that an invoice sent by category to City Hall showed the charge amounted to $25 million a year. Therefore, although the contract with the new promoter, Brasil Motorsport, the company led by Alan Adler, provides for a small annual transfer (20 million reais), the total account in the public treasury is more salty: considering the exchange rate for payment. The second installment of $22.5 million, paid by City to F1 on 1 June, brings the total payment paid by City to the category and the company promoting the event is close to 150 million reais.

Now with a more salty bill, public officials need all the help they can to make the event as profitable as possible. And here comes the request to change the date of the Proclamation of the Republic, Monday, November 15, to the next weekend from November 7, which is close to a national holiday. By Doria’s accounts, the close of the holiday run could result in a turnover of “25% higher, that is, 100 to 140 million reais more” than the previous week, as people from out of town and out of state enjoy other attractions and more. Stay on time

In a 2019 count by the Getulio Vargas Foundation, which is currently used by the government, the total movement of GPs – in which everything is generated, not just public coffers – is 670 million (and Lumertz said at the press conference that he expects the number to be “20 or 30% higher this year”, as one estimates demand has pulled back due to the pandemic), creating 8,000 jobs and media exposure for the city in the heat of 1.6. with. Arab Reis.

British rule made it difficult to set dates

But will the request be accepted? The situation is not simple. Currently, Brazil is on the UK government’s Red List, where most of the people working in F1 live. This means that, on their return, these professionals will have to isolate in hotels for 10 days, which is not accepted by the teams. According to Doria, SP’s proposal would be reversed with Mexico, indicating that the category plans to address the red list issue by conducting tests in Mexico City over the weekend after So Paulo, which will extend the period of isolation upon returning to England. does less. However, Mexico has just entered the British government’s Red List, so if that was indeed the plan, it was no longer possible. Mexico and Brazil’s position regarding UK rules is one of F1’s problems for the second half of the calendar, which will be announced, at least partially, at the end of August.

About the author: Sarah Gracie

Sarahis a reporter covering Amazon. She previously covered tech and transportation, and she broke stories on Uber's finances, self-driving car program, and cultural crisis. Before that, she covered cybersecurity in finance. Sarah's work has appeared in The Wall Street Journal, Bloomberg, Politico, and the Houston Chronicle.

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