The Hidden Economics of Formula 1

Driver61

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    The top F1 teams each spend about 175 million dollars per year to put the best cars on the grid and pay fees of up to 5.5 million dollars just to enter the championship, the money involved in Formula 1 is just ludicrous.
    The sport is a global cash-making machine that employs 50,000 people and dishes out an incredible one billion dollars of prize money to the teams.
    This money is used to build the fastest race cars on the planet and fund driver salaries of over 40 million dollars.
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    Formula 1 is run by Liberty Media, which bought control of the Formula One Group for 4.4 billion dollars in 2016.
    There were an incredible 433 million viewers of F1 races last year, so it’s no surprise that Liberty makes most of its money from TV rights.
    TV outlets such as ESPN and Sky give full coverage of each race weekend and pay a huge amount for the privilege.

    Sky is by far the biggest source of TV income, with a 255 million dollar per year deal that is the biggest in the sport’s history.
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    #Formula1 #Economics #Engineering

    Pubblicato il Mese fa

    Commenti

    1. Joaco Garcia

      Messi and Ronaldo earn almost double as Hamilton in salary but divide that salary between the amount of games played and races run and i Bet Hamilton is a lot more expensive per Day, Game, Hour, etc.

    2. Aaryan Prakash

      Lance Stroll Deserves His Seat Don't even compare him to that other git

    3. b3nje909

      I thought buying into F1 was 250million...?

    4. Nixer Doyle

      Liberty bought F1 for $4.4 million? Dang, I should have got in on that!

    5. kary lemay

      To

    6. kevin k.k keah

      This model is exactly what the European Super League were trying to achieve. Ensuring consistent profits

    7. Jason Brown

      Great video!

    8. flounder2760

      I imagine some of the payment for these people is just the job itself... I imagine I could put up with alot if people let me drive a race car for a living

    9. Hanan Zaikhan

      Ferrari last WC was 2007

    10. Ghett Away

      Had to write all of this down to make it make sense. Smh

    11. vizibiciklii

      Stroll have won a lot of championships, he is not in the sport because of his father. He is a good driver.

    12. Ash Geo

      Racing is a sport that has money written all over it - right from the grassroots, up to the top level F1.

    13. Mosinlogan

      How wild would it be for your dad to buy you a job as an F1 driver for your 18th birthday....

    14. Delano Castro

      Very interesting. Thank you!!!

    15. theidn

      i didnt know i need this. subscribed.

    16. Laurence Gough

      Hundred$ of million$ of rea$on$ to enjoy my Miata...

    17. Keith Bondar

      Just got into F1 and I love everything about it!

    18. Bryan Tait

      alpha tauri's clothes are shit though

    19. Rick in Texas

      I’m a new fan to F1 because of Drive to Survive. These videos definitely help me enjoy this sport more. Many thanks!!

    20. Ravid Efroni

      Super interesting man! Thanks for making this

    21. Piotr Babiuch

      Well ferrari deserve that pay for what they done for whole motorsport

    22. CSM

      This is interesting, but you forgot to mention that F1 is currently the most boring motorsport on earth.

    23. Bálint Szép

      5:54 "Current examples include Lance Stroll and Nikita Mazepin..." poor Nic Latifi is forgotten even in this lineup. :c

    24. Jeff Mattel

      4.4 MIIIIIIIIILLIIIIIIOOOOOON DOLLARS. (insert Austin Powers pinky to the side of the mouth emoji) MUAHAHAHAHA....................muahahahahaha.................MUAHAHAHAHAHA................

    25. Stanislaw Żelazny

      What is the weird vehicle in the background at 4:23? 🤔

    26. Buena Vida

      its an unfair amount of money for Ferrari, but I can understand why they want to keep Ferrari in. It wouldn't be the same. Bottom line is, having that money poured into Ferrari assures every other team continues to receive higher amounts of money.

      1. Sebastian MARCIANO

        It's fair. Like in normal life, if you work for 25 years, you get paid more than new starters.

    27. DJ_CodNub

      4.4 M dollars? I would have bought for 5 M!

    28. DJ_CodNub

      Step 1. Collect underpants Step 2. Step 3. Profit!

    29. Ludwig Gaisbauer

      4.4 million dollars....must must be dreaming

    30. Along Aier

      F1 isn't just tough technically, F1 is also tough economically!!!

    31. March Hare

      Is it really hidden? I mean, only the exact number of these incomes and expenditures are hidden

    32. Ahhww tvee

      Lance is no talent? the guy obiously can deliver

    33. Ollie

      Drugs. Shipping drugs. C'mon, who's policing the drug imports/exports really?

    34. Shahaan Shah

      Excellent video, thanks so much, and would love if you could post sources in the description! I still have a hard time understanding how much sponsorships and marketing-by-association can drive business... putting your name on a car, or having your own team, that seriously generates business to the tune of tens or hundreds of millions of dollars? That's just wild to me

    35. Wadeed Ahmed

      well i did buy a can of redbull merely cuz i was supporting max. Although it tasted horrible. It gave me a sense of loyalty to max and redbull. What a waste of 280 rupees.Youre welcome christian.

    36. Bad Gumby

      To me, racing sponsorships, especially at this level, are a huge waste of money. I have never bought anything because they sponsored racing. My opinion again, I don't think any driver is worth paying $40 million dollars a year. That's just crazy. Motorsports has pretty much always been about money. But now, it's out of hand.

    37. jozefemperor

      this video is so good!

    38. shaun

      thanks for this video! by the way, anyone know what car this is? 9:58

    39. Pandamasque

      Some statements were rather dubious. 1. If government funding of a Grand Prix was so lucrative for local economy, how come the only ones doing it are vanity-driven dictators in need of whitewashing their image? 2. If exposure on the the cars was such a great deal for sponsors, how come most cars run with blank sidepods or running logos of entities associated with the team owner? F1 sponsorship went into decline since FOM sold TV rights to pay-per-view outlets and casual viewership in most of the world went to pretty much zero. When F1 was on free to view TV even the backmarker cars were splattered in sponsor logos.

    40. American Citizens - Important Message

      Americans - What We Believe - click here to listen

    41. aLex Naturalis

      So Ferrari is such a massive brand that F1 is willing to pay them bonuses beyond other teams? You can grumble about it but it shouldn't be controversial. It's not entirely F1 that's bringing in the fans, it's Ferrari too.

    42. Jeff Stone

      If you want to make a small fortune in racing, start with a large fortune!😂

    43. Ali S

      52 countries for TV viewership isn't a lot. The fact that F1 isn't shown on extra terrestrial TV means there's been a decrease in viewership.

    44. Clueless Gamer

      Basically the sport is only for the rich/elites.

    45. Phil Hawtin

      4 million only?

    46. Aditya Khapre

      4.4 million?!😂 That's a bargain I would say

    47. ALEXANDER STOCKHAUS

      your numbers are very wrong...

    48. Joe Moores

      *GET AUDI INTO F1*

    49. Joe Moores

      *GET AUDI INTO F1*

    50. Steven S

      Now do one for gt world Imsa Gte Etc.

    51. Ashsaloft

      if your accent wasnt so shit it wouldve been enjoyable

    52. thatbastian

      well done mate brilliant video

    53. james pisano

      Dude. I love your stuff. Great video! Interesting.

    54. Zak Hussain

      CORRECTION ; 82m$ isn't even close to what the most valuable prize in football is🤣 that's what the smallest teams in England earn, the trophy you have showed earned a club upto 135m$

      1. Zak Hussain

        @Sebastian MARCIANO ????

      2. Sebastian MARCIANO

        Footballer*

    55. Barbara Maclean

      Thanks, great info and analysis as always. I love this sport, but now I do feel a little ill...

    56. jabber1990

      I wonder how alot of this works with NASCAR, especially due to all the limited fan capacity and since alot of this information is secret

    57. KRYPTONITE Jules

      Salaries of 40 million dollars? Lewis earns that on his own :)

    58. Matt Dobarsky

      You talk to fast and with a monotone voice. Made me lose interest. Lots of great info but please work on presentation. Thank you.

    59. Big Monke

      Who’s overtake is that at 8:22 ? Kvyat?? Pls lemme know if you know!

    60. NovaScene

      Liberty bought for 4.4 million???? Daaaamn that was cheap, who knew

    61. MrZwulch

      Can you maybe explain the price of $250k for a front wing? I can imagine this price if you consider the design process and engineering behind it. But once this is done, the spare parts shouldnt be as expansive as 250k, right?

    62. Thapelo Sekanka

      Shoutout from South Africa

    63. Solomon Ramakorwane

      Quite fascinating

    64. Ahmad Tarmizi

      What about soccer?

    65. Ben Müller

      9:58 is that Project One ?

    66. TBurianOnline

      New to the channel. I love how every guy I found talking about F1 is British. You guys really love motorsports and I respect it.

    67. Googl Reviews

      In Russia they burn AMG Mercedes cars be ause they are junk lol

    68. Googl Reviews

      The day my tax money go to nonsense like F1 is the day I'll stop claiming my income and stop paying taxes.

    69. Kibido

      what an awesome video

    70. Robert Miller

      Sure I get all of that. I guess my question is farther upstream. Apart from production car manufacturers, _from where_ does a sponsor get the hundreds of millions of dollars it provides to teams either directly or indirectly? These sponsors don't just hand out money out of the kindness of their hearts or because they like the sport - they do it to get a return on that investment in increased revenue. Does it really result in increased revenue to more than cover that outlay and how do they know so as to justify that outlay?

    71. Obito Uchiha

      Didn’t Ferrari pull out of f1 very briefly in the early 80’s or 70’s to put together a working car

    72. Whoopsy

      wow what a waste

    73. John Nyquist

      The most amazing thing about today's F1 racing is that we watch every race on ESPN, without a commercial. How impressive is that?

    74. Layne Patterson

      Thank you for this. Ive always wondered about this!

    75. Gman k

      Controlling the rights to Formula One for only 4.4 million bucks?!! I would a went to my credit union and borrowed the loot holy cow!!!

    76. Matthew Gagliano

      With the amount of front wings getting destroyed almost every race, hearing 250k for ONE made me almost throw up. Mazespin needs to chill

    77. PassatCCR36

      you cant compare soccer shoes with highly developed technology! Football players should earn and value a lot less.

    78. Lulu06 YT

      250K for a single front wing? Scammed

    79. Vincent Fischer

      I want overtake button and DAS for my smart fortwo (technically a mercedes)

    80. Vincent Fischer

      #WeSayNoToMazeSPIN

    81. Tim Sawatzky

      I used to think of Lance Stroll as a pay driver and nothing more, but if we’re being honest, the guy has a few podiums and a pole position under his belt and he’s never driven a top 3 car. Many “talent” drivers can’t say the same. He deserves more respect.

      1. Ukkie sc

        Initially he did not show enough talent to warrant him a "talent driver", but with hard work he has improved a lot. If his dad wasn't insanely rich he never wouldve gotten the opportunity, but I agree with you that he did take full advantage of the opportunity he got. He really did become a very good driver

    82. JP Toutant

      Id like to see the figures on these cities coming up with hundreds of millions worth in one weekend. It has the smell and looks of corruption all over it.

    83. David Smith

      4.4 million 😂😂😂

    84. AF Rules

      In my opinion, its immoral to use tax payer money, to pay F1 millionairs.

    85. Mr. Eric De la Cruz

      Cash is King

    86. Khryss Bourgeois

      Here,in Québec, at Le Grand Prix de Montréal too, our government don't help

    87. Aaron Thomas

      Yeah lance is a paid driver BUT, he's looking decent now a days.

    88. Aaron Thomas

      Ferrari International Assistance

    89. Deejay Mercado

      Alfa Romeo getting into F1 worked. I now own an Alfa.

    90. jono debus

      ThIs is so sad, what those top driver make in an hour is what i roughly made in a month.....and what those driver make in a day is what my parents make in a month......and we still considered above average where i live.....

    91. Southpaw Autoworks

      This is a great video. Lots of interesting data, great presentation, etc. Nice work! Liking, subscribing, and (of course) commenting.

    92. martini668

      Didn't know that Williams also gets an extra payment

    93. Mark K

      Great video !

    94. Stijn De Graaf

      Just lawrence

    95. cheezl

      Alpha Tory lol

    96. Bernard Tremblay

      Great good show!

    97. XantheFIN

      Those drivers wearing company brand clothing.. ah.. feel so bad for them as just look their face. So stoned. I am sorry.

    98. Rushe

      Another great insight, thankyou

    99. Mr. Pudding

      In the old days the teams would sell used parts of their cars at the last race of the year. At the 1982 Las Vegas Grand Prix I bought the side piece of Piquet's Brabham (PARMALAT) and the side piece from Rosberg's Williams (SAUDIA 6). Price? $50 each. These days (Mexico 2015) the teams (Ferrari) would sell $2 plastic pens to the fans for $20. My trackside photographers pass for the 1983 Detroit Grand Prix was $250. My stadium seat for the 2015 Mexican Grand Prix was $650. Bernie pushed the sport to new heights and new heights means more money. All that said, I have greatly enjoyed it all.

    100. Brian Sellers

      This is such a comprehensive and interesting breakdown - thanks!