The Grand Prix of Saudi Arabia is off to a shaky start. On Friday, Yemeni rebels blew up an oil depot 11 kilometers from the race track in Jeddah—minutes before the second practice session was set to begin. After assurances from government security forces, F1 leadership decided to go ahead with the race weekend as scheduled. Then Mercedes star Lewis Hamilton was knocked out in the first qualifier and Haas star Mick Schumacher withdrew with an injury following a scary crash in the second qualifier.
The steady drip of unfortunate events took some luster off what is otherwise shaping up to be a stellar season, at least if audience growth and sponsorship dollars are any indicators.
For 2022, top teams Mercedes and Red Bull are expected to generate $190.5 million from title sponsorships, according to GlobalData analysts. Mercedes retained its partnership with Petronas, the Malaysian oil and gas company, while Red Bull has signed a new deal with Oracle—its first title sponsor since 2018.
“The deal with Oracle offers substantial revenue for the team and is a testament to how far the sport has come in the American market recently,” said Jake Kemp, an analyst with GlobalData. “Oracle has a limited sports sponsorship portfolio linked primarily with U.S.-based properties, such as the Golden State Warriors, the Indian Wells tennis tournament, and Team USA at the America’s Cup.”
For the year, 60% of the teams boast an official title partner, which is the most lucrative offering available, and the total estimated value of title sponsorship deals signed with F1 is likely to be “in the region $326.5 million,” said Conrad Wiacek, Global Data’s head of sports. “In 2020, this figure was $272 million, and in 2021 this was $230.5 million, which was due to COVID-19’s impact on the sport.”
Not every teams has been so fortunate with its title sponsorships. Ferrari ended its 38-season affiliation with Phillip Morris and Haas terminated its Uralkali backing after the Russian invasion of Ukraine. Ferrari has since signed other major sponsorship agreements with Spanish bank Santander, software giant Qualcomm and Swiss-based blockchain company Velas Network AG to fill the $160 million-a-year hole left by Phillip Morris.
F1’s combined team sponsor income, including all sponsorships beyond title deals, will be worth an estimated $961.25 million. Eight out of 10 teams have a cryptocurrency- or NFT-related partnership, and Red Bull’s contract with Bybit, reportedly worth $150 million, is among the most lucrative. And Oracle is not the only U.S.-based company getting involved. A week before the new season started in Bahrain, McLaren announced a multi-year partnership with Google.
Not to be left out of the action, Formula One itself signed a $100 million agreement with Crypto.com, and the company was recently announced as the title sponsor of the new Miami Grand Prix. F1 is also about to sign a 30-year deal with Salesforce, according to Sky News, and it’s expected to confirm a second U.S. race in the near future.
Wiacek said the sport’s growing popularity in the U.S. relates to the success of Netflix’s Drive to Survive. “What the series really does is bring the sport in front of new fans,” said Ian Holmes, director of media rights of F1. According to F1, the 2021 season finale in Abu Dhabi had a 108.7 million TV viewers, 29% higher than the same race in 2020 and higher than the Superbowl globally.
Formula One’s surging popularity goes beyond couches across America. Last season’s three Grands Prix (COTA, Mexico City and British Grand Prix) saw weekend attendance spike past 350,000 spectators, coming in at 400,000, 371,000 and 356,000, respectively. If the circuit can avoid further troubles, that’s a powerful base to build from.