MotoGP is doing great in Malaysia because of local riders. But it's a different story in F1

As SIC hosts the MotoGP this weekend, we should look deeper into what Youth and Sports Minister, Khairy Jamaluddin hinted about not renewing the F1 contract with Formula One Management which expires after the 2018 race. The Sepang International Circuit’s GM, Datuk Razlan Razali, has also said that the F1 has lost its novelty and that holding the races is not commercially viable for SIC, once the only FIA sanctioned F1 circuit in non-Japan Asia. In fact, there is only one issue of motorsports racing at the highest level in the world -- the F1 and the MotoGP – and it is about commercial rights and the sharing of revenues. Assuming that all things remain the same, when we discuss about the high costs of F1, we can say the same thing about MotoGP. Both are not commercially viable for Malaysia which is allowed only the revenue from ticket sales. Both are expensive events and if the objective of the nation is to promote motorsports, then it’s good to discuss whether hosting F1 and MotoGP helps motorsports development in Malayia. When the principals of the race teams come to Malaysia, the local importers and distributors such as Mercedes-Benz Malaysia, Tan Chong/Nissan/Infiniti, Kawasaki and Honda allocate advertising, marketing and promotion budgets to the pre-race events leading up to the race weekend. When promoters of grass root events ask for sponsorship money from the companies involved in F1, they are sadly denied. “When Malaysia held its first World Superbike Championship in Batu Tiga, Shah Alam in 1990, the organisers lost money because of the same thing: commercial rights,” said Ooi Teik Lee, then a senior manager in SAMRA Sdn Bhd, the promoter of the WSBK. “All the branding in the circuit belonged to Dorna. At that time, cigarette companies were allowed to sponsor. Rothmans wanted to support but they declined when they couldn’t put branding on the circuit. They said that they couldn’t recover their investment from sales of cigarettes outside the circuit. “Yoong Yin Fah who was the boss of SAMRA lost money because the ticket sales weren’t enough to cover the costs,” he said. Another motorsports organizer added: “We also have to consider motorsports culture. Does Malaysia have the motorsports culture of say, Italy, or the population size of Brazil and its rocking Rio de Janeiro? Or of the USA where there is a big and rich world of motorsports including NASCAR races?” asked the Malaysian motorsports veteran. The just concluded US F1 in Austin, Texas drew 269,889 spectators over the race weekend and one of the draws was pop star Taylor Swift’s first performance of the year. When Singapore joined the F1 circuit, it was the beginning of the end for Malaysia where Taliban-types imposed their fundamentalist views on entertainment. At that time when Singapore stole the limelight with the first night race in the history of F1, a Mercedes-Benz Malaysia manager asked: “We have a limited budget for F1 promotion and inevitably, the question will be asked: spend in Singapore or Malaysia? We can’t do both,” he said. To see things in the correct perspective, let’s go back to 1999 when Malaysia held its first F1 at the newly built SIC. At that time, oil and gas prices were trending upwards and Petronas was tallying record profits year after year. The Petroleum Development Act established the national oil company Petronas and the Prime Minister’s Office as the sole custodian of Petronas revenues. Flush with oil money, then Prime Minister Tun Dr Mahathir Mohamad, built Putra Jaya and the landmark Kuala Lumpur International Airport, KLIA. To further establish Malaysia on the world map, he asked Petronas to enter F1 and he built the Sepang International Circuit so that the nation could be the first developing country in non-Japan Asia to have an FIA sanctioned F1 circuit. Sixteen years later, Malaysia is well known, Petronas is a world class brand as the lubricant partner of the F1 constructors champion Mercedes-Benz and its champion driver Lewis Hamilton. Today, oil and gas revenues have been slashed by half and there are many more F1 circuits in Asia, including billion-population nations China and India and oil-rich Azerbaijan and the United Arab Emirates. Malaysia has adequately supported F1 and MotoGP and their billion-dollar commercial rights holders, Formula One Management and Dorna, respectively. Yes, it’s time to channel some money back to impoverished domestic Malaysian motorsports. We could do with more local tracks for Penang, Klang Valley, Johore Bahru, Kuantan and Kota Bahru.   If you want to promote Malaysia, there are other ways to do it.