How does motorsport actually make money?

[Quartz]

For the vast bulk of races I see very few spectators. So advertising must be cheap. Presumably the circuits charge the drivers & teams for the privilege of racing most of the time. But from where does the rest of the money come?

 

[mid_gen]

For the vast bulk of races I see very few spectators. So advertising must be cheap. Presumably the circuits charge the drivers & teams for the privilege of racing most of the time. But from where does the rest of the money come?

People with money pouring it down the drain for the pleasure of watching/driving/messing with race cars. I don’t think anyone is in it for the money.

Although my mate that started at an F1 team recently is on surprisingly good money!

 

[ttaskmaster]

Race circuits and their governments actually pay millions to host high profile races.
Then you have the media exclusivities, merchandising, hospitality packages, sponsorship, and having every inch of the track, stalls, cars and drivers covered with expensive brand advertising...

 

[Quartz]

Then you have the media exclusivities, merchandising, hospitality packages, sponsorship, and having every inch of the track, stalls, cars and drivers covered with expensive brand advertising...

But outside the flagship races there are precious few people to see the advertising or to purchase stuff.

 

[GravyMonster]

"If you want to be a millionaire, start with a billion dollars and launch an F1 team".

Presumably the circuits charge the drivers & teams for the privilege of racing most of the time

In lower categories the series organisers get paid by the teams, who get paid by the drivers, who get paid by their personal sponsors. The organisers then pay the circuits and maybe even get TV/online streaming coverage. Do well in the races and the team will get paid prize money as pooled by the race organiser, but normally this is only a fraction of their operating costs, the rest made up from sponsors.

As an example a streamer I watch occasionally, BasicOllie, has been doing the EnduroKa championship, which races 10+ year old Ford Ka at a few circuits around the UK. The whole season has cost him personally around £10k in race fees to the team, damages and licenses etc. Multiply that out by 50 teams taking part (although not all of them are for the full season)

 

[JRS]

"If you want to be a millionaire, start with a billion dollars and launch an F1 team".

Yep. Or the related "how d'you make a small fortune out of Grand Prix racing? Start with a large one".

 

[deviation]

I mean, it's pretty simple, you just smuggle drugs using the race truck like BMW did in the 90's:

The 1990s BMW Touring Car Team That Got Busted Smuggling Cocaine - Jalopnik

Vic Lee Motorsport was the most infamous teams in the British Touring Car Championship in the early 1990s. But Vic Lee himself had a little problem: sharing room with the race cars in his team’s haulers was a whole lot of cocaine. What’s poetic is what tipped off the authorities: the team’s...

www.jalopnik.com

 

[Mr Jack]

"If you want to be a millionaire, start with a billion dollars and launch an F1 team".

This was true in the past, but in the DtS era with a cost-cap, F1 is actually highly profitable. This quite a change from a time when teams that were financially viable were only so because they were essentially advertising for the brands behind them -- e.g. Ferrari selling cars off the back of their F1 reputation -- and the loses were small enough that this made pretty good sense.