Last Updated on September 26 2024, 3:15 am

Formula One is skating on thin ice in its new found USA playground. For decades former F1 supremo Bernie Ecclestone was desperate to crack the US but debacles including the six car race at the Indianapolis Speedway made it difficult for the sport to penetrate a market dominated by NASCAR.

Now under the new ownership of Liberty Media, F1 has three USA based races with the latest in Vegas being promoted by FOM (Operating company owned by Liberty  Media itself. An investment of $500m saw the company buy an entire block just one street back from the famous strip and develop permanent facilities including the pitlane garages and the largest capacity start/finsih straight and first corner grandstands in a deal that will last for ten years.

F1 offered to race each year on there weekend which Las Vegas receives the smallest receipts from its hotels and casino’s and there numbers from the inaugural event last year were eye watering.

 

 

 

Liberty boss insults Mario Andretti

The hotels, casino’s and restaurants reported income some three times larger than when the city hosted this year’s Super Bowl which has in some way gone to placate the residents of the city who suffered a four month upheaval while the F1 infrastructure was built around the circuit.

In a parallel storyline, the FIA accepted the Andretti Racing Organisation’s proposal to create an eleventh team for 2026. Yet Liberty Media and the teams kicked the can down the road telling Andretti to come back when they have a power unit manufacturer ready to supply their cars.

Yet Liberty Media have now fallen foul of the US authorities which threatens its future in the country.  At the Miami Grand Prix, Liberty’s CEO approached legendary F1 driver Mario Andretti while he was talking to F1’s supremo, Stefano Domencali.

Andretti reported to CBS, “Greg Maffei, Mr. Maffei, broke in the conversation and he said: ‘Mario, I want to tell you that I will do everything in my power to see that Michael [Andretti] never enters Formula 1’.”

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US Senators complain to Justice Department F1 is anti-competitive

Preceding this Mario had been reportedly seen on Capitol Hill and following his visit a number of US senators wrote to the Justice Department requesting they investigate a possible breach of US anti-trust legislation. The rejection of the Andretti proposal was cited as a possible breach of anticompetitive corporate actions and the US Justice department produced a list off questions they required Liberty Media to answer.

“It is possible that such a refusal to deal – especially if orchestrated through a group boycott – could violate U.S. antitrust laws,” the senators wrote.

“Last year, F1 hosted three races in America, in Miami, Las Vegas, and Austin, while no other country hosted more than a single race,” they added. “Clearly there is a financial incentive to adding an American team to F1’s roster, and there is no reason they should be blocked unless [Formula 1 management] is trying to insulate its current partners from competition.”

It appears Maffei’s insult to one of the greatest ever and much loved drivers in global motorsport was driven by his visit to Capitol Hill and the subsequent investigation launched at the request of the group of Senator’s.

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Liberty defensive over investigation

Andretti later has clarified that he “did not initiate” the approach to the Capitol, with him being invited to appear to explain the situation following a recent Red Bull F1 show run.

F1’s share price took something of a hit following the news of the impending investigation and Greg Maffei was defiant when on a call to shareholders discussing the company’s quarterly results.

“We intend to fully cooperate with that investigation, including any related requests for information,” Maffei said.“We believe our determination—F1’s determination—was in compliance with all applicable US antitrust laws, and we’ve detailed the rationale for our decision, vis-a-vis Andretti, in prior statements.”

Maffei went on to claim Liberty Media “are certainly not against the idea that any expansion is wrong. There is a methodology for expansion that requires approval of the FIA and the F1, and both groups have to find the criteria met.

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F1 sponsor faces US litigation

“We’re certainly open to new entrants making applications and potentially being approved if those requirements are met.” Yet the proof of the pudding currently suggests otherwise.

The findings of the US Justice investigation have not been made public yet, though there is concern amongst Liberty executives that a ruling against them could open a whole can of worms. It could yet be the case they decide admitting Andretti is the lesser of two evils, but its the current ten F1 teams they will have to persuade.

Ominously, now the US Justice department has filed a lawsuit against F1 sponsor Visa App Cash. Attorney General Merrick Garland outlined the DOJ’s case against Visa, stating, as quoted by Racing News 365: “[Visa] deploys a web of unlawful, anticompetitive agreements to penalise merchants and banks for using competing payment networks.

“At the same time, it coerces would-be market entrants into unlawful agreements not to compete by threatening high fees if they do not cooperate and promising big payoffs if they do. The result is a debit market where Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market.”

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F1 position ‘indefensible’

The lawsuit cites sections 1 & 2 of the Sherman Anti-Trust Act which prohibits the restrain of trade. The DOJ claims its findings reveal that VISA has created a network of illicit agreements to penalise merchants who opt for a different payment offering to their own.

This is “monopolistic behaviour” says the DOJ which has allowed VISA to charge exorbitant fees which exceed what a truly competitive market would allow.

Visa Cash App are the title sponsors for the RB (previously AlphaTauri) team from 2024 onwards. The team is currently in sixth place but sits just three points ahead of rivals Haas F1.

Any judgement against the financial services company will be of a concern for F1, given they are next in line for a US Justice department decision. VCARB are currently pondering whether to retain or let go Daniel Ricciardo after the current there week break from racing, yet Ricciardo could yet replace Sergio Perez who is costing Red Bull the constructors’ title this year.

Rosberg insight into latest Horner/Wolff row

 

 

 

Three men charged over Schumacher blackmail

In a significant development, prosecutors in Wuppertal, Germany, have formally charged three men in connection with an attempted blackmail of the family of legendary Formula One driver Michael Schumacher. The charges, unveiled on Wednesday, highlight the sinister efforts to extort millions of euros from the Schumacher family by illegal means.

The case, which has attracted widespread media attention because of Schumacher’s fame and the deeply personal nature of the crime, centres on a former Schumacher family security guard who is accused of illegally copying sensitive files and passing them on to a third party.

The plot is said to have included a subsequent attempt to demand a large sum of money in exchange for not releasing this confidential information… READ MORE