It’s the season of loud engines roaring through the tracks of the F1 Grand Prix again and with it the prestige and privilege of hosting such a monumental race, which is beloved by fans all over the globe. This is an opportunity for some serious discussion about its benefits and drawbacks.
Two years after the 2017 race held in Malaysia’s famed Sepang Circuit, Prime Minister Dr Mahathir Mohamad has expressed enthusiasm for hosting it again. Attending a function in Kuala Lumpur last month, he said Malaysia was in serious contention to bring back the Grand Prix to the Sepang Circuit. However, he was not certain whether it was going to be next year or the year after.
Mahathir purports that Malaysia’s interest in the Grand Prix is still strong, and that the race has not only stimulated Malaysians to go into the automotive industry and encouraged locals to purchase all kinds of new cars, but also boosts the tourism industry which is Malaysia’s pride and joy.
He supports his argument by saying that, “by having the Grand Prix, we will be able to get spectators, more than 100,000, and that will be worthwhile for us. And when the television stations show the race all over the world, something like 200 million people watch the Grand Prix, which is a good advertisement for Malaysia”.
If it happens, Malaysian F1 fans can finally stop shivering in anticipation, and witness the high adrenaline and deafening sport again right here in Malaysia instead of having to travel to Singapore.
It is believed that Malaysia will get a marketing boost of 200 million spectators, who will be watching from all over the world, including those live streaming online.
The tourism sector is expected to benefit the most. The prime minister has said that by 2020, Malaysia would have 30 million visitors to the country. Thus, theoretically, by bringing F1 back to Malaysia, our economy will get a huge boost.
However, dissenting voices are calling for a reality check on the prime minister’s aspiration.
Sepang International Circuit CEO Razlan Razali has voiced concern regarding this, especially since the country is supposed to take a break from hosting the sport.
He claims that “we still have to maintain the fact that Malaysia is still taking a break from the previous race and is currently recuperating for the next five years.
“It is not as simple as wanting to do it next year and things will materialise the way Tun M imagines it to be.
“Such a monumental and time-consuming race requires more than just enthusiasm, a lot more thought is required to be put in, some studies to be done.”
He also said that “we need to know where it (the sport) is right now, how interesting it is and, most of all, how much it’s going to cost”.
Journalist Christian Sylt, writing in The Independent of May 11, said “viewers have been turning off in Brazil and Italy, which are home to the sport’s two largest TV audiences. F1 has lost viewers in Italy due to pay-TV channel Sky Italia becoming the exclusive broadcaster this year while interest has softened in Brazil as its local hero Felipe Massa retired at the end of last year”.
There is an obvious decline in the sport’s popularity. The seats needed to occupy the stadiums are no longer purchased and audiences do not feel compelled to experience the sport in person.
In 2016, the SIC Grand Prix only sold 60% of its tickets despite the race being moved to the second half of the year. The Malaysian Grand Prix organisers cited a decline in ticket sales, viewership and tourist numbers for their decision to pull the plug on a race that first made its appearance in 1999.
In a Business Insider article on April 22, 2019, the prime minister was reported as saying Malaysia would benefit greatly from hosting the Grand Prix again — due to the viewership and advertisement that the country would receive. Has he taken into account the country’s financial situation?
In 2017, former prime minister Najib Razak made the decision to terminate hosting the sport from 2018 onwards, citing the decline in returns as the primary reason.
The public has also voiced its disagreement, commenting on issues such as Malaysia’s RM1 trillion debt as well as how the majority of the population does not watch F1 and cannot afford tickets.
Even former youth and sports minister Khairy Jamaluddin said: “The cost to host F1 is more than RM200 million annually, with almost all borne by the government. You (the government) say that we do not have money, hence we must be prudent. Allowances for national athletes also are being cut and sports science staff did not get their contracts renewed.
“Yet, you still want to have F1 again. So, no to the F1.”
It is believed that in 2016, the annual race-hosting fee cost nothing less than US$33 million (RM135.30 million).
If this is really something the new government wants to introduce, then it will need to find ways to attract more foreign tourists. The expectation is that it will boost not only the ticket sales of the Grand Prix, but the hotel, retail and airline industries. This is due to the foreigners’ higher spending power compared with that of the locals.
Others want to host F1
However, since 1999, Malaysia is no longer the only country outside of Japan to host the Grand Prix. Other countries such as Abu Dhabi and Bahrain in the Middle East, and China and Singapore in East Asia are jumping on the bandwagon.
Tourist numbers will migrate to these other countries since we are no longer the sole host. Incidentally, 2020 is the year Vietnam will host its first F1 street circuit in Hanoi.
In conclusion, as prestigious and exciting as we may think hosting the F1 Grand Prix is, the fact of the matter is, we have to consider first and foremost our own capabilities to not only uphold the standard of the F1 Grand Prix but also to satisfy the fans’ expectations.
Hence, when comparing between the actual cost and the opportunity cost of hosting the F1 Grand Prix, which includes the consideration of (1) the country’s debt, (2) the cost of hosting the event, (3) the decline in F1’s viewership, and (4) other host competitors, it is obvious that this is escapism from actually tackling our own nation’s political problems.
Pakatan Harapan believes that our involvement in the sport is able to benefit Malaysia by giving it greater publicity in a refreshing and invigorating manner.
But the truth is, in the face of Malaysia’s current political situation, taking on this multi-million project, while still in a trillion ringgit debt, will paint the government as short-sighted and immature, only hoping to distract from real issues with fancy fast cars.
Afnan ‘Aqif is a Research Associate at EMIR Research (www.emirresearch.com), a think tank focused on data-driven policy research, centred around principles of engagement, moderation, innovation and rigour.