Every season without fail for the past few years, a visit to the Autosport International Show in Birmingham has been the scene for my yearly catch-up with Chris Aylett, the CEO of the Motorsport Industry Association.
I first met Chris during a visit to the Rolex 24 at Daytona, when we were both part of the same group of Brits to be flown out as guests of the circuit for the opening event of the Grand Am season.
Every year, we now catch up in January to have a chat about what has – or in some cases – hasn’t changed in the previous twelve months, and its no surprise that the economy has been a regular topic of discussion – given the impact the downturn has had on our industry.
The article below comes from an interview that took place in early 2010 but is just as relevant now as it was then, discussing how the motorsport industry as a whole has done what it can to try and deal with the downturn.
How motorsport battled the recession – Published February 2010
The 2009 season saw F1 teams faced with the prospect of cutting workforces and reducing costs – with the issue leading to high profile bickering between the FIA and FOTA as the sport at times threatened to implode.
However, Formula 1 wasn’t the only area of motorsport faced with the need to cut costs in the face of a recession, with the impending financial crisis leading to many questions about how the industry would cope during 2009.
Twelve months ago during a visit to the Rolex 24 at Daytona in Florida, I sat down to chat with Chris Aylett from the Motorsport Industry Association about what the recession would mean for the sport and a year later, it was time to reflect on what had happened.
“Remarkably well, and better than any of us thought,” he replied recently when questioned on how motorsport had coped. “I go around the world speaking on these things and I think one of the key things is that motorsport is full of lean companies. They are used to laying people off over the winter in between seasons and many of them probably do. What that means first of all is that we went into the recession lean and weren’t carrying a lot of fat, so we didn’t need to shed a lot. I’m taking the F1 teams out of this as they have halved their staff, but because they volunteered to. It’s the perversity of motorsport – in the recession you half your staff even if you don’t have to.
“Other than the F1 guys, people went into the recession lean and flexible and they are small businesses – so are quick to react. If you read the business papers, that’s what companies have to do to deal with a recession, so naturally, we were better equipped. Funnily enough, brands grow big in recession and certain brands gobble up the others and they have to market it. They have bigger budgets to market with and they look for a way to market their product and find motorsport. That is how we have Virgin coming into F1, Santander doubling its investment, so it’s not all bad news. Brands need to market themselves and in the commercial side of things, motorsport is a brand opportunity and we are pretty good value.
“[However] I don’t want motorsport to hold itself up as being anything other than lucky. Motorsport is an optimistic sport, as there are 30 cars on a grid and 29 are optimists – only one is the winner. The following week, they all go back again as they are optimistic that they will win that time. Optimism is a powerful thing to have through a downturn, with the view that it will get better and we are resilient. We go racing week after week and may keep losing, but we keep going back.
“Optimism, resilience, leanness – these are all things that are in our nature. People are writing articles about companies needing to do those things – they just haven’t looked at motorsport and realised that we were lucky and already doing these things. It’s an interesting strength of the industry which I don’t think many people realised, because they didn’t realise what a recession was going to bring.
“It’s a very odd set of circumstances and when we sat there in Florida looking at the year ahead, I didn’t think we would get through as unscathed as we have. Although times are tough, people have worked hard – but then they always did.”
Away from F1, a key way in which motorsport companies battled the economic downturn was to explore other avenues when it came to bringing in money – even if it meant utilising skills in a completely different marketplace.
With British forces currently doing battle in countries like Afghanistan and Iraq, the defence industry has proved to be one area in which motorsport companies have been able to share skills.
A Jackal armoured vehicle held pride of place on the MIA stand during the recent Autosport International show and while it left members of the public wondering exactly what it had to do with motorsport, the truth is, the Jackal – and other machines in the defence industry – have actually had a lot of involvement from racing outfits during their creation.
“A few years ago we recognised that, facing a recession, motorsport has a lot of assets which are underutilised and a lot of talent,” Aylett explained. “One of the things we are good at is that we deliver on time. If you think about it, there has never been a race delayed while they wait for the supply of a part. When the time arrives, those cars are going – there is no second chance. Motorsport is a fantastic user of time and there is this discipline over the years that if you aren’t ready for the start, you are out.
“In defence terms, those guys measure lateness of delivery in death. Make no mistakes about it. If you turn up on the battle field and you haven’t quite finished making the thing, then you are going to die. If we are late, we face losing money and going bust – they face losing their lives.
“We led a bunch of motorsport companies to meet defence companies and see what the synergies were and the ability of motorsport companies to come up with solutions and deliver them on time ready for battle was perfect as it saved money and saved lives. If you think about the Dakar Rally and you watch Afghanistan on TV, they have to get in and out of a battle pretty quickly and there is no better way than with the performance and engineering capabilities of the guys who built desert raid cars.
“Now we have the likes of Lola making underwater vehicles, there are unmanned submarines and unmanned planes which they use when they don’t want to put pilots in to be shot down. If you think about it, an unmanned vehicle is an F1 car. It’s only when they put a driver in it that it messes up the computer. The car arrives at the track as an unmanned vehicle and it knows in its memory how to go round the track fast. The whole car has been built and programmed in the factory so we took that to the defence companies and when they said ‘can you build these things’, the answer was ‘we already do’. We fly them at ground level in motorsport, now we fly them in the air.”
These defence projects have proved to be key to some companies in fighting against the downturn and Aylett said it was an ideal example of how assets can be fully utilised by the industry.
“They have assets they weren’t using properly and now they have spotted it; that you can carry on winning things and pick up this other business as well,” he said. “That should have been done before, but you need something to kick-start it. Maybe the war in Afghanistan and the security of government funding for defence did that.
“It’s secure income if you can get into it and sadly, as long as we keep on attacking and defending people, there will be a business in defence.”