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Liberty Media Formula One (NASDAQ: FWONK — $27.79b) since acquiring the sport of Formula One in 2016 has effectively begun to breach the American and Middle Eastern markets while strengthening its position in Europe. However, the company has yet to master the largest and by many experts measures the most important market, Asia. Historically, Formula One has had up to 6 Grand Prix in one season in the continent, but recently that number has dwindled to just 2. The company tried to start expansion in Asia with the Hanoi Grand Prix, but the race was cancelled in its inaugural year and never resigned or rescheduled.
However, all hope is not lost for growth in Asia. Now that China is beginning to open up again the Shanghai Grand Prix is on track (pun intended) to return next season. South Korea which has been out of the rotation for a few years now, but is top of the list for a re-entrance into the sport. India hasn’t had a Grand Prix for a while, but it should be the next move for Formula One since it is as good if not better of a market. In any case, breaking into the Chinese and Indian markets are the clear next step for the sport.
Popularity of the sport in China has already begun to accelerate with the signing Zhou Guanyu by Alfa Romeo. Zhou is the first Chinese Formula One driver. We have seen similar influxes of capital from countries where drivers are from when they enter motorsport. For example, Redbull’s Sergio Perez bringing in Mexican sponsors.
Growth of the sport is also beneficial to the regions it expands to. The Singapori government pays 60% of the approximately $100m fee to host the race. They do this because the benefits far out weigh the expense.
Formula One has already begun to lay the ground work for expansion in Asia by negotiating broadcast and streaming deals in Japan, Hong Kong, Singapore, Malaysia, Brunei, Indonesia, Timor-Leste, Thailand, Laos, Cambodia and the Philippines. These deals were made through DAZN and beIN.
Asia expansion is a long-term game that won’t be finished with 1 or maybe even 3 Grand Prix. It will be both a culmination of smart streaming tactics and race additions. The continent has the potential to double or even triple the current viewership and fanbase of the sport, but it is not a change that happens quickly.
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Until Thursday,
Soren
Asia will be a key part for the growth of a lot of company in the next few years. This can be huge for the Formula 1, but this season is weird with all the canceled race. Great read thanks!