On Sunday morning, CNA (formerly known as Channel NewsAsia) put out a commentary article by John Duerden. Titled, Commentary: Singapore’s hosting of F1 Grand Prix – time to reconsider? Here is my thoughts on the future of the race, & my response to this article.
2021 marks close to 14 years since the Singapore Grand Prix was revived as part of the Formula One calendar. In the span of 14 years, Singapore has hosted 12 races, with the 2020 edition cancelled due to the COVID-19 Pandemic. Singapore’s contract with the Formula One Management ends this year.
Before diving into my response to the article, and thoughts on the future of the race, allow me to explain the origins of the revived Singapore Grand Prix, and the model the race uses.
Origins of Formula 1 in Singapore
On the 11th of May 2007, a press conference was held at the URA Centre Theatrette. Speaking at the event, were Mr Ong Beng Seng, Mr Lim Neo Chian, S Iswaran (then the Minister of State for Trade and Industry), alongside former F1 Supremo Mr Bernie Ecclestone, who appeared via teleconference.
In his opening remarks, the then-Minister of State announced that Singapore would host a Formula One race from the 2008 season. He stated that Singapore GP Pte Ltd, controlled by Mr Ong Beng Seng, had secured the rights for the race for 5 years, with an option for an extension. The Singapore Tourism Board would co-fund the event, providing about 60% of the funds required, with Singapore GP Pte Ltd responsible for the remainder.
STB funding was provided on the basis of the larger economic benefits recognised. The race was expected to generate 100 Million in Tourism receipts alone, while an F1 cess was planned to be levied on hotels. Generating an additional 15-20 Million, to defray staging costs. Outside the tourism industry, other industries were also expected to benefit from the race.
On the 24th of October 2007, the inaugural event received confirmation. The 2008 Formula One World Championship calendar received approval from the FIA, with the event as Round 15, held on the 28th of September 2008.
How the Singapore GP works
While on the surface, the Singapore Grand Prix weekend is a single event, in reality, it isn’t. The weekend itself consists of 2 events, running under a single banner. A race, paired with the associated support series (e.g Porsche Supercup, Ferrari Challenge). Alongside what is effectively a music festival.
This “2 in 1” approach allows the race to gain a higher attendance than it would as simply a race, by catering to a larger demographic. While Formula One may have a large market in Europe & Japan, the same cannot be said for Singapore & much of Asia. Resulting in weak local and regional interest, alongside attendance. As such, an additional incentive must be provided to boost crowd numbers. Hence, the concerts held across the weekend.
My Thoughts on:
In my personal opinion, I find it unlikely that the 2021 edition of the Singapore Grand Prix will be held. With COVID-19 Pandemic continuing to persist worldwide, international leisure travel still faces numerous challenges. With the race intended as a tourism event, this poses a barrier for the race to proceed. Indeed, the race promoters stated in 2020, that holding the race without spectators was an impossible task.
And it is easy to see why. Under the 2017 contract, each edition of the race costs 135 Million Singapore Dollars in hosting fees. Circuit Construction, the installation of barriers and lighting add further costs.
But is there hope of running the race exclusively with local spectators? The odds are slim. Realistically, the majority of local attendees are not there for the race, but for the concerts. With a large amount of movement between the zones for the concerts, the risks of a superspreader event is high, even with pre-event testing. Due to logistical complexities, concerts will also be unlikely to feature International Performers. Will Singaporeans be willing to support their local artistes? That remains to be seen.
Either way, concerns over safe distancing may even result in concerts being axed entirely.
Without concerts, attendance numbers could be a problem. As mentioned earlier, Singapore does not have a large market for Formula One. With potentially increased ticket costs, and no concerts, will local Motorsport fans turn up? It is unlikely. Effectively meaning a cancellation for a second consecutive year.
Will we have a Singapore Grand Prix in the future? I believe we will. But not in 2022, or 2023. A return will only come after the end of the Coronavirus pandemic. With the high costs involved, alongside its nature as a tourism event, the race cannot be run while air travel restrictions remain in place.
Pre-COVID, the race was expected to continue post-2021. In 2019, Senior Minister of State for Trade and Industry, alongside Education, Chee Hong Tat hailed the race as a success. Describing it as a tourism highlight, revealing that it had generated 1.4 Billion in Tourism receipts since 2008.
Beyond tourism receipts, attendance numbers are another metric to determine an event’s success. Attendance numbers for the race have remained stable in recent years. Despite the race losing it’s unique factor, of being the sole F1 night race.
Since 2014, the Bahrain Grand Prix has been held under the lights. While Saudi Arabia joins the roster of night races for the 2021 Season.
With these positive statistics, it is reasonable to believe F1 can return after the pandemic.
Deconstructing the article: Singapore’s hosting of F1 Grand Prix – time to reconsider?
In my deconstruction of this commentary article, I will not be discussing every section of the article. The original article is divided into 6 points. “Show me the money”, “Diminishing returns”, “Hosting this year is inconvenient”, “A wasteful extravagance”, “At odds with the sustainability agenda”, and “How much does Singapore need F1 to be on the world radar”.
I have skipped 3 sections. “Diminishing returns”, “Hosting this year is inconvenient” and a “Wasteful extravagance”. These 3 sections were covered in my opinions regarding the 2021 edition, and the future of the race.
For each of the remaining sections, I have a section dedicated to each section in the original article, and have provided my thoughts, and counterarguments.
SHOW ME THE MONEY
Among the various sections of this commentary, “Show Me The Money” arguably features one of the weakest points in the article for ending the Singapore Grand Prix. In fact, it’s own opening, concerning the Australian Grand Prix, explains why the Singapore Grand Prix exists.
Beyond this, “Show Me The Money” utilises cherry-picked examples to show the “struggle” Asia has faced in Formula One. Conveniently leaving out the recent success of the Chinese Grand Prix, and the true reasons behind the failure of each race. Including a race that Singapore effectively helped to kill…
Below, I explain the reason behind the failure of each race.
But others like Malaysia, the second Asian nation after Japan to host the F1 in 1999, realised it wasn’t worth it.
With attendances declining – hovering 80,000 in 2016 down from a high of 126,690 – and costs staying sky-high, Malaysia cancelled it a year later.Commentary: Singapore’s hosting of F1 Grand Prix – time to reconsider?
The Malaysia Grand Prix, last hosted in 2017, was arguably one of the greatest losses from the Formula One calendar, since Turkey in 2011. The Sepang International Circuit, built specifically for Formula One, was a favourite among fans, drivers and teams.
The track, notorious for unpredictable weather, saw many iconic races and moments. Iconic races include 2001, 2009 and 2012. In all 3 races, rain made for a tricky and tough surface; in 2009, the race was even stopped. While iconic moments include Kimi Raikkonen’s Ice Cream break in 2009, and Multi-21 in 2013.
Race weekend attendance peaked in 2008 at 126,690. From 2009 to 2012, weekend attendance hovered between 97,000 to nearly 120,000. However, attendance plummeted after 2012; before the 2017 edition, the highest recorded was 90,000. In early 2017, Malaysia elected to end the race, due to limited returns and falling interest.
So what caused the drop in attendance, which ultimately killed the Malaysian Grand Prix? The Singapore Grand Prix, and the 2016 calendar. Sepang is a 6-hour drive from Singapore. With the geographical proximity of the races, both races were cannibalising each other’s ticket sales. Fans had a choice between the 2 races to make. Either enjoy the racing action at Sepang, or the glitz and glamour in Singapore. Across the years, seemingly more and more chose the latter. It did not help that MotoGP had a substantially larger fanbase in Malaysia relative to Formula One.
Moving the 2016 edition to October did the race no favours either. A 2-week gap between the 2 races arguably hurt ticket sales, as fans who previously attended both races saw zero point in doing so. And once again, more fans chose the latter.
The sport has had a mixed record in trying to establish itself in Asia with races in South Korea and India lasting just four and three years in the 2010s.Commentary: Singapore’s hosting of F1 Grand Prix – time to reconsider?
While the discontinuation of the Malaysia Grand Prix was a huge loss in the 2010s, the same cannot be said for the Korean Grand Prix. The loss of the Korean Grand Prix was insignificant, relative to Malaysia.
While drivers loved the track (apart from the pitlane), fans felt otherwise. The on-track action ranged from decent to good. But all that was only enjoyable if you were watching it on television. No fan wanted to turn up to the track. And for good reason too.
The location of the track was literally in the middle of nowhere. A 4-hour drive from Seoul, a day trip was untenable. Making matters worse, local accommodation and facilities were minimal. However, this was not the original plan for the circuit. A small city was originally planned to be built around the track. This did not materialise at all, and the area remains barren till today.
Once the many issues at the circuit were factored in, it was clear that the venue was far from attractive for potential spectators. As a result, the circuit struggled to make money. While the 2010 edition reported attendance figures of 168,000, it later emerged that tickets were given out for free. In a bid to boost attendance for 2011, ticket costs were reduced, and discounts were offered. Despite this, the race continued to struggle financially. Loss estimates came in at 50 million, 56 million and 36 million between 2010-2012. 2013 would be the final race, and F1 has not returned to South Korea since.
While the Korean GP appeared on the 2014 Provisional Calendar, it did not appear on the final calendar. The opposite of this happened for 2015, albeit for legal reasons. The race cancelled again in 2015, as organisers did not want to run the event, for understandable reasons.
Indian grand prix
The Indian Grand Prix, like the Korean Grand Prix, failed to last more than 5 years. Being similarly unprofitable to the promoter. However, the reasons for it’s ultimate failure were different.
Unlike the Korean Grand Prix, the race was thought to have a bright future from the beginning. And it wasn’t difficult to see why. The track sat on the outskirts of New Delhi, next to an expressway. A stark contrast from the Korean venue, built in the middle of nowhere. While Korea didn’t have a huge motorsport fanbase, India had a significant amount of Formula 1 fans. Adding to that, there was national representation on the grid. There were Indian drivers racing in Formula One, in Narain Karthikeyan and Karun Chandok, while an Indian team was on the grid.
The first Indian Grand Prix in 2011 saw a strong crowd of 95,000 attendees across the weekend. A good start for the venue, built for 110,000 attendees. However, the 2012 edition saw a sharp drop in numbers, with just 65,000 attendees. Then-F1 supremo Bernie Ecclestone shrugged off the drop in attendance, saying it was normal for the second edition of races. But ahead of the 3rd race, it was clear there was a problem. Days ahead of the race, The Economic Times reported that just 40,000 tickets had been sold.
A lack of marketing did not help the 2013 edition. TV Commercials, and Advertisements were virtually non-exist, as was social media chatter regarding the race. Sponsorship also proved to be a problem. While the race still had Airtel as a title sponsor, there were few additional sponsors. As past sponsors, such as ICICI and Castrol dropped out.
But these weren’t the only factors working against the race. Further complicating matters, was a tax dispute. Despite the circuit’s proximity to New Delhi, the track was in reality, under the state of Uttar Pradesh. The dispute arose after the state government repeatedly refused to classify the race as a sporting event. Instead, they classified it as an entertainment event, which was taxable.
Combined, the three factors were enough to bring a permanent end to the Indian Grand Prix.
AT ODDS WITH SUSTAINABILITY AGENDA
Formula One may indeed be at odds with the sustainability agenda. However, we must look at the issue within the context of the situation. What is the purpose of the Singapore Grand Prix? Is it to showcase that Singapore is a sustainable city? It is not. But it can be done with proper planning.
If Singapore’s goal was to demonstrate sustainability, we would instead be organising a conference on green technologies annually. Similarly, if we wanted a “more sustainable” tourism event, the Singapore Grand Prix would have been replaced by the Singapore ePrix in 2014. Forming one of the rounds of the inaugural FIA Formula E Championship.
The purpose of the Singapore Grand Prix is for tourism. To attract tourists to an event, it must be sanctioned by a major league or series. In the motorsport world, no international series has the same level of recognition as Formula One. Formula E does not come remotely close to Formula 1 in terms of recognition. Without the recognition, it will be a nigh-impossible task to market a sporting event internationally. But how can Singapore use Formula One, a sport notorious for it’s carbon emissions, to showcase a sustainable city?
In late 2019, Formula One announced a 10 year sustainability plan. With the end goal of being Carbon-Neutral. Within this sustainability plan, Formula One seeks to have: “Every race to qualify as an F1
sustainable spectacle by 2025″.
With the COVID-19 pandemic ravaging the world, mass tourism is unlikely within the next year. As such, Formula One is not expected to return to Singapore until 2023 at the earliest, if a new deal is signed. In the span of the next 2 years, the Singapore Government can push out initiatives, encouraging the reduction of use for single-use plastics, and recycling.
When F1 returns, the race can then be used to showcase Singapore’s sustainability efforts. Recycling bins could replace refuse bins on circuit grounds. Concession stands could eliminate, or charge extra for single-use items, with proceeds going to environmental causes. All of this will create positive press for Singapore. While beating the 2025 target, and setting an example for other host cities/venues.
HOW MUCH DOES SINGAPORE NEED F1 TO BE ON WORLD RADAR?
As with “Show me the money”, this point struggles for relevance. Failing to understand the primary purpose of the race.
Favourable tax and business climates have also attracted many of the world’s top business leaders to move here or at least set up family offices in Singapore. That is likely to have more direct influence and impact on Singapore’s economic growth.
Furthermore, since the first Singapore race in 2008, the country has diversified its economy further and brought big-name companies from China, the US and Europe to establish a key regional presence here.
While having the world’s elite congregate here for a weekend of networking does have its attendant benefits, surely Singapore, host to Bloomberg’s New Economy Forum and would-have-been host to the now cancelled World Economic Forum, does not need the F1 to put itself on the radar of the world’s elite anymore.
Home to some of the most recognisable bars and nightclubs in Asia like Regent Hotel’s Manhattan, Parkview Square’s Atlas and Jigger and Pony, that make the annual Asia’s 50 Best Bars, Singapore also arguably no longer needs the F1 race to enliven its image.Commentary: Singapore’s hosting of F1 Grand Prix – time to reconsider?
Does Singapore require F1 to remain on the World Radar? Certainly. For a small nation-state like Singapore, it is major events that allow it to remain in the limelight. The Singapore Grand Prix, is one such event.
Hosting the Grand Prix in Marina Bay is not done without reason. Marina Bay is a district of the Downtown Core. A historical area, arguably one of the flashiest and most developed parts of Singapore. Marina Bay is one of the newer districts, built upon reclaimed land. Many recent iconic developments exist in this area. From the Marina Bay Sands, the Esplanade, to the Singapore Flyer.
With the shiny skyscrapers and modern hotels, it is easily the best place to hold a race with the aim of showing off your country. Projecting an image of sophistication and modernism on live television. Which would in turn, attract tourists and business travellers to the country on any day, for reasons beyond the Grand Prix.