F1 Canadian Grand Prix in Jeopardy for 2021; Turkey In the Wings

Formula 1 is anxiously waiting an answer this week about whether the Canadian Grand Prix, scheduled for June 13, can go ahead. It is anticipated that if Montreal is canceled, the date will be given to Istanbul Park in Turkey.

Istanbul Park has become a handy go-to replacement venue for Formula 1. The circuit was not on the original schedule for 2020, but was added as races were canceled due to the COVID-19 pandemic. Lewis Hamilton won the race in Istanbul on Nov. 15.

As for Canada, the Canadian race is largely funded by government money from federal, provincial and local levels. These provide around $10 million a year, with the Canadian government believed to pay $5 million, the Quebec province $4 million and the city of Montreal $1 million.

The rest of the money comes from private sources, notably the Tourisme Montréal organization, which is a non-profit entity with around 900 members that promote the city as a tourist destination. This is believed to provide $5 million, while Octane, the race promoter, raises the remaining money required by selling tickets, food and drink and raising money from partners and sponsors. The problem is that if there are no spectators, there is no reason for any of those involved to invest, and Octane cannot raise its share because it will have very limited revenues.

The Canadian media is reporting that Octane has asked the authorities for an additional $5 million in order to balance the books this year, although the promoter is not saying anything publicly. The problem is that with the COVID-19 pandemic, Canada has plenty of other uses for government money.

The Formula 1 Group in London is refusing to reduce the contracted fees, which is not surprising given the losses made last year and the fact that going to Istanbul can provide revenue with lower costs involved.

But that is only part of the problem.

In order for F1 to go to Montreal in 2021, the government will need to adapt its quarantine rules because there is no time in the F1 calendar for a 14-day quarantine as the teams will be racing in Baku on June 6, without spectators, and should then be in Montreal a week later. The Canadian government has made concessions to foreign players in the National Hockey League, but this has still meant that they must spend seven days in isolation and then another seven mixing only with their teammates. That isn’t going to work for Formula 1 and so Canada must decide whether it is willing to hold the event with around 2,000 people arriving from Azerbaijan and leaving again seven days later. That would set a precedent that would upset other groups in Canada wanting to hold events.

Even if a system can be agreed to allow travel in and out of Montreal to happen without lengthy quarantines involved, it is impossible for there to be spectators with the current restrictions in Canada and that means that money must be found if the race is to go ahead.

The Canadian Grand Prix is remarkable in that the city of Montreal attracts far more visitors during the race weekend than actually attend the race. This is because the race marks the start of the short Canadian summer and so it has long been a huge party, with the race being at the center of activities but far more going on, including a large number of graduation ceremonies that happen in the city’s educational establishments in the same period.

The entire city becomes takes on a festival atmosphere and revenues rise significantly, the hotels are filled to capacity and room rates go through the roof, not only because of the demand but also because of a special tax on rooms that weekend to help raise the money to pay for the race.

If the event is canceled for another year, it is not the end of the world as the Montreal contract runs until 2029 and the cancellation can be treated as force majeure.

“The important thing for me is that the Formula 1 Grand Prix of Canada in Montreal stays here,” Montreal’s mayor Valérie Plante told the La Presse newspaper. “If it wasn’t possible for this year, it absolutely has to be here next year, because we care. But with taxpayers’ money, you have to make sure it’s spent the right way. We are in discussions with the Government of Quebec and the federal government to see what the situation is. But we want the Montreal Grand Prix to take place in Montreal.”

Many of those who would be attending in 2021 bought tickets for the 2020 race. This was canceled and although some are happy to use the tickets this year others have requested refunds and there are a number of reports suggesting that Octane has not thus far refunded all the ticket-holders don’t want to attend the 2021 race.

A decision is expected by April 16.

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