Hockenheim for sale? Nearly bankrupt UPDATE #4 After first reporting Hockenheim's financial concerns nearly three weeks ago, we can now reveal that the German grand prix is likely to be saved by the local state of Baden-Wurttemberg.
The German 'SID' news agency quoted Hockenheim mayor Dieter Gummer, also chairman of the Hockenheimring, as saying that he was hopeful for the state's 'commitment' in helping to stave off bankruptcy.
He added that Hockenheim is missing just under $2m in annual income. ''That is our current problem,'' Gummer explained. An Ernst & Young advisory, meanwhile, said the circuit would run out of cash around April 2006.
With the state's assistance, Gummer vowed to change the F1 track's name to 'Hockenheimring Baden-Wurttemberg'.
''At the moment, I assume that the German grand prix will go ahead as planned in 2006, 2007 and 2008,'' he added.12/27/05 The cost of hosting Formula 1 races is a nice little earner for Formula One Management, bringing in around $200m a year, with many of the contracts featuring clauses which increase the cost of the fees by 10% a year. Circuits are pressured into signing such deals because they do not want to lose the races but, increasingly, they are not able to make enough money to run operations in profit. Spa has been losing money for years while Magny-Cours has slashed prices in an effort to pull in more people. Australia, Malaysia and such races all lose money but the local government pays the difference. Grandprix.com 12/26/05 F1 has bankrupted yet another race promoter. The German grand prix has been thrown into serious doubt with news that the Hockenheim circuit is nearly broke.
Major national daily 'Bild' reported in its Christmas edition that chartered accountant firm 'Ernst & Young' have advised that - even in the short term - the circuit in south western Germany does not have the means to sustain track operations.
The recently reported lease buy-back of part of the venue has apparently only postponed bankruptcy for mere months. By the time of the July 30 grand prix, Hockenheim will be in dire trouble.
Worse still, 'the politicians do not want to help,' the 'paper wrote. 12/26/05 Following news that Hockenheim had been put up for sale, it is suggested last week that the German grand prix has now been saved.
A lack of funds will be made up by the partial sale of the redeveloped Hockenheimring in south western Germany, home of the country's F1 race.
According to reports in Germany, much of the new part of the circuit - redeveloped in 2001 and 2002 into a Hermann Tilke design - and the Mercedes-Benz grandstand, are on the verge of being sold to a leasing company. The F1 promoter will then rent the venue year-on-year.
A final contract is expected to be signed by the end of January '06.
According to the initial reports of about a month ago, the plan was to sell the circuit for around $30m and rent it for $2m a year.
12/08/05 According to a whisper in formula one circles, Hockenheim - home of the annual German GP - is for sale.
It is rumored that the circuit's owners, who totally redeveloped the site in 2002 with Hermann Tilke, are seeking around $30 million from an investor for the track.
The idea, according to speculation, is that the new owner will then lease Hockenheimring to the F1 promoter for about $2m per year. The circuit's current contract with Bernie Ecclestone for the grand prix reportedly extends until 2008.