Sports governance is always complicated. Regulators have to consider everything – safety, competitiveness, logistics, technology – and still the sport has to be watchable and entertaining for fans. Motorsport is possibly the most complex sport to regulate and each year new challenges arise which governing bodies have to deal with. There are few other sports where the stakes are so high. Weighing up the danger, with the vast sums of money invested, whilst still keeping fans on the edge of their seats – surely no one in their right mind would want that job? Meet Andrew Coe – Andrew is a lead tutor on our Business of Motorsport Master’s Degree. Andrew has spent most of his career doing exactly that! In this week’s Tutor Talk, Andrew looks at balance between regulation and commerce in the world of motorsport.
From 2001 until 2014 Andrew was Chief Executive of the commercial arm of the governing body of UK motorsport, The Motor Sport Association – now Motorsport UK – and held responsibility for teams delivering some of the UK’s largest annual motorsport events including the F1 British Grand Prix, Wales Rally GB (the UK round of the FIA World Rally Championship), as well as many classic car events and the London to Brighton Veteran Car Run.
The Sport of Kings
The first of the modules for which I have the privilege of acting as tutor to the NMA Business of Motorsport programme, covers the history, the governance and commercial structures which aim to provide the regulatory framework to, arguably, one of the most commercial group of activities within the world of sport.
From the earliest days of the development of the automobile the temptation to race provided the ultimate incentive to entrepreneurs, adventurers and visionary industrialists of the era. The drive to innovate and to improve the performance of their early vehicles was as strong as was already the case within the already long-established horse racing industry. It was perhaps natural then, that the original motor racing rules and terminology were inspired by the “Sport of Kings” and based around the noble animal which early automobiles were designed to replace.
Over 120 years later and the objectives of this early form of motoring competition are still recognisable and relevant today. Performance, whether measured by speed, reliability, operating range, driver convenience and safety, etc. all of these features (and more) contribute to the customer appeal of a vehicle, and will assist in determining the marketing and engineering hierarchy of the brand. The simple formula has always been that a winning brand is a brand which sells. Naturally, a sensible competitor would only be prepared to take the risk of entering a sporting competition when the principle of competing on the proverbial “level playing field” was established and the rules of engagement well understood. This principle is key to the credibility and to the success of all forms of sporting competition. Rules were introduced from the earliest days of motor racing and with the international nature of vehicle manufacturing the requirement for rules which applied equally across national borders became fundamental to the development and success of motor sports as we know them today.
The Evolution of Motorsport Governance
The evolution of the current structure for the governance of most forms of four-wheel motorsport is documented within the Business of Motorsport programme. The Federation Internationale de l’Automobile has fulfilled its mission as the global role as the governing body since its inception in 1904. Whilst the origins of the governance role performed by the FIA can be traced back to the need to create a platform for fair play amongst sporting participants, whilst ensuring that the commercial interests of pioneering vehicle producers did not result in an unfair technical advantage, it is unlikely that those responsible for creating the early governance structures could have anticipated the extent to which modern technology now influences the regulatory process.
Managing the regulations for highly innovative versions of motor sports, of which Formula 1 is still the pinnacle, whilst safeguarding the interests of drivers and officials safety, spectators and wider audiences and balancing these against the interests of commercial stakeholders, has become a challenge which is exposing the FIA to increasing scrutiny and criticism.
All this comes at a time when motorsport is facing the most fundamental evolution in its history – the move away from the internal combustion engine and, driven by the politics of climate change and market demand, towards more eco-friendly forms of drive train technology. Motorsport may, yet again, play its now familiar role in helping to persuade the public of the credibility and appeal of this new technology. Governance of the motorsport activity is likely to play the same crucial role as it did in the early 20th century, over the coming decade.
The Rise of E-Sports
An equally challenging situation faces the future growth of motorsport with the onset of e-sports. Increasing participation in a sport which has traditionally been reserved for those in society with the means to pay to take part, has always been a challenge. The rapid development of e-sports provides a unique opportunity for motorsport governing bodies to embrace this trend and to expand the pathways for entry into the sport in new and innovative ways. The alternative is to ignore such an opportunity and perhaps face increasing competition from a new form of virtual racing. E-sports are already attracting investment from vehicle manufacturers and sponsors whose natural territory might have been actual physical motorsport. This will not be unnoticed by the existing organisations with responsibility for the growth of the sport, but, what do they do about it? The financial rewards for successful e-sports participants are already substantial with the 2021 F1 Esports series boasting a prize pool of $750,000. Traditional models carried out by national governing bodies and designed to deliver and assist with the development of new drivers cannot currently match such investments and a coherent integration of such initiatives will be required to ensure the best outcomes for growth.
The Big Disconnect
The most recent examples of a growing disconnect between the FIA and the sport it governs has been seen in the 2021 Abu Dhabi Grand Prix and the way in which the rules pertaining to the deployment of a safety car were enacted by the FIA executive. Moreover, the F1 teams appear to be increasingly at odds with the new FIA management over regulations relating to drivers wearing body jewellery during races, which would appear to be contrary to long-established safety protocols.
These issues may be indicative of a growing dissatisfaction with the sport-political control which international federations have traditionally exercised over their sports. The creation of rival series, or athlete representative bodies with commercial and sporting rights falling outside of the scope or influence of the established governance structure has arisen in other global sports such as tennis and golf. Fragmentation of control within sports can confuse fans and lead to damage to the sports appeal.
The next 5-10 years may see some of the most significant changes to the way in which motorsports develop than at any time during the past 120 years. Those responsible for managing this change will need to be able to draw on an extraordinary mix of vision and experience to ensure that the 120-year motorsport success story continues!