Gulf F1 investment fuels debate over states’ growing influence
This year’s football World Cup in Qatar may generate more headlines, but the Gulf region has also quietly amassed a central role in the calendar, staging and economics of Formula One racing.
Widely seen as the pinnacle of motorsport, F1 is gaining prominence in a region that is rapidly establishing itself as a hub for sports and entertainment. The Gulf’s growing influence — made possible by oil and gas-dependent economies pivoting to new sectors such as tourism, technology and renewables — is visible throughout the sport, from racing circuits to team ownership and lucrative sponsorships.
Qatar will next year rejoin a race calendar already bookended by Bahrain, Saudi Arabia and Abu Dhabi. And some of the sport’s biggest sponsors now hail from a region that helped F1 increase its “primary” revenues by more than $300mn to $1.5bn in the first nine months of 2022 year on year. Among them is Saudi state oil group Aramco.
Under the direction of Liberty Media, which acquired F1 in an $8bn deal in 2017, the sport has continued its expansion outside its traditional European home markets, with Netflix’s Drive to Survive documentary series credited with increasing interest in the US. But, in addition to adding races in Miami and Las Vegas, Liberty has signed up new events in Saudi Arabia and Qatar.
The Middle East is viewed by F1 as a “huge growth market”, says Chloe Targett-Adams, global director of race promotion for the race series. “There’s an amazing demographic and fan base there,” she says. “We’re seeing the fan base getting younger . . . we’re seeing more women, which is reflective of that wider shift for F1.” The region’s influence extends to the senior governance level, after Emirati former rally driver Mohammed Ben Sulayem won last year’s election to replace Frenchman Jean Todt as head of the Fédération Internationale de l’Automobile (FIA), the motorsport’s governing body.
The growing popularity of F1 is already changing local attitudes. Ben Sulayem says that karting — the established gateway for young drivers to F1 — has usurped rally driving in the Middle East and north Africa as young people try to climb the “challenging ladder” to the grid. “Without question, the Abu Dhabi GP is the biggest sporting event in my country,” he says.
The FIA president’s home race at the Yas Marina Circuit was, however, also the setting for one of the most infamous moments in F1 history, when Mercedes driver Lewis Hamilton lost the 2021 drivers’ championship to Red Bull’s Max Verstappen in controversial circumstances on the final day of the season. More than 108mn people watched the race around the world, an increase of 29 per cent on the prior year.
While the refereeing error — which was made under the prior FIA regime — could have happened anywhere, F1’s burgeoning ties to the Middle East have also exposed the sport to geopolitical strife — for instance, when a Houthi missile attack struck an Aramco distribution facility as F1 drivers prepared to race in Jeddah this March.
Seven-time F1 champion Hamilton has repeatedly raised concerns about human rights in the region, too — including at the inaugural Jeddah GP in 2021, when he said he did not “feel comfortable” racing in Saudi Arabia.
“The weight of change really needs to be put on the governments and those that are in power,” Hamilton said in Bahrain this year. “That’s why we’ve got to continue to utilise the platforms we have when we arrive in these countries as well, make sure we’re holding serious conversations about what is happening there.”
However, Simon Chadwick, professor of sport and geopolitical economy at Skema Business School in Paris, says that to see investment by Saudi Arabia and other Gulf states solely as ‘sportswashing’ is short-sighted and risks undermining any future policy responses to matters such as their increasing presence in the industry. “We could even categorise their engagement with F1 as soft power. They’re trying to demonstrate to the world they’ve got the money, that they’re affluent,” he says.
Although human rights activists often accuse the Gulf states of sportswashing their human rights abuses, there is arguably less noise around F1 than around football and golf — and the region’s wider appetite for motorsport is not a recent trend.
“I have always believed in sport as a catalyst of progress in society and I think sport is a powerful tool for good,” says Ben Sulayem. “Motorsport has always been in the top three sports in this region, as cars are a big part of our society and culture here.”
The game changer for F1, however, was the first Bahrain GP in 2004, when F1 supremo Bernie Ecclestone still ran the series. That paved the way for the likes of Abu Dhabi to follow in 2009.
The Middle East has “helped raise the bar for what facilities look like in F1,” says Zak Brown, chief executive of McLaren Racing, which has long been part owned by the Bahraini sovereign wealth fund, Mumtalakat. The Saudi Public Investment Fund also became a shareholder in the McLaren Group in 2021.
“Bahrain was there first, so they helped start the movement and excitement — the popularity of F1 in the Middle East,” says Brown. “It’s the first race of the year and the [F1 pre-season] testing takes place there. We’ve got the World Cup coming to Qatar this year, but F1 has led the way on global sports in the Middle East.”
The focus for promoters in the Gulf, as elsewhere around the world, is on developing business ties between local and global companies. F1 is proven as a highly effective platform for networking and business development, not to mention a powerful shop window, given its vast media reach.
“More and more companies are now wanting to take a look at how they can invest in F1, both in terms of branding and using it as a business networking platform,” says Saudi GP chief Martin Whitaker.
“Whilst it doesn’t see a direct revenue flow from business networking, it nevertheless creates the interest in business using F1 as a platform,” he explains.
While the influence of the Gulf region on F1 is significant, for now, the growth is likely to be capped, with no further venues added. Targett-Adams and her team are focused on finding a hosting venue in Africa. “For me, four [races] feels like the right number,” she says. “We have only got so much space on our calendar. I really feel we must race on each continent. So Africa is part of that. Africa is a huge goal.”