Williams F1 Team Suffers Brutal Sponsorship Loss
Topics: Williams F1
February 27, 2009
The economic strife that has spread across the world has caused problems all across the world of motorsports. The Williams F1 Team just announced a brutal sponsorship loss that the team will have a hard time overcoming.
Williams is a privateer team in Formula One, which is to say that it is not backed by a manufacturer. The team designs its own chassis and buys engines from various suppliers – currently Toyota. Using this formula, no pun intended, the team has won nine championships since its original launch in 1969.
Williams has fallen on some hard times recently from a results perspective as the costs in Formula One have spiraled out of control. Many prognosticators have opined that the Williams team would rebound strongly in 2009. Formula One has take major steps to cut costs and make it possible for private teams to be competitive in the championship. Williams may still be strong this year, but the future is a bit dimmer after an announcement earlier this week.
The Royal Bank of Scotland is one of the prime sponsors of the Williams team. Better known as “RBS”, the inclusion of the word “bank” in the name should have immediately given you a pretty good idea of what has happened. Like other banks around the world, RBS is losing money. In fact, the bank is doing it at a level unseen even in these times. It recently announced a 26 billion dollar loss.
When you lose 26 billion of anything, it is a sign of trouble. Although the sponsorship of Williams is a relatively small amount – roughly 10 million pounds a year – RBS is eliminating the contract. While 10 million might be small for RBS, it is a huge figure for Williams. This is particularly true considering the very real problem of finding a replacement sponsor in such dire economic times.
If there is any hope for Williams, it has to do with timing. RBS did not just cancel the sponsorship outright. Instead, it will continue as sponsor for the 2009 season and then terminate the agreement. This gives Williams some time to come up with a replacement. That is going to be difficult, so we might see Williams go after multiple smaller sponsors to make up the deficit.
Sir Frank Williams, the owner of the team, has stated that the team is solid for the 2009 and 2010 season. After that is anyone’s guess. What is clear is the loss of RBS is a major blow to Williams and the loss of Williams from the grid would be a sad day indeed for Formula One.
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