Finding answers to questions to how to fund the World Championship paddock is impossible. As soon as the word “money” is mentioned, all mouths immediately close; but clearly there is somebody who pays for the “party”.
There have been always “rich and poor” and MotoGP world is not en exception. Therefore the difference in budget between “big” and “small” teams in motorcycling top category is significant. While a team from the second half of the grid makes a World Championship of 19 races—7 of them outside Europe—for around 8 million euros, the factory teams are usually around 30 million per season … Well, 30 million and up. Actually, “and up” means you can almost triple this number.
Use the cost of the riders as a reference. It’s true that in MotoGP there is no salary cap like the North American NBA has for example, but somehow it is still kind of present. Let’s use Ducati as an example. The self-imposed “salary cap” at the moment is around 15 million euros, which is what it must have cost the Bologna factory last year for its pair of riders. More or less that should be what both Yamaha and Honda pay for their riders. This number is for the MotoGP elite.
The difference in budget between “big” and “small” teams in motorcycling top category is significant. While a team from the second half of the grid makes a World Championship for around 8 million euros, the factory teams are usually 30 million and up.
The difference between “small and large” not only applies to the finances behind the latter group, but also because it is up to these to manufacture all the material that will be used over the course of the year. For example, while a team like Team Avintia is allotted only what it will use over the year, the factories still have to pay for the manufacture of the engines, spare parts and components that they will use on their official bike as well as the satellite teams.
The official teams also move a lot of people. A second-line team takes around 20 people to a pre-season test; an official team takes no fewer than thirty. At the European races they are joined by the hospitality staff, which means a dozen more people.
Race material, travel, personnel, communications, events, public relations, promotions, guests … all this costs money and someone has to pay the bills to cover the huge cost involved in taking part in MotoGP. Let’s try to find out how this party is paid for.
The first source of financing is different if we are talking about a factory or non-factory team; while an official team is a cost, private teams are income.
The first source of financing is different if we are talking about a factory or non-factory team. While an official team is a cost, private teams are income. That is, the factories are their own patrons. The economic support comes from the manufacturer they represent. Honda, Yamaha, Suzuki, KTM … their racing departments give them a budget. They are multi-million dollar investments that exist, in addition to sports results, for research and development, training for engineers in the most demanding environments, relating the brand with the highest technological examples and presenting this message to the markets around the world.
All this comprises the millions of euros that the six factories in MotoGP spend throughout the year. Their budgets are “alleviated” with contributions from sponsors. And that alleviation is only notable because, in the case of large factories (read: the Japanese), the sponsors are more a marketing tool than an economic necessity. What’s more, there is a sine qua non condition that these sponsors don’t interfere in the team’s operation.
The financing of private teams is complicated. The costs are high and the difference in competitiveness compared to factory bikes makes it difficult to find sponsors powerful enough to pay for the “party”.
There are sponsors that directly inject money, while others are listed as technical sponsors, which are those that are related in some way to the motorcycling world and with which agreements are reached to supply components and commercial exchanges.
Another source of income is what DORNA pays every factory for each motorcycle that it enters into the championship, as long as they have more than two on the grid.
What for years was an endemic problem to cover the budget, DORNA eased by deciding to help finance the unofficial teams.
The approach for non-factory teams is entirely different, as they are structures that exist for a very different purpose. There is no technology development or research that goes on, but in some cases the goal of manufacturer promotion is shared, as in the case of Pramac. However, most teams are companies whose ultimate objective is as simple as making money. An exceptional case is that of Marc van der Straten, who was fortunate to be born into an economically privileged environment and who has set up a MotoGP team for the simple pleasure of enjoying the races on the front lines.
The financing of private teams is complicated. The costs are high and the difference in competitiveness compared to factory bikes makes it difficult to find sponsors powerful enough to pay for the “party”. What for years was an endemic problem to cover the budget, DORNA eased by deciding to help finance the unofficial teams. An aid that basically covers the cost of motorcycles, which means approximately 50% of the budget.
THE MAIN TEAM SPONSORS
Team Repsol Honda
– Honda Motorcycle manufacturer (Japan)
– Repsol Fuel (Spain)
– Red Bull Energy drink (Austria)
The relationship between the Spanish oil company Repsol and Honda has been going on since 1995. A collaboration that goes beyond MotoGP and simple sponsorship, since over time HRC replaced the former sponsor ELF fuel for the Spanish engineered fuel. As for Red Bull, this sponsor was placed onto the fairing of the HRC bikes in 2015.
Team Yamaha Factory
– Yamaha Motorcycle Manufacturer (Japan)
– Movistar Telecommunications (Spain)
– Monster Energy drink (United States)
After being with Honda and then exiting out the back door of the World Championship for what was perceived as disloyalty to the Japanese brand, Movistar returned to the Championship in 2014 with Yamaha to enhance its new audiovisual pay-per-view platform. Monster, as with Red Bull and Honda, ended up on the bikes’ fairing after passing through the riders’ suits, those of Valentino Rossi and Jorge Lorenzo.
Team Suzuki Ecstar
– Suzuki Motorcycle manufacturer (Japan)
– Ecstar Lubricants (Japan)
Following the model of beckoning sponsors “only when we are competitive” (read: attractive from a marketing point of view), the Hamamatsu factory assumed the entire MotoGP project bill. On their fairings they sport the name of Ecstar, Suzuki’s brand of lubricants. By the way, if you are surprised to see two companies from the same sector on the GSXRR fairing, there is a simple explanation: Ecstar and Motul are sister companies.
– Ducati Motorcycle Manufacturer (Italy)
– Philip Morris Tobacco (Multinational)
– Shell Oil
Ducati’s relationship with its main “travel companions” goes back almost to the beginning of time in the case of the Dutch oil company, one of the largest in the world. It’s a relationship that goes far beyond sponsorship (present since 1999) and is a complete technical collaboration. The link with the seemingly absent (but also very present) Phillip Morris, the most powerful tobacco company in the world, started with the very birth of the MotoGP project. A category that came from World SBK, where the L&M logo was displayed on Ben Bostrom’s bikes…wow, how time has passed!
– KTM Motorcycle Manufacturer (Italy)
– Red Bull Energy drink (Austria)
– Motorex Lubricant (Switzerland)
“KTM and Red Bull are one in the same,” KTM told us when we asked about their connection to the world’s leading energy drink. A duo that has joined by the Swiss Motorex, which from now on we will see on all KTM equipment in any discipline, in addition to supplying motorcycles lubricants that leave the Mattighofen assembly lines. KTM, Red Bull and Motorex is a solid three companies marriage.
– Aprilia Motorcycle manufacturer (Italy)
– Now TV Sky TV Channel (Italy)
– Tribul MasterCard Credit (Multinational)
The powerful Piaggio group is behind the Aprilia project. Now TV, Sky’s version of Netflix, has been with them for a couple of seasons, and at the end of last year they joined MotoGP with the Tribul Mastercard.
– GIVI Components for motorcycles (Italy)
– Castrol Lubricant (United Kingdom)
– Rizoma Components for motorcycles (Italy)
– Idemitsu Fuel (Japan)
A special case for Lucio Cecchinello’s team, this was a true sponsor management tightrope walk which has required the team to paint their fairings differently for every race depending on where the GP is held. In the case of the second rider who joined the team this season, the oil company Idemitsu looks like it will be the sole sponsor for the team; though this particular sponsorship has the advantage of being the “necessary Japanese sponsor” in MotoGP and being under the wing of Honda.
Team Marc VdS.
– Marc Vds. Maecenas (Belgium)
– Estrella Galicia Cervecera (Spain)
– Total Oil (France)
A unique project set up by Marc van der Straten. A millionaire from cradle, the Belgian beer entrepreneur can afford to pay the budget for a MotoGP team with his own money. Curiously, their main sponsor is a Galician beer brewer that was introduced into the team under the guidance of Emilio Alzamora and Marc Márquez. We know that before the reduction in exposure that occurred in Spain due to the introduction of the pay per view format, the people in charge at Estrella Galicia seriously questioned continuing sponsorship with the terms that existed when they joined the team. The van der Straten project is certainly a rare bird.
– Pramac Generators (Italy)
– Almá Human resources (Italy)
– FIAMM Batteries (Italy)
The “junior Ducati team” is the only private team managed by a company that uses it as a global escape from its brand.
Team Reale / Avintia
– Reale Seguros Insurance (Spain)
– Avintia Construction (Spain)
– Croisi Europe Tourism (Belgium)
After the departure of the team shareholder and owner of the Galician construction company Avintia, Reale Seguros, a subsidiary / company of Generalli, became the main sponsor. This season Croisi Europe has been added to the list, a Belgian company specializing in river cruises that came from the hand of Xavier Simeon. Tito Rabat has also contributed a good bit of money to the team in order to get the 2017 Desmosedici that he will pilot this year.
– Pull & Bear Clothing (Spain)
– Gaviota Awnings (Spain)
The new Team Nieto, former Team Aspar, is waiting to close a deal with a third sponsor which will help finalize the 2018 budget; It should be made public in the coming days. The former Team Aspar “makes cash” with a paid rider, that is, a rider who pays to ride the second motorcycle: Karel Abraham.
Team Tech 3
– Monster Energy drink (United States)
– De Walt Power Tools (United States)
– Motul Lubricants (France)
This is one of the most solid unofficial teams in the championship. The professionalism with which it is managed by Herve Poncharal, team owner, inevitably leads to sponsor relationships that are lasting. When Suzuki, KTM or Aprilia decide to set up a satellite team, this will surely be the first team door they will knock on… (We wrote this story before the KTM/Tech3 annoucement some days ago 😉 )