Online Extra: Formula One's Hard-Driving Chief
Bernie Ecclestone has been the dominant personality in Formula One racing ever since he began acquiring control of the series' broadcasting and merchandising rights in the early 1980s. The series, one of the few sporting events with global appeal, has made Ecclestone and his wife, Croatian-born former model Slavica, among the richest people in Britain, with a fortune estimated at $4.2 billion.
But Ecclestone has long clashed with auto makers such as Ferrari and Mercedes-Benz, which finance the Formula One teams. They accuse Ecclestone, a former used-car dealer, of being excessively secretive about the web of Formula One companies he controls and of funneling too much revenue to his own holdings while Formula One's popularity sags.
Now a group of auto makers, consisting of Mercedes parent DaimlerChrysler (DCX ), Gruppo Ferrari Maserati, BMW, Renault, and Ford Motor (F ), are laying plans to displace Formula One with a new racing series beginning in 2008.
In a rare interview, Ecclestone spoke by phone from London with BusinessWeek Frankfurt Bureau Chief Jack Ewing about the criticism against him and his rivals' plans. Edited excerpts from their conversation follow:
Q: How serious are the carmakers about starting their own series? A:
Q: How serious are the carmakers about starting their own series?
A:I have no idea.
Q: What are the chances of an agreement with the carmakers? Are talks going on? A:
Q: What are the chances of an agreement with the carmakers? Are talks going on?
A:We talk all the time.... The problem is that we signed a memorandum of agreement some time ago. The necessity was for the manufacturers to confirm their participation until 2014. They said they couldn't do it. Our banks wanted to have the opportunity to go to market [via an IPO], which they couldn't do without a commitment. We're happy to sign today [if the auto makers commit to 2014].
Q: What are the chances that a rival racing series can be successful? A:
Q: What are the chances that a rival racing series can be successful?
A:What do I think the chances are? I wouldn't want to do that. I don't think I could do it even. The people they're talking to have no idea of Formula One. It's not [the auto makers'] business. It's like me starting up a rival car company. They don't know what they don't know.
Q: The auto makers complain your organization isn't transparent. A:
Q: The auto makers complain your organization isn't transparent.
A:It couldn't be more transparent than it is. We're probably more transparent than the auto makers.
Q: The racetracks also complain that they have to pay too much, and that's driving up ticket prices. A:
Q: The racetracks also complain that they have to pay too much, and that's driving up ticket prices.
A:They pay what they contracted for. They know what their commitments are. The biggest problem for promoters is that they had life very simple. All they had to do was print tickets. They've got to go out and sell their tickets. They don't promote anything.
Q: Do you intend to manage Formula One as long as you're able? A:
Q: Do you intend to manage Formula One as long as you're able?
A:Absolutely. I'm in the office today at 8 a.m. I left America [following the U.S. Grand Prix in Indianapolis] last night.
Q: They're also concerned about who your successor will be. You're 74.... A:
Q: They're also concerned about who your successor will be. You're 74....
A:I'll be 74 at the end of the year. We have enough people around that if -- I don't want to say if I was run over by a bus -- but if I someday died of more natural causes, things will continue. They'll find someone. It's easier to walk into a business that's already built up. The shareholders of our company will find someone. [Pause] I'm looking for a good used-car dealer.