N.Z. Holds Its Breath as America’s Cup Goes to the Wire

New Zealanders could barely watch as what had looked like certain America’s Cup glory became the prospect of an embarrassing defeat.

Kiwis have looked on in horror as Emirates Team New Zealand’s grip on the series has evaporated, with billionaire Larry Ellison’s Oracle Team USA turning an 8-1 deficit into an 8-8 nailbiter in the first-to-nine series in San Francisco. With New Zealand’s team losing the last seven races in a row, hopes for victory in the final are waning.

“Last week it was ‘we’ve got it in the bag, it’s just a matter of when’,” said Jose Ubiaga, co-owner of the Four Kings Sports Bar in Wellington, which has been opening for breakfast to coincide with live coverage of the event. “Now it’s ‘are they able to?’”

New Zealand stands to reap hundreds of millions of dollars if it can win the Cup for a third time and gain the right to host the next event about four years from now. The prospect of losing after being so far ahead has revived memories of the country’s past disappointments at the Rugby World Cup, where the national All Blacks side has failed to make the final three times despite being favorites to win.

Team New Zealand’s slump, and Team USA’s resurgence, was best captured in the last two races. In the first, Team New Zealand was penalized for a pre-start move and was behind throughout, while in the second it led after two of the five legs and then was passed easily.

‘Common Groan’

“When they finally did get passed there was a common groan right through the bar” and many simply left at that point, said Ubiaga.

The New Zealand Herald newspaper’s report on what it called “disastrous losses to Oracle” was headlined: “Is this the end for Team NZ?”

Cartoonist Malcolm Walker captured the national mood in Wellington’s daily newspaper the Dominion Post today. He drew a television viewer stretched to breaking point on a medieval rack as sailors worked furiously on winches at either end.

The newspaper’s front page headline beneath photographs of fans near tears or holding their heads was “Water Torture Wearing Down Kiwis.”

Public Screenings

Fans have gathered at bars, cafes and yacht clubs around the country as the races are screened from around 8 a.m. local time. In Auckland, the oldest remaining building on the wharf, Shed 10, has been converted into a public viewing space.

In a nation of just 4.5 million people, almost a million tuned in to watch the racing on Sept. 15, when Team New Zealand appeared set to take the Cup. More than 640,000 watched the Sept. 24 races, according to media-monitoring website throng.co.nz.

The regatta’s biggest comeback to victory came in 1983, when Alan Bond’s Australia II rebounded from a 3-1 deficit to beat Dennis Conner’s Liberty in a best-of-seven series. That win ended the New York Yacht Club’s 132-year hold on the trophy, the longest winning streak in sports.

New Zealand betting agency the TAB closed wagers on Team New Zealand when it reached an 8-1 lead. The odds on Oracle winning at that stage were 12-1, meaning a $1 bet would get $12 plus the original stake back. Now the U.S. team is a firm favorite, paying NZ$1.25 to win while New Zealand is at NZ$3.50.

A loss would dent expectations in New Zealand’s boat building and tourism industry. Previous Cup defenses in Auckland in 2000 and 2003 were worth about NZ$500 million ($409 million) each, according to impact studies conducted by Market Economics.

The Marine Industry Association predicts New Zealand’s exports of boats, marine technology and equipment will rise to more than NZ$1.3 billion a year in the next seven years from NZ$650 million in 2012, with the forecast based in large part on it hosting another America’s Cup defense.

Before it's here, it's on the Bloomberg Terminal.