Formula 1, more commonly known as F1, has entered a golden age of popularity in the United States in 2023. Off the back of Netflix’s immensely popular reality TV series “Drive to Survive,” more U.S. fans have tuned into each F1 race than ever before, and for good reason.
But first, some background about how Formula 1 works. The high-octane sport represents the pinnacle of motorsport, in which 20 of the world’s most talented drivers race for one of the sport’s 10 teams. Each team includes two drivers and a reserve driver, and most teams also have aspiring F1 drivers racing in other single-seater categories, such as Formula 2 or the Japanese Super Formula. With 20 cars on the grid, each team constantly develops its two identical cars within the regulations of the FIA, F1’s governing body, to stay competitive with the rest of the field.
Introduced in 2021, a $145 million cost cap limits the spending of each team, so that less financially affluent teams such as Haas and Williams can stay afloat against giants such as Red Bull, Ferrari and Mercedes. The series raced in 23 Grands Prix over the 2023 season, each taking place on 23 circuits over 23 race weekends. These are divided into practice on Friday, qualifying on Saturday and the race on Sunday. Sprint weekends are marginally different in that an additional, approximately 30-minute sprint race on Saturday accompanies Sunday’s 90-minute main event, with qualifying and practice sessions reshuffled slightly to accommodate.
Now that you’re up to speed, let’s get back to green flag conditions. “Drive to Survive” first aired in 2019 but rocketed in popularity following the historic 2021 season, giving fans unprecedented access to the sport’s paddock, teams and drivers. With TV viewership in the United States surpassing one million viewers per race for the first time over the 2022 season, expectations were high for 2023. Instead, viewership has plateaued, likely due to the current season’s title battle being one of the least competitive in the sport’s history, with record-breaking driver Max Verstappen and his team Red Bull clinching their respective drivers and constructors titles months before the season’s scheduled conclusion. F1’s stagnated rise isn’t just due to the sport itself, however.
Despite the slight decline in ratings, F1 commercial rights owner Liberty Media have enjoyed dramatic increases in profits during this decade, with the series expanding to a record 23 Grands Prix — three of which will be held in the United States, another record. 2022 season attendance smashed previous records, with the United States grand prix held in Austin, Texas attracting a circuit record 440,000 fans. With demand for tickets at an all-time high, the 2023 season’s ticket prices have also reached dizzying heights. It costs an average of $500 to attend a race weekend in 2023, up 56% since 2019.
Fan demand isn’t the only metric driving up ticket prices. Grand Prix circuit’s contracts with F1, which give them the right to host one of the season’s race weekends, range from $15 million to $55 million annually. Older and more prestigious circuits pay less due to their storied history, meaning newer and poorer circuits must compete with far higher costs for their privilege of hosting. This has substantial impacts on ticket prices as well as the longevity of circuits on the calendar. To compensate for the cost for hosting a race, circuits set initial ticket prices, which range wildly based on seating location and circuit access. F1 is and always will be an incredibly expensive sport. By continuing to raise the dollar value of hosting a Grand Prix, F1 threatens to further price out its fanbase and make attending a race a financial impossibility for fans.
An alternative could be the sport’s continued pursuit of high profile sponsorships. The sport has already seen a large uptick in interest from U.S. sponsors, helped by an average 276% increase in the valuations for F1 teams since 2019. Unlike many other sports, the global, traveling-circus-like nature of the championship makes advertising particularly attractive to multinational companies seeking to expand their reach to more global audiences under the banner of F1’s rising popularity. Investments from outside firms are becoming increasingly lucrative, and such partnerships could represent a massive revenue stream for F1 going forward. While F1 is unlikely to ever reach the gigantic valuations of American sports giants such as the NFL, which receive a vast majority of their revenue from TV deals, it could take a page from the NFL’s playbook and focus on growing revenue through fan accessibility rather than exclusivity.
Marquee to F1 management’s self-sabotaging greed at the expense of fans is the Las Vegas GP, which ran on Nov. 18 under the blinding lights of the Las Vegas Strip. Contrary to other tracks on the calendar, which typically host multiple racing series and have their own governing bodies, the strip was converted to be a race-worthy circuit exclusively by F1 itself, giving them unprecedented autonomy over the construction of the circuit and ticket pricing — to the tune of $500 million. Businesses along the track were required to pay vast fees for their patrons to see the race, with threats of barriers being put up to block their view if they didn’t pay up to $1,500 per head. The track itself is a total farce of a circuit, lacking any charm of other street circuits such as Albert Park or Baku and looking more like some misshapen animal than a Grand Prix track.
Liberty Media vastly overestimated demand for the race, with initial prices set at an eye-watering $2,000. Contrary to almost every other race on the calendar, tickets hadn’t sold out days before the race and prices tailspun, down 70% overall and 20% in the lead up to the weekend. A testament to the untarnished allure of a Formula 1 spectacle in Vegas, the Grand Prix was still a roaring economic success, with 315,000 attending and the race bringing in $1.2 billion to the Las Vegas area after the dust settled. The race itself saw seven lead changes in a thrilling contest no one saw coming.
The penultimate weekend of the season was still not without controversy — after a loose drain cover caused heavy damage to the Ferrari of Carlos Sainz and abruptly ended the weekend’s first practice session after just eight minutes early Friday morning, fans were sent home outraged. In response to $200 race merchandise vouchers offered to fans for their trouble, reigning world champion and impassioned critic of the Grand Prix Max Verstappen said: “If I was a fan, I would tear the whole place down.” Liberty Media’s egregious attempt at price inflation finally backfired and cast an ugly shadow over an otherwise glamorous race weekend that proved to also be one of the coldest in the sport’s history.
F1’s bet on having the Grand Prix in the entertainment capital of the world hasn’t paid off and threatens to become a total bust for the organization. By setting their sights on Vegas’ highest rollers, F1 has shown how little it cares about the growth of their sport among low-income potential fans and threatens to undo the unprecedented strides the sport has made in terms of fan access and engagement over the past several years.
Maximilian Schenke is an Opinion Columnist who is passionate about international politics and how they affect us locally, but often writes about national politics as well. He loves receiving criticism or otherwise at maxsch@umich.edu.