Driving Today

Winning by Losing in F1

The Williams Formula 1 team has seen its fortunes decline as its profits have risen.

The old joke has always been “How do you make a small fortune in racing?” “Start with a large fortune.” It is funny -- OK, mildly funny but funny nonetheless -- because it is basically true. Motor racing, like sailboat racing and remodeling the house, is for all intents and purposes a money pit. Even low-level racers are always looking for sponsors to help fund their strange addiction, and big-timers couldn’t think of existing without such help. No matter what the level, racing is often a hand-to-mouth existence where no amount of money seems enough. And that makes it quite interesting that Sir Frank Williams, who is the head honcho of the Williams F1 team, has figured out a way to make a lot of money from a racing team. For the first half of 2011, Williams Grand Prix Holdings has seen its profits rise by 37 percent versus a year ago. Ka-ching.

At first glance, this is even stranger since the Williams team, which was a perennial F1 winner in the 1980s and 1990s, has slipped well down the pecking order in recent years. The organization has not won a championship in the sport for 15 seasons and, even more interesting, it hasn’t won a single grand prix race in seven long years. Currently the Williams team, which gets its engines from Renault, is a tail-ender in the standings, and its lone claim to current fame is the employment of lead driver Rubens Barrichello, who used to be a Ferrari mainstay. Barrichello hasn’t come close to winning a race this season.

So, when one looks closer, the key to Williams’ success as a company might well be its lack of success on the racecourse. Its other businesses, mainly in the technology and engineering sector, seem to do quite well, and the company’s recent listing on the Frankfurt stock exchange has been a success. Though the red mist of racing obscures many an executive’s judgment, Sir Frank seems able to resist its siren song in favor of collecting profits. We’re sure Williams F1 fans, if there are any left, would like to see the team return to its former glory, but its principal seems to have chosen cash … and who can blame him?



This site is provided by Plateau Property Management