This weekend the first night race in the history of Formula 1 will take place in Singapore.  It is the second new race this season and like Valencia before it, the Singapore Grand Prix is a street circuit.  Also like Valencia, Singapore has invested in Formula 1 as part of its overall tourism and sporting strategy.

Alan Switzer, Director in the Sports Business Group at Deloitte commented: “There is no more prestigious global sporting event that a city can host over a single weekend.  Grands Prix are a scarce resource with intense competition to host them.  The 17 Formula 1 Grands Prix generated average revenues of US$229m per race in 2007 (see notes to editors), confirming their status as the world’s highest revenue generating annual sporting events.  Singapore is leveraging the value of Formula 1 as part of its tourism strategy, showing to the world that the city is a top end leisure and tourism destination.”

Singapore and Valencia have both seen the value of major sporting events in building a city’s profile as a tourist destination.  They have both invested heavily in creating ‘sports hubs’ within the cities which also include new marinas which will host a stage of the Volvo Ocean Race and the America’s Cup respectively.

The cost of staging the Singapore Grand Prix is reportedly in the region of US$150m over five years, excluding the promoter fee, with 60% of that contributed by the government through the Singapore Tourism Board and the remaining 40% through the private sector entrepreneur Ong Beng Seng.  Over 95% of the 100,000 tickets available per day have already been sold, with 40% of those purchased by overseas visitors.  The Singapore Tourism Board anticipate incremental revenue of around US$70m from direct expenditure at the Grand Prix as well as the intangible benefits the city will receive from being associated with the premium brand that is Formula 1.

Stephen Dunham, Senior Consultant in the Sports Business Group at Deloitte said: “The Singapore Grand Prix will be one of five races in Asia in the 2008 season.  With Abu Dhabi hosting a Grand Prix in 2009 and India and South Korea reportedly aiming to host Grand Prix in 2010, there may soon be eight Asian based races compared to only one ten years ago.

“Formula 1 has a strategy to increase its presence in Asia, broadening its fanbase whilst also generating higher promoter fees compared to traditional European races.  Indeed, promoter fees have increased to such an extent they are reportedly comparable to broadcast revenue in 2008.

“The new race in Singapore will be the first night race in the history of Formula 1 with the start time amended to coincide with the European broadcast market (8pm local/1pm BST).  Formula 1 are seeking to maximise revenue generation by balancing expansion into new markets whilst protecting its existing fanbase.  Depending on the success of the ground breaking experiment, we could see more Grands Prix in the future with their start times set for the European broadcast market.”

- ENDS –

Note to editors

The US$229m average revenue per race is comprised of central revenues (from broadcasting, race sponsorship and corporate hospitality, team revenues (including sponsorship and contributions from their commercial partners and owners) and circuit revenues (from ticketing and certain sponsorships).

About the Sports Business Group at Deloitte
Over the last 15 years Deloitte has developed a unique focus on the business of sport. Our specialist Sports Business Group offers a multi-disciplined expert service with dedicated people and skills capable of adding significant value to the business of sport. Whether it is benchmarking or strategic business reviews, operational turnarounds, revenue enhancement strategies or stadium/venue development plans, business planning, market and demand analysis, acquisitions, due diligence, expert witness, audits or tax planning; we have worked with more clubs, leagues, governing bodies, stadia developers, event organisers, commercial partners, financiers and investors than any other adviser.

For further information on our services you can access our website at www.deloitte.co.uk/sportsbusinessgroup

About Deloitte
In this press release references to Deloitte are references to Deloitte & Touche LLP, which is among the country’s leading professional services firms.  Deloitte & Touche LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu (‘DTT’), a Swiss Verein whose member firms are separate and independent legal entities. Neither DTT nor any of its member firms has any liability for each other’s acts or omissions. Services are provided by member firms or their subsidiaries and not by DTT. Deloitte & Touche LLP is authorised and regulated by the Financial Services Authority. The information contained in this press release is correct at the time of going to press. For further information, visit our website at www.deloitte.co.uk