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14 Jan 2004, 15:50 (Ref:838055)
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Subscriber
Veteran
Join Date: Jan 2000
Posts: 4,304
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The Dollar effect.
http://www.pitpass.com/news2/news.cfm?newsid=8346
The recent weakening of the US Dollar has reached F1, the majority of F1 sponsorship deals are done in Dollars, but the recent slide means that those deals are now devalued by the currency move. Smart cookie of the year award goes to David Richards, who last year switched BAR's deals from dollars, to being transacted in sterling. No doubt few hearts will bleed that the multi million dollar teams will be a few dollars light due to currency moves, but it's a sign (at last) that some sort of world event will impact on the F1 'eggshell' and hitting teams in one of the few areas they take note - the pocket! It could also impact on the FIA benefits paid out to teams, which could have a knock on effect if the dollar slide continues. Last edited by Super Tourer; 14 Jan 2004 at 15:53. |
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'I've seen it, but still don't believe it.....' 
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14 Jan 2004, 15:55 (Ref:838060)
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The Honourable Mallett
20KPINAL
Join Date: Feb 1999
Posts: 37,306
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Dunno about F1, its crippling me at the moment.
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I've decided to stop reaching out to people. I'm just going to contact them instead.
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14 Jan 2004, 16:05 (Ref:838087)
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Subscriber
Veteran
Join Date: Jan 2000
Posts: 4,304
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Sorry to hear that Peter.
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'I've seen it, but still don't believe it.....'
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14 Jan 2004, 16:22 (Ref:838113)
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Veteran
Join Date: Mar 2003
Posts: 4,512
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about teams, well it depends on how much of their expenses are done in USD.
If most of them are, it's not a big problem, differently it would be disgraceful, particularly for the small fish. Last edited by climb; 14 Jan 2004 at 16:22. |
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You got to learn how to fall, before you learn to fly P.Simon
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14 Jan 2004, 16:37 (Ref:838140)
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Veteran
Join Date: Jun 2002
Posts: 739
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If a team has been paid pre-currency slide then they should be okay especially if the suppliers contracts are also in Dollars. The dollar and for that matter the Asian market are low at the moment with the Euro getting stronger and the Sterling holding firm. Currencies go up and down adn although the dollar is in a major slide I do not believe we will start seeing a 1929 style USA bankruptcy. The big teams should be in good enough shape to take a hit but when it comes to the crunch all the teams are in the same boat and must deal with what is thown at them. Motorsport has never just been about the racing first you need the equipment and thus money to go with it. So long as companies do not go under sponsership will continue and a wise team will of put a rule about currency changes into contracts.
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14 Jan 2004, 18:48 (Ref:838306)
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14th
1% Club
Join Date: Jul 2001
Posts: 42,603
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On a minor point the hotels etc.. will be cheaper in pound notes for some of them.
If there was an American driver (who still lived there) then he might have seen his earnings fall! |
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Seriously not taking motorsport too seriously.
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15 Jan 2004, 10:53 (Ref:839075)
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#7 | ||
 Race OfficialVeteran
Join Date: Jun 2001
Posts: 13,038
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Well in any business where you have expenditure in one currency and income in another, your financial guys should have hedged themselves thus rather negating the Dollars slide. For those teams based primarily in the UK or mainland Europe expenditure will be in Sterling or Euro whilst income may well be in Dollars.
The problem they face is that the US stance on its currency has changed over the past few months. For years we have had the 'strong Dollar policy' promoted by Alan Greenspan (Federal Reserve Bank) and others. Whilst they still crow on about the policy the truth is that behind the scenes the US are preparted to see the Dollar fall against the major currencies. What you are seeing now is not Sterling or Euro strength but Dollar weakness. In my view this will continue for some time yet and that we will see GBP/USD at or around 2.0000 and EUR/USD around 1.4000. If that were the case then the EUR/GBP cross rate would remain around 0.7000 (guess what I do for a living!) |
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__________________
The Priest Catcher Honoured recipient of the BARC Browning Medal
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15 Jan 2004, 11:03 (Ref:839082)
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#8 | ||
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Veteran
Join Date: Feb 2000
Posts: 2,188
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Is it true that they only have an interest rate of 1%?
It quite annoying because I have been working on a sponsorship deal in dollars, before christmas it would have been more than enough and now its a lot lower. Im going to have to add about 20% onto the deal and look quite stupid. |
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A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
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15 Jan 2004, 11:08 (Ref:839087)
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Race Official Veteran
Join Date: Jun 2001
Posts: 13,038
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Yes, USD interest rates are around 1%, EUR a tad over 2% and GBP 3.75%
The exchange rate hasn't moved 20% since before Xmas though 24/12/03 1.7600...today 1.8300 |
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__________________
The Priest Catcher Honoured recipient of the BARC Browning Medal
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15 Jan 2004, 11:19 (Ref:839105)
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Veteran
Join Date: Feb 2000
Posts: 2,188
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I thought it was 1.44 before christmas. The calculator I was using rekoned so.
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A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
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15 Jan 2004, 11:20 (Ref:839107)
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Race Official Veteran
Join Date: Jun 2001
Posts: 13,038
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That was probably Christmas 2002
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__________________
The Priest Catcher Honoured recipient of the BARC Browning Medal
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15 Jan 2004, 11:29 (Ref:839119)
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#12 | ||
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Veteran
Join Date: Feb 2000
Posts: 2,188
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Buggar, maybe I should have looked at ceefax instead of being lazy
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__________________
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
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15 Jan 2004, 12:58 (Ref:839181)
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#13 | ||
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Race Official Veteran
Join Date: May 2003
Posts: 11,142
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It was over the $1.50 to the £ mark all last year and has been steadily dropping to what it is now. I personally hope the slide continues as I am going to the USA in the summer.
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15 Jan 2004, 13:00 (Ref:839184)
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#14 | ||
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Race Official Veteran
Join Date: Jun 2001
Posts: 13,038
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If it gets close to 2.0000 then buy your Dollars Falcemob
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__________________
The Priest Catcher Honoured recipient of the BARC Browning Medal
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15 Jan 2004, 13:04 (Ref:839188)
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Race Official Veteran
Join Date: May 2003
Posts: 11,142
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I was seriously thinking of getting them very soon.
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15 Jan 2004, 13:08 (Ref:839192)
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Race Official Veteran
Join Date: Jun 2001
Posts: 13,038
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Reckon you might see 1.9000 before long but keep a close eye on it.
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__________________
The Priest Catcher Honoured recipient of the BARC Browning Medal
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