Rbs Cutbacks Signal End Of Williams F1 Deal
The debt-ridden Royal Bank of Scotland is to cut its investment in British sport by 50% including ending its sponsorship deal with the Williams F1 team at the end of 2010, another body blow to the sport’s finances.
The bank, in which the government has a stake of almost 70% following a bail-out of the firm in the wake of the recession, will end its deal with Williams F1 at the end of the existing contract and has also cancelled trackside advertising for 2010.
The move came as the indebted firm announced losses of £24.1bn for 2008, the biggest such loss in UK corporate history.
The news that RBS will end its partnership with Williams F1, thought to be worth around £10m a year and amounting to around 10% to 15% of the team’s budget, is another blow to the Oxfordshire-based team and F1 in general.
One of the few independent teams left on the grid, Williams F1 has already lost its sponsorship deals with Baugar, Lenovo and Petrobras.
The team remained confident however saying there is a ‘95% chance’ that it will be able to name a replacement for RBS within the ‘next 12 months’ and that it was well covered in terms of investment for this season and next.
F1 is already going through a tough time, having seen Honda withdraw from the sport and Renault lose their main sponsor, ING, from 2010 while a host of other sponsors have pulled their investment.
RBS’ hospitality budgets aligned to all its sponsorships have also been reduced by around 90% in 2009.
The bank will also review its individual sponsorship deals with the likes of tennis star Andy Murray and cricketer Sachin Tendulkar.
RBS, expected to announce a loss of up to £28bn this week, is reviewing all sponsorship activity as part of its strategic review.
One sponsorship property however is safe after RBS recently extended its sponsorship of the Six Nations rugby union championship for a further four years in a deal worth £20m.
‘We recognise that we are now operating in a very different economic environment and have been reviewing all of our activities since October,’ said Dr Andrew McLaughlin, RBS group director.
‘It is imperative that we respond to the reality of the situation we face and that we do so in an orderly way that respects the commercial agreements we have in place and the implications for our partners and the jobs they support.’
