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Is It Time for Formula 1 to Have 2 Tyre Suppliers?
Published: August 7, 2013
Whilst competition certainly is a good thing in most avenues of life, certainly regarding large multinationals, such a monopoly currently exists regarding the supply of tyres to Formula One teams, and things haven’t gone smoothly in 2013.
But whilst many people are already jumping on the back of Pirelli after a series of well-publicised problems, I think it’s far too early to press the panic button and call for a so called "tyre war" with two suppliers for two fundamental reasons.
1. The legal issue
When Bridgestone decided to bail out of Formula One as the official tyre suppliers in November 2009, Cooper Avon, Michelin and Pirelli all professed interest in becoming the sole supplier for 2011. Pirelli won the contract and currently spend around $50 million a year on circuit advertising and programmes and are likely to be the only contender to remain in the sport to see Formula One through the first three years of the V6 turbo era when the contract is up for renewal from 2014-16.
As teams also get a share of around 40 per cent of Pirelli’s marketing spend in return for what they spend for the tyres, you’d think that there would be no shortage of contenders to bid for the new contract, especially in light of the Italian tyre supplier’s recent failings.
Think again.
While, say, Michelin or Goodyear have the right to bid for the new contract when it’s up for renewal, commercial-rights holder Formula One Management have agreed with Pirelli to extend the sponsorship signage deal to 2018. Would a new supplier really want to supply tyres without the added track advertising exposure Pirelli have cunningly negotiated?
Nor are the FIA allow...
Article Source: Bleacher Report - Formula 1
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