Hanoi expects benefits from hosting F1 race
The news about the plan to bring F1 to Vietnam has been confirmed by FIA (Federation Internationale de l'Automobile), to take place in 2020 in Hanoi, Vietnam. International media reported that the F1 race project in Hanoi may cost $60 million or higher.
The money to organize F1 will not come from the state budget, but from investors in different economic sectors. This was confirmed by chair of the Government Office Mai Tien Dung at a press conference in August.
According to Prof Dr Augustine Ha Ton Vinh, three things need to be considered – expenses, revenue and organization.
If Hanoi successfully organizes the F1 race, it will help polish the national image and prove that Vietnam is capable of organising the world’s big events.
The first is the most important, which includes the pay for the race’s brand, estimated at tens of million of dollars, expenses on arranging race tracks and security activities, and expenses on ads. One race could cost $70-80 million.
Vinh said there are three sources of revenue. First, the revenue from the sale of live TV broadcasting rights to companies and news agencies, and earnings from ads and admission tickets.
“F1 race is not an event that the government has to organize, and it is not an activity that brings benefits to the nation. However, it will help polish Vietnam’s image and improve the nation’s prestige,” Vinh said, adding that it is not easy to obtain the right to organize F1 in Vietnam.
The tournament is organized once every 3-5 years. When it is organized for the first time in Vietnam, investors may accept a loss of 10-20 percent for the sake of the nation’s prestige.
Third, where to hold the race is a matter that needs thorough consideration. An analyst said there are two options, either in a place like Monaco with a race track, or on streets with fences like in Singapore and Macau.
“Since Vietnam still doesn’t have a race track, it only can organize F1 on streets,” he predicted.
If the city authorities want to organize the event in My Dinh area, he suggested that it would be better to build a racetrack from My Dinh to Lang-Hoa Lac Road.
When asked what Hanoi will gain if it organizes such a costly event, Vinh said the biggest benefit is that Hanoi can advertise itself as a cultural and modern capital city that can organize big international events.