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Should Troubled Teams Receive Government Help?

Should Troubled Teams Receive Government Help?

There was talk yesterday morning of a possible bail-out for the Honda team by the British government, sparked initially by a story in The Guardian newspaper. Although the suggestion has since been denied by those concerned at Brackley, the thought of a government helping an ailing Formula One team has fueled an interesting debate around the blogs. Most want to see Honda continue, but very few are in favour of taxpayers money being used.

The rumoured Honda deal would have seen the squad receive a share of a £2.3 billion bail-out loan for the motor industry. The team have qualified for such a share by meeting four criteria; turnover in excess of £25 million, being innovative, reducing carbon emissions and of course, creating jobs.

Initially, Honda remained silent on the speculation but later confirmed that while they have spoken with BERR, the discussions were not centred on any possible loans from the government. Instead, the talks were apparently about the progress being made with finding a new buyer and how this affects the 700 staff employed by Honda’s Formula One operation and associated departments.

We have met with BERR on several occasions, to discuss how things are progressing, plus the prospects for the team and their 700 employees.

However, we have not met with them to discuss a bail-out and no discussions have taken place about a government financial bail-out. Honda Spokesperson.

The majority of commenters on F1Fanatic are very much opposed to any bail-out for Honda, the general reaction being one of the taxpayer being forced to see their money poured into the never-ending pit of a very expensive sports team. Although most people want to see the team on the grid in Australia, most people object to paying for it.

I don’t think ex-Honda Racing should be allowed the money either, and I would like to know if they could comply since they aren’t a car maker in the traditional sense, that is making cars to sell for money…

If the government do start supporting them financially, are they going to be helping the other British teams too? DG on F1Fanatic.

Over at Sidepodcast, a similar feeling was voiced…

Sorry but with the needs coming from health care, schools, police, military, and other basic services; Why should the people of Great Britain have to pay because Bernie and Honda had a crappy business model? Dan Brunell on Sidepodcast.

However, with 700 jobs at stake the team is no small, uninspiring business, especially when those employees are highly skilled and for the best part, dedicated. After all, we are being led to believe the RA109 is still being prepared at the factory in case a buyer is found in time.

Perhaps throwing money at the problem is the wrong approach and the beleaguered squad certainly need something more sustainable for the next few years. But with time almost up, is there any other option for those who say they want Honda to continue (albeit with a new owner), but don’t want to have to pay for it?

Image © HondaF1.

Oliver White

7 comments

  • I have novel idea… Why doesn’t the Japanese Government pay for their own team!!

    Yes it’s sad that Honda are leaving F1, but the Honda Motor Company or their Government should do something about it, not ours.

    Perhaps we, the British tax payer, should bail out everyone who gets into trouble. It’s not like we have problems of our own…..

    Rant Over

    Enjoy

  • I have novel idea… Why doesn’t the Japanese Government pay for their own team!

    I get what you’re saying Stephen, I totally do. But just to be pedantic for a moment; HondaF1 is a British company*, registered here in good ol’ Blighty. It probably stems from when Tyrrell owned the team, or that Honda knew being based in the UK is pretty good in terms of locality to races (at the time) and skilled staff.

    But yes, perhaps Japan should step in. Although I think they’re probably more concerned with the actual Honda Motor Corporation than the F1 operation right now.

    *In case that search no longer works (I swear it did at the time of posting), Honda GP Limited have a company number of 00787446 – searching for this brings up their details. Similarly, RenaultF1 are registered in Britain, number 01806337.

  • Remindsa me of the kind of issue that could drag down the re-election plans of any number of political figures, at both the local and national levels.

    I have always admired the lively debates and spirited commentary in the House of Commons, esp. during Prime Minister’s Questions (while the U.S. Congress is a very capeable body, it is a snoozefest by comparison.) I know the future of Silverstone has been raised once or twice in those chambers- has anything relating to the past, present, or future of the team known as Honda been brought up by any MP lately?

  • Gman, there has been mention of the Honda F1 team in Parliament since Honda announced it was exiting F1.

    In Column 164 of the same debate, Lord Rooker hoped for a new buyer because of the US military organisations that want its technology.

    In Column 309, Phil Willis (Liberal Democrat MP for Harrogate and Knaresborough) asked the Speaker what Honda Formula 1 and companies like it could expect from the Queen’s Speech in terms of support. The reply was vague and concentrated mostly on training, which isn’t really what Honda F1 needed at this time.

    In Column 337, Mr. Tony Banbury (Conservative MP for Banbury) promoted Honda F1’s caused and prayed for a buyer because of the jobs it generates. (He also commented on the problem that unemployed people cannot take on substantial training and claim unemployment benefit simultaneously).

    In Column 369 of the December 8 2008 Hansard debates, Mr. Willis used Honda F1 as an example of research and wealth creation not being automatically connected to one another, and of how government strategy is not linking the two together well enough.

    However, by a week later, the debate about Honda F1 was already less vigourous (Column 110WH), but it still featured Mr. Brian Binley (Conservative MP for Northampton South) asking the government to put pressure on Bernie Ecclestone to stop causing so much damage to Silverstone and the surrounding economy (including Honda). He must read some of our blogs 🙂 Unfortunately, the government would not be drawn into a debate concerning Bernie Ecclestone, though it did acknowledge motor sport was important to the UK economy.

    However, there’s been nothing since 17 December in Parliament, possibly because other elements of the economy have demanded attention since then.

  • *In case that search no longer works (I swear it did at the time of posting), Honda GP Limited have a company number of 00787446 – searching for this brings up their details. Similarly, RenaultF1 are registered in Britain, number 01806337. {Ollie White – 4 comments ago}

    Don’t worry, it will work again at 7am. Companies House is very rare in internet circles in that its site actually closes down for part of the night, presumably for maintenance and cost-saving purposes. Its opening times are 7am-12 midnight.

  • Companies House is very rare in internet circles

    I have since worked that out. I find it very bizarre, but won’t question it. I gather it’s one of those things I will just have to accept! 🙂

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