Editorial: A slow side to fast cars

OPINION: Top sport is business. That fact will have hit home to many with the news this week that one of the two men responsible for bringing the V8 Supercar racing to Hamilton is having to sell his home to help keep the event afloat.

Dean Calvert's $1.5 million-plus ocean-view Raglan home is up for mortgagee sale next month. He says he is having to sell it to help keep the company that runs the races alive.

That will come as a surprise to the uninformed who have assumed the former Aucklander, along with business partner Steve Vuleta, had come to Hamilton to cream money off the locals for the seven years the V8s were contracted to race here.

In fact, Calvert is like any other businessman, vulnerable to the vagaries of a New Zealand economy that has been hit as much as any around the world.

Calvert was extremely upfront when the Times broke the news of him losing his house. He revealed Hamilton 400 revenue had tanked from $14 million in the first year to $10m last year for edition two.

That is a massive drop but will not be a surprise to anyone in business – many companies have reported earnings down by more than 40 per cent year-on-year as the banking crisis hit its trough.

Understandably there is a flow-on to the V8s; much less sponsorship and hospitality spending by happy firms (though sponsorship, remarkably, is up for the 2010 race, Calvert says) and punters with less money in the pocket reassess where they will spend their discretionary dollars.

Spectator numbers, bearing that in mind, for year two were always going to drop and no one should have expected the first-year hysteria to continue anyway.

What is most concerning though is Calvert's admission ticket sales are slow this time around. No business can sustain ongoing losses and the V8 organisers in Australia will be paying close attention to spectator numbers next month. Will the V8s see out the seven-year Hamilton deal if the Calvert-Vuleta combination goes under? Almost certainly not.

The lack of spectator interest is mystifying and hopefully only temporary. Reputable surveys carried out by this paper and others before we won the V8 rights showed overwhelmingly people wanted the car racing here. City pride was at an all-time high.

The organisers are making it a better spectator event each year – the new non-reserved grandstands this year allocated to general admission ticket holders the best example of a much-needed improvement this time around. Even those paying the cheapest prices will be able to get a seat in a stand. Vuleta laid down the challenge this week: use it or lose it. It is not a threat, it is business. Unless we go to watch, they will leave town. It was public support that encouraged Hamilton City Council to plough in $7 million to bring the racing here. If we have all now turned off the races, not only will Calvert lose his house, the city loses much, much more.

- © Fairfax NZ News