From technology transfer through to changing perceptions of a brand, motorsport is a powerful tool for OEMs. Yet increasing costs of motorsport coupled with the relevance to today's younger audience – who appear less passionate about buying cars – are concerns. Dan Walmsley, team principal at Strakka Racing, explains the issues surrounding reliance on motorsport for revenue can cause and the opportunities to broaden its appeal.
Could you give us a brief background on Strakka Racing?
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Established in 2007, Strakka Racing was founded to provide a platform for our owner Nick Leventis to compete in contemporary GT racing. We started racing GTs; BMWs and Aston Martins before moving on to sports cars; the prototypes you see racing at Le Mans. In 2010, we won our class at that event and repeated that feat in 2013. In 2014 we expanded to include World Series by Renault single seaters and our driver Will Stevens went on to F1. We also embarked on a project to build our own car to race at Le Mans, which it ultimately did in 2015. This was around the time we started to look at Strakka Racing becoming a more sustainable business model. Running a sports car in the World Endurance Championship, the category that Toyota, Audi and Porsche compete in, even in the secondary and strictly privateer category, costs over £3 million a year. This rate of spend, probably about 5% of what the manufacturers are spending, is unsustainable through purely private funding so we looked to restructure.
What kind of activities were possible?
Our facilities in Silverstone are small but nonetheless comprehensive. Like any business, we first wanted our assets to work harder. We have a simulator for circuit acclimatisation and coaching. With simulation now a trusted driver development tool, we attracted a good number of drivers to come and use it. We started to look at other areas that would provide revenue and forged technical partnerships with businesses that could bring something different. An example was Stratasys, a leading additive manufacturing machine producer. We had seen on our own car build how 3D printing could save tooling and development costs and we felt becoming a sub-contracting facility could provide revenue. Setting this facility up is now a longer term aspiration but our appetite for innovation has been instrumental in positioning Strakka as technology leader, leading to other relationships and opportunities, including partnerships with Dell, and Xero, a software accounting business. Both were interested in using motorsport as a way to trial new technologies in a harsh environment. For example, our sports car does more mileage at Le Mans than an F1 car does in a whole season. These companies regard Strakka as an agile company and one that had to stick to deadlines; well you can't turn up late to a race! I think the sports car racing that we now focus on offers partners and OEMs much more of a chance to display relevant technology too; we have hybrids, diesel racing against petrol, all-wheel drive, etc. With F1 in a mess, with the right cost controls, endurance racing is the right platform for us to grow.
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You say F1 is 'in a mess'. What do you mean?
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By GlobalDataIt's not just F1 but the whole single seater ladder. We work with a lot of young drivers and the costs now associated with racing are getting out of control. Our own Formula V8 3.5 entry, a category that has been a spring board for drivers such as Alonso and Vettel, was not sustainable for us to run in 2016. As fewer drivers can afford to drive in the lower categories, there is less to feed F1 and I fear that without intervention, the pyramid to F1 could well collapse. I'd like to see the organisers get costs under control and create a more rigid structure so drivers know the right path.
Whilst manufacturers offer appeal to the championships, they come and go and are not concerned about the ramifications of abandoning a series. The privateer teams, those that rely on racing to survive, need to be heard and supported too. For example, I wanted to bring guests from Dell in a shuttle right up to the pits. I was going to be charged 750 Euros for a pass to drive them from their car park. That is crazy, we had already paid for VIP hospitality! People expect a seamless experience these days and having them walk 900m from the car park in what turned out to be a snowy morning, would have been unthinkable. All of us in motorsport have to think of giving the best experience possible or they won't come back. They'll choose rugby or golf instead. That's the decision that those sponsors have to make, not backing Strakka or Toyota or whoever.
Is that a genuine concern you have?
Most definitely. The days of sitting down and watching motorsport all day have frankly gone. We just don't have the time these days to be able to do that. There are just so many other draws on our time. That's why we have put more emphasis on social media and a responsibility to respond to all fan questions. Some championships have gone further. Formula E allows fans to vote for drivers to get a boost in the race and they have also taken racing to the fans. It held a race in the centre of Paris for its electric race cars last month. The Parisian authorities said it would never have happened for non-electric cars because of the environmental perception. These are the battles motorsport has to face! Without fans, interest will wane and sponsors, partners won't put their budgets into racing. They will go where fans get more access or the package works better online. I do applaud initiatives by the World Endurance Championship we compete in such as the chance for the fans to meet the drivers and the cars. It often takes cars to major cities near the races to engage people that don't see the sport. We had a school visit our garage at Silverstone and it's these things that motorsport needs to do more to stop us being marginalised and not just to be perceived as an elite sport.
Despite such issues, many OEMs claim motorsport improves the breed and justify participation with this message. Do you think it is true that racing improves the breed of road cars?
My father worked for a number of OEMs and Tier Ones (Andrew Walmsley was MD of Lotus Engineering, McLaren Automotive and Cosworth) and I've seen through his work how motorsport has long served as a useful tool for road car projects and their manufacturers but today's road and race cars are increasingly diverging. Even a Touring Car SEAT is very different from its road car cousin, despite the fact they look visually similar.
There is technology transfer and learning for sure. Audi has demonstrated new technologies such as LED lighting in motorsport first but when the OEMs feel the pain, motorsport is the first budget to be cut so it not an intrinsic part of an OEM's business plan for many.
I think motorsport has greater relevance outside of the car industry and that excites me. There are a lot of opportunities and I feel Strakka can play its part with our partners. For example, with Dell we offer a harsh environment to demonstrate how its products can survive being carried around the world and need to work in a variety of climatic conditions yet still be lightweight to meet our airfreight restrictions and still be powerful enough to perform. Key messages about battery life, processing power etc. can be highlighted in an environment that is appealing to its customers.
I'm also involved in several projects outside of motorsport that show how far our industry's knowledge can spread; be it through technology transfer, operational practices or pure management consulting.
One example is P1FX, an initiative we started that applies advanced motorsport data analysis to the foreign exchange (forex) markets as an alternative investment method for individuals or companies. It's been a fantastic case study for me in the application of things we do really well in motorsport and how compatible they are to the rest of the world. Not only have we had to develop the right tools for our customers but also create an efficient teaching method that allows people to understand a logical way of trading currencies.
What next for motorsport? Where do you see the opportunities?
I'm most excited by the technology behind motorsport and how it can work in really different fields like P1FX. I think motorsport still offers a culture that generates new thinking, driven by a passion of its participants and that package is relevant in any field.
I think we need to use motorsport differently to broaden its appeal. The motorsport stories that make the headlines outside our sport and away from the back pages of the papers are those technology nuggets such as an F1 pit stop team finding ways to improve processes in a hospital operating theatre or how CFD tools help our Olympic athletes, not the fact a new wing saves two-tenths or the fuel generated 3bhp more. We have to be mindful of how our sport looks to society and how it can be portrayed to be a positive movement not just an extravagance. Motorsport, like its technology needs to keep evolving, not believing it is immune inside a bubble.
So could we see Strakka build a road car or partner with a manufacturer?
I think this would be very interesting. We have had opportunities with a number of projects in the last 12 months, ranging from a range extender technology through to closer ties with OEMs. I would be very proud to see Strakka be chosen by a manufacturer as a partner. Such decisions are not taken lightly so we would be delighted to be in that position.
