The Las Vegas GP was a big deal for F1, not just in sporting terms but from a commercial vantage point too. Having purchased land worth $500 million, Liberty Media knew it was betting big on the success of the Las Vegas spectacle. And they succeeded in these efforts massively. F1 Maximaal reports that the revenue and profit numbers for the final quarter of 2023 have got a big boost owing to the financial success of the Las Vegas GP.
F1’s revenue for the last quarter went to $1.23 billion, relative to $754 million in 2022, amounting to a 63% growth. This boost also helped improve the annual revenue for the sport – growing from $2.57 billion to $3.22 billion, a 25% improvement.
The profit figures have also experienced good growth, as F1’s bottom line rose to $392 million last year, a 64% YoY growth. However, F1 is not the only beneficiary with this improved financial health. All 10 teams will benefit as they get an increased share of prize money as per the Concorde agreement.
Among this distribution, Red Bull and Ferrari will be the biggest gainers in 2023. After dominantly winning the championship last year, Red Bull will earn the highest in terms of prize money – $184 million as per F1 Maximaal estimates.
However, Ferrari also earns an additional bonus (for being the oldest constructor) on top of their regular prize money share. This additional bonus boosts their total share of the prize pot to be the highest among all teams. As per the estimates for 2023, the Italian team will earn about $208 million.
How does the F1 Prize Pot distribution work?
The prize pot share for all teams accounts for 50% of the commercial rights’ profits of F1, according to Motorsport.com. Although this varies according to F1’s share of the profits which changes, in turn affecting the value of the teams’ prize pot. In 2022, this prize pot value stood at $1.157 billion.
In 2023, there are estimates this pot will increase up to $1.215 billion approximately. Reports suggest that Ferrari’s bonus for being involved in the sport since 1950 is around 3 to 5% of the prize pot value. Post this, teams mainly get their prize money based on their championship position from that year.
Some old teams like Alpine (previously Renault and Benetton), Williams, and McLaren may also have some bonus structure like Ferrari. Although given these teams came in F1 in the 70s and 80s, it won’t affect their prize pot share to that extent.
Meanwhile, teams like Red Bull and Mercedes who have been extremely successful in recent years also reportedly receive a bonus on top of their regular prize share. Thus, Mercedes may earn up to $179 million for finishing P2 in 2023. Meanwhile, McLaren’s estimated earnings may be around $117 million for finishing P4.
