McLaren Racing boss Zak Brown says the F1 outfit's financial situation has significantly improved recently, insisting the team is now 'sitting on a better business model" to tackle the sport's future.
The McLaren Group which includes F1's second most successful outfit secured a financial loan at the end of June of £150 million from the National Bank of Bahrain, a financial institution partly owned by Bahrain sovereign wealth fund and McLaren shareholder Mumtakalat.
The fresh influx of cash has gone a long way towards alleviating McLaren's financial woes sparked by the onslaught of the global coronavirus pandemic which has impacted the automotive group's sales as well as the F1 team's revenue.
Furthermore, McLaren recently announced new F1 sponsorship deals, including a partnership with historic McLaren sponsor Gulf Oil, and Brown says there are more announcements to come.
"I think we’re in quite a good position now," Brown said, speaking at Silverstone.
"The bad news is behind us, as far as it relates to all the stuff that played out the last couple of months. We’re financially healthy.
"I think we’re benefitting from being aggressive and playing offence when COVID hit as far as recognising the severity of the issues it was going to cause for the sport and for us, and so we ran towards the problems to try and address them quickly, so we can kind of try and turn the page commercially.
"We’ve just announced Gulf Oil and Iconix, we have are a couple of announcements coming up, so we’re now exactly where we want to be.
"Looking forward I think we’re sitting on a better business model for F1 and for McLaren for the next journey of F1. We’re in quite a good spot, and spirits are high."
Despite the current global sharp economic downturn, Brown insists the deals he has secured were done so on a fair value basis. But the McLaren boss hints at a change of strategy among businesses as the world prepares to deal with the long-lasting consequences of the COVID-19 pandemic.
"All the deals that we’ve announced are real, substantial, the right size relative to the size of the arrangement," he said.
"Otherwise I think if you do partnerships in place that aren’t healthy, then it kind of messes up your business plan and bites you in the ass in 12, 24 months' time.
"We’ve got our plan, and we’re sticking to it. I think sponsorship is always hard, even in the best of times. I think next year will be soft.
"I am finding unlike the financial crisis in 2008 where everyone just stopped, that people now are dealing with COVID and recognising that we might have to deal with it beyond December 31, and therefore what I’m seeing is people are getting back to business, they’re doing business a little bit differently.
"Digital and social media, things of that nature, which I think we’re extremely good at, have become that much more important.
"That’s kind of replaced, in the short term, hospitality. But short of hospitality, we're still delivering hundreds of millions of eyeballs, still business to business relationships, still great content. We’re able to deliver the majority of the sponsor benefits, and it feels OK.
"We’ve got a lot of conversations going, so I’m expecting maybe a little bit slower growth rate than we would have anticipated for ’21, but we’re OK."
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