Motorsport: The V8 brigade

Crowds at the Hamilton 400 V8 Supercars. Photo / Herald on Sunday

V8 Supercars boss Tony Cochrane and his boys are quite used to doing rescue jobs on Supercar events. It wasn't always that way.

They used to just turn up with the heavy V8 metal to race and someone else would do the organising.

But over the years, as promoters fell over and Supercar events drained more bucks than a V8 sucks petrol, the Australian company increasingly steered its way into V8 event organisation.

The Hamilton 400 is no different. V8 Supercars are the new promoters, inheriting a disillusioned community, and a mayor and council anxious not to lose any more millions in the wake of ratepayer outrage.

When the new council opened the books last year, they found ratepayers had been stung by a V8 budget blowout of $27.4 million after hosting the event for three years. They'd been told the figure was closer to $11m, which was bad enough.

By the time previous promoters, Caleta Streetrace Management, were shown the door, Hamilton - understandably - had a bad attitude. The average local could see little tangible evidence of the promised global exposure from millions of petrol heads watching V8s race round an industrial part of their town, nor could they quantify the so-called economic benefit to the region, estimated to be $25m.

But like any well-oiled events organisation, V8 Supercars is good at spin. The company doesn't accept it's starting on the back foot, rather that the slate has been "wiped clean". It's ground zero and the only way back is up, they say.

On April 15, when the firstV8s roar past the chequered flag on the race circuit, V8 Supercars will be driving the event's success or failure. They've given themselves seven years and expect to make a profit well before then.

Hamilton is the ninthV8Supercars event, including the revered Bathurst 1000, the company organises and promotes. The other five are run by franchise holders.

Shane Howard, V8 Supercars' chief operations officer, knows that winning back the support of locals will be as important as the bums-onseats aspect of running a successful event.

He says the company is happy to be judged on its performance after the three-day event. He says they have the "horsepower and the knowledge and the financial resources" to turn the event around.

Those financial resources come from a company with a $35m turnover which makes its money not only from theV8 Supercar teams but from TV production and broadcast, event management, and the management of stars such as Shane Warne and Sir Michael Parkinson.

Part of the company is up for sale, a transaction potentially worth hundreds of millions of dollars. The sale of the company-75 per cent owned by the 17 race teams and 25 per cent by Sports Entertainment Ltd-could see Cochrane stay involved with motor racing but part ways from his entertainment-orientated business partners.

He's still committed to the multimillion development of a new prototype V8 "Car of the Future" that will be cheaper to build than the $600,000 model teams go through with shocking frequency.

In the meantime, the company is concentrating on making Hamilton roar, conscious of its $12m investment to put on the event, transport the teams and stage concerts by veteran rockers ZZ Top and pop punk act Good Charlotte.

Despite the big dump of cash, V8 Supercars are the first to admit it's unlikely they'll turn a profit this year - a profit which, under a revamped deal, will be shared with the council.

In fact, they'd be delighted if they broke even.

One observer in the racing circuit says if Hamilton is unlucky enough to have foul weather over the three days, the event will bomb and Hamiltonians will once again be out of pocket. But the company is underwriting the event so that if it fails, V8 Supercars will be left with the bill, not the council.

For its part, the council is forking out $1.1m for track preparation and operational costs, plus a confidential sponsorship fee.

While Mayor Julie Hardaker hopes to see a profit from this year's event - and has asked Hamiltonians to get behind the race - the V8 Supercars bosses are coy about promising too much.

They have a way to claw back.

The first year, 2008, attracted 165,000 people. By last year that number had dwindled to 105,000. The target this year is 140,000 people over the three days - 30 per cent of whom will come from Auckland-each forking out anything from $105 for general admission to $250 for the "platinum" grandstand pass.

The promoters know that's a hefty target in a difficult economy and in a year when the Rugby World Cup is expected to suck wads of spending money out of sports' fans wallets. Apart from ticket sales,V8 Supercars is counting on attracting more corporate money and sponsorship than in past years. So far, they say, ticket sales and corporate takings are ahead of last year. And, with the price in mind, they argue value for money as an added bonus.

Children under 12 will get in free and can be entertained in a kids' zone with bouncy castles and fun rides. Adults can play on an 8m slide or ride the mechanical bull.

Using the Queensland V8 event in Townsville - which attracted 165,000 people last year - as a model, the organisers are introducing the "rock 'n race" format with ZZ Top performing after racing stops on Saturday night and Good Charlotte on Sunday. In addition local bands can slog it out in a battle-of-the-bands competition to win a support spot for Good Charlotte or ZZ Top.

There will also be a junior press conference where students get to quiz their race car driver heroes, and a stunt team demonstrating on the track.

"This is very much about family entertainment," says CEO Martin Whittaker.

Howard says V8 Supercars is in Hamilton for "the long haul" and rejects suggestions that the event could move back to Pukekohe race track or to the new Hampton Downs, a purpose-built track between Auckland and Hamilton. Neither would be suitable for the scale of the event, he says.

The company says it could have walked away from the event last year, instead entering into a four-year agreement with a three-year option.

"It's an investment in the future. It is our goal to turn this event around and make it profitable. The council have spent a lot of money on infrastructure, they've supported the event and the people of Waikato have supported the event, our alliance is with that," Howards says.

But not everyone's convinced. Some business owners are adopting a wait and- see approach to the newcomers while others are sceptical about the $25m benefit to the region, a figure bandied about when the organisers were lobbying for the event to come to Hamilton.

Edwyna Carlson's florist business, Florist Ilene, in the centre of the course track, has taken a hit from the event in previous years. The first year was "diabolical", she says, but things improved after that. Even though there is still road access to the business area inside the track, shoppers were reluctant to cross over into the zone. "We've done the hard yards now. To say, 'Go away' now, would be silly," says Carlson.

So far she has been impressed by the new V8 Supercars organisers, who she describes as more positive and communicative than their predecessors.

A few doors down Commerce St from Florist Ilene, Evelyn Booth at Bags Factory Shop is considering closing her business during the event, especially if other businesses in the area do the same. "If they're not open and I'm going to be the only one then it's pointless, I may as well go home," says Booth.

She says the hospitality industry may have seen their profits boosted but she has not. Last year business on the Sunday of race weekend was so slow that Booth shut her doors at 12pm. She says the four tickets that organisers provided was little compensation. "That actually doesn't pay the rent."

After four years, Booth would rather the race was held elsewhere. "I can understand now why the other towns didn't want to have it. It has cost Hamilton and it has cost us as ratepayers," she says.

Just along the road Paperzone owner Patsy Clarkin sells custom-made invitations. She opened up in Frankton two years ago and supports the Hamilton 400, which she points out were there before her business. "We think it's good for the city. We wish everyone should stop moaning and get on and make this one successful," says Clarkin.

However, she does acknowledge that the event has not helped her profits as customers stay away during the event despite there being still being road access to the area. "A lot of people put getting to Frankton in the too hard bin," says Clarkin. "It's a mindset and it hurts our piggy bank."

John Entwistle owns Hamilton Cylinder Head and Engine Services on Lake Rd, also inside the track. Like other retailers, he says the economic spin-off has not benefited him directly but he urges local businesses to get behind the event and contribute to a carnival atmosphere. Entwistle has already put chequered flags up on the street to build awareness of the race.

Every year he joins with 10 other businesses in his street to create "Race Mode on Lake Rd", a free family focused attraction with fancy car displays and food that is designed to cash in on the thousands of extra people walking by.

"We're trying to make the best of what's happening in the area," says Entwistle. "It's here and unfortunately we've got to live with it."

Mayor Hardaker says she has sympathy for the businessowners of Frankton but the council is bound to continue hosting the event.When the engines have cooled, she will be seeking a cost benefit analysis to determine exactly what impact it has on the region.

In 2008, Horwath HTL Ltd valued the economic impact at $28m. Since then Hamilton City Council has been working on the assumption that the event brought in about$20mto the city in 2009 and 2010, but lacks concrete evidence to support this claim.

The council's decision-making in the past will be under the microscope and will this month start an investigation to establish if the council contributed to the huge blowout of costs.

The new promoters argue that getting a return on big motor sport events takes time. They use Adelaide's Clipsall 500 (not a V8 Supercars event) as an example of an event which lost money in its first few years but now returns millions of dollars a year to the South Australian Government.

And they point to their success with the Gold Coast 600 which the Queensland Government askedV8 Supercars to take over last year. The company claims it was a "massive success" although admits the event didn't make a profit. But, like Hamilton, they're confident it will after transforming it into family-based entertainment and getting rid of "booze filled young men and bare-breasted women".

The organisers know they still have a way to go before every Hamiltonian grins at the thought of the next V8 race but argue that the benefit to the city of millions of viewers-in 102 countries throughout the world - seeing the name "Hamilton" printed on the overbridge each time the V8s go down the front straight is considerable - not to mention all the Kiwis watching it live on TV3.

"It's a signature shot," says Whittaker. He hopes that come April, locals will have embraced the revamped V8Supercars event. "If the community aren't proud of the event you are not going to portray to the rest of the country and the world the positive things that Hamilton wants to present. It's a very critical factor to get the community launching the event and embracing it."

He also highlights New Zealand's "enviable heritage" in motorsport and points to three Kiwi drivers on the track-Greg Murphy, Fabian Coulthard and Shane van Gisbergen.

"New Zealand is a massive motorsport heartland. We want to race in New Zealand, there is absolutely no question about that."