How Money is Generated in Formula 1 and than Distributed ?

Formula 1 revenue generation 2014

Formula 1 comes with its glitz and glamour and the ultimate racing test of drivers, their is no competition for Formula 1 in their sport and they enjoy great broadcasting rights deals, sponsorships and some other rights like (F1 game, official sponsor LG etc) We will try to illustrate how the money is generated in Formula 1 and how it is divided into prize money and distributed among stake holders like circuits, drivers, teams and even in some cases governments.

A general chart showing revenue flow in formula 1 stake-holders ?

Formula 1 broadcast money distribution (2)

Of course the exact amount of money in each part of bracket is unknown, teams do disclose their after tax earnings every but where and how much the money comes from is never disclosed. But here is a little information about Formula 1 revenue stream.

FORMULA 1 PRIZE FUND & DISTRIBUTION:

there is also a huge prize fund from which all 10 teams gets big chunk of money. Which is distributed according to 2009 Concorde Agreement. Take a look at some of the points in the contract.

  • The F1 Prize Fund is made of 50% of the revenue, which is around $600 Million.
  • Team Ferrari has a special agreement which nets them 2.5% of overall fund plus the usualy money according to where the team finish.
  • The prize fund is divided into two parts.
  • First part is distributed equaly among all 10 teams, which is around $30 Million for every team.
  • 2nd part is divided according to where the team finish. Red Bull made more than $75 million last year from prize fund money.
FORMULA 1 TEAM PRIZE MONEY
STAGE MONEY
World Champions $47 million
Runner-Ups $40 million
3rd Place $32.5 million
4th Place $27.5 millon
5th Place $25 million
6th Place $21 million
7th Place $28 million
8th Place $15 million
9th Place $12 million
10th Place $10 million

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Source: tsmplug.com
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