• Australian Grand Prix

Melbourne set to ditch Australian GP?

Albert Park and the Australian Grand Prix ... on borrowed time? © Sutton Images

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Not everyone welcomes the Formula One roadshow when it hits town, and Melbourne's Lord Mayor, Robert Doyle, has said that when the current contract to host the Australian Grand Prix expires in 2015 it should not be renewed.

Doyle told the Herald Sun that the cost to the city allied to the massive inconvenience means it's a price no longer worth paying.

"In 1996 when the race was a combination of a four-day event and corporate sponsorship was far more generous than it is today, the race still needed to be underwritten by about A$1.7 million (US$1.68 million)," he said. "Last year it was $50m.

"Fast forward to 2015 … though the documented benefits for the city may include hundreds of millions of dollars of advertising value, tens of millions of dollars of local revenue, an event that will draw between 250,000 and 300,000 people over three days will come at a cost that will approach A$70 million taxpayer dollars. It is the old argument: pay up front but get many times the value of the upfront payment in downstream economic benefits. For most events that formula is persuasive. But A$70 million?"

Doyle said Melbourne could just turn its back on the event. "I know of no city that has voluntarily walked away from a grand prix, but could Melbourne be the first? The final possibility is that we decide that it has been 20 fantastic years, the benefits to the city and the state have been enormous, but the cycle has run its course. My judgement would be: Get ready. Time's up."

The future of the race at Albert Park has been increasingly under the spotlight in the last couple of years, mainly because of the increasing burden on the taxpayers. The 2010 loss amounted to A$49.2 million, more than double the loss of 2006. Doyle's comments seem to indicate patience with the escalating financial demands of the Formula One moneymen could have become unacceptable.

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