Earlier this year, a Coventry University academic played a leading role in producing a study which highlighted the inherent economic strength of a cluster of more than 4,000 businesses collectively known as the 海角视频’s ‘Motorsport Valley’.
The study, commissioned by the Motorsport Industry Association (MIA), sought to assess how economically robust the sector had been since the recession.
It concluded that this concentration of high-performance engineering firms, located primarily in the Midlands, had emerged relatively unscathed from the recession.
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Collectively, the ‘Motorsport Valley’ cluster enjoyed a period of sustained growth from 2009 onwards, so that by 2012, its combined annual sales had reached £9 billion and its constituent companies employed 41,000 people, mostly in the supply of world-class engineering products and motorsport services.
Commenting on the study’s findings, Coventry University’s Dr Nick Henry said that they were “good news for the motorsport sector and in particular, for the high-performance engineering industry in the Midlands.”
Dr Henry’s observations served to focus attention on Motorsport Valley, an area roughly 80 miles wide stretching from the south west of Birmingham to Norwich, within which eight Formula One (soon to be nine) teams are located.
It is perhaps the world’s finest example of how one sport’s historic development has contributed to a corresponding expansion of high-value businesses and employment.
The process began before the Great War when the British motor industry flourished by producing highly sophisticated, comparatively expensive products.
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Even by 1914, more than one third of cars on Britain’s roads were imported; the mass market was always destined to be dominated by producers such as Ford, while indigenous technical expertise developed what has been referred to, often disparagingly, as a ‘Rolls Royce attitude’.
Yet this attitude was to serve Britain well. By the end of World War II, many aerospace engineers, used to building fast, lightweight planes with which to attack the enemy, began channelling their energies into building fast, lightweight cars to race on the large number of airfields created during the war.
The airfields became race tracks, which naturally attracted individuals and teams that wanted to race; in their wake came suppliers, engineers and designers, such as Robert Herd and former FIA president Max Mosley, who founded March Engineering in the 1960s.
The company built championship racing cars, a range which included Formula One. March’s reputation encouraged engineers into the area and they were soon followed by teams such as Williams, Brabham and McLaren.
Economic historian Andrew Morley stresses the importance of transport links, including the M1 and East Midlands Airport, in attracting Formula One teams.
“The area around Silverstone soon became an F1 hub,” he says. “Initially, teams would travel there to test their cars because it was easily accessible.
“Soon, however, it became evident that if a team or company intended being a serious player in the motorsport industry, it was essential to have a base close by.” Today, eight F1 teams are based within an hour’s drive of each other and what Morley calls “the pool of readily available technical competence” is extraordinarily deep.
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It is estimated that approximately 80 percent of the world’s high-performance engineers live in Motorsport Valley.
The extent to which British motor sport attracts a wide range of suppliers, academics, researchers and entrepreneurs, what economists call ‘the multiplier effect’, can be gauged by examining the numbers of people directly employed by Formula One teams.
Larger teams, such as Mercedes and Red Bull, employ between 600-700 people, while teams like Force India and Sauber have around 300 on their books, around twice the number employed at Banbury-based Marussia. In other words, more than 35,000 people are not directly employed by F1 teams, but work in support industries and, importantly, in R&D. Unlike most other industries, the motor sport sector spends an average of 30 percent of its turnover on research and development, a factor which accounts for the extraordinary success of British-built cars on Formula One tracks around the world.
It is estimated that £3.6 billion of Motorsport Valley’s collective turnover is generated from exports.
Earlier this month, the government launched a £1 million competition for R&D funding aimed at innovative businesses in the motorsport industry. The Launchpad competition, run by the Technology Strategy Board, aims to encourage innovation in Motorsport Valley.
Selected projects will have up to 60 percent of their research costs paid for by the Board, up to £200,000, while the winners will also receive business support and help with external funding and commercialisation.
Universities and science minister David Willetts, said: “This new Launchpad will give some of our brightest companies the chance to strengthen the industry, bring in further investment and keep the 海角视频 as a world leader in motorsport.”
Yet the innovation inherent in creating a winning car can also be applied elsewhere.
For example, McLaren Automotive, which produces luxury road cars, has developed a spin-off, McLaren Applied Technologies (MAT), a business focused on applying F1 expertise to other industries, such as healthcare, but also to other sports including cycling, sailing, canoeing, rowing, bobsleigh and skeleton.
Here, MAT engineers have helped improve equipment and enhanced the way in which athletes approach their training and racing.
On Monday of this week, US businessman Gene Haas announced that he plans to create ‘”more than 250” jobs by basing his new Formula One team in Motorsport Valley.
Acknowledging that it would have been much quicker to sponsor or acquire an existing team, Mr Haas said he prefers to start a new entity from scratch.
He has enjoyed considerable success doing something similar in the States, where, in 2003, he founded Haas CNC Racing to compete in NASCAR. In 2009, the team name changed to Stewart Haas Racing after former Sprint Cup Series champion Tony Stewart invested in the team.
Mr Haas’s decision to locate to Motorsport Valley was determined by the area’s existing concentration of F1 teams and, importantly, the availability of personnel.
“Ownership (of a Formula One team) is really the only way to enter the sport in a practical fashion for my company,” said Mr Haas.“I could have spent $100 million in advertising and I don’t think I would get as much bang for the buck as I would in Formula One.
“If we can associate Haas Automation with Formula One, it becomes a premium brand and a premium brand is the Holy Grail of marketing.”
This week’s developments mean that once Haas Automation has opened, three-quarters of Formula One teams will be based in Motorsport Valley.
This thriving, sports-related hub looks set to create even more employment and generate considerably more inward investment; it’s economic importance cannot be under-estimated.