A recent Forbes report has revealed that the average valuation of a Formula One team has skyrocketed to $1.88bn, an impressive 276% increase from 2019.
Topping the list of most valuable F1 teams remains Ferrari at $3.9bn, followed closely by Mercedes at $3.8bn and Red Bull at $2.6bn to round out the top three.
There are a lot of factors as to F1’s surge in interest and growth during the backend of the last decade, with the popular Netflix ‘Drive to Survive’ show being one of the key reasons cited as bringing in new eyes to the sport.
The Netflix show proved to be a household success for F1, as it brought in new viewerships in various different markets, in particular the US, where it now runs three Grand Prix races; Miami, Austin and Las Vegas.
The rise in viewership was strongly reflected in the valuation of F1’s media rights, with the estimation increasing from up to $800m worldwide to close to $1bn in 2023.
Forbes cites the cost cap on team spending to be a major benfetting contribution to the rise of valuations. The F1 introduced a $135m cost cap in 2021 to mitigate teams overspending on engines, driver salaries, etc., as overspending proved futile to overall growth.
A source told Forbes that teams will only need to reach roughly $50m of sponsorship revenue to cover the cost cap, which is a highly likely benchmark considering smaller teams make 35% from sponsorships and larger teams 60%, with the rest coming centrally from the F1.
The rise of F1 teams valuations has also no doubt been fruitful for current investors, as Forbes highlights Ineous’ 2022 $850m one-third equity acquisition of Mercedes, with its stake now tripled in value.
The 2023 F1 team valuations below:
- Ferrari: $3.9bn – 2023 Revenue: $680m
- Mercedes: $3.8bn – 2023 Revenue: $700m
- Red Bull: $2.6bn – 2023 Revenue: $510m
- McLaren: $2.2bn – 2023 Revenue: $490m
- Alpine: $1.4bn – 2023 Revenue: $325m
- Aston Martin: $1.375bn – 2023 Revenue: $290m
- AlphaTauri: $1.125bn – 2023 Revenue: $260m
- Alfa Romeo: $900m – 2023 Revenue: $210m
- Haas: $780m – 2023 Revenue: $180m
- Williams: $725m – 2023 Revenue: $160m