Formula E founder and chief executive Alejandro Agag has said the all-electric motor racing series will turn a profit for the first time in 2020.
Speaking during an interview with Reuters, the Spaniard said the championship will be in the black next season owing to increases in hosting, sponsorship and media rights fees, and despite plans to invest more than ever in marketing.
“We are going to have our biggest ever marketing expenditure, many tens of millions,” said Agag. “But even with that spend we are going to show a profit.”
Agag’s comments come with Formula E nearing the end of its fifth season, with the current 13-race schedule set to culminate in New York on 13th and 14th July.
The series, which is backed by the likes of Liberty Global and Discovery Communications, has posted losses in each of its first four seasons. Last year, it made a loss of €26.4 million (US$29.5 million) despite generating a record €133.4 million (US$149.4 million) in revenue, 78 per cent of which came from licensing and fees for hosting races.
Formula E’s losses since its inaugural season in 2014/15 are understood to total more than €150 million (US$167 million).
Nevertheless, according to Agag, Formula E would have already broken even had the series not dramatically increased its spend on marketing and promotion. The series has also invested heavily in new staff and the development of its new car, which debuted this season.
Next year, Mercedes and Porsche will enter Formula E alongside a host of big-name manufacturers such as Nissan, Citroen, BMW, Jaguar, Audi and Mahindra.