For those who are savvy, it is well know that professional car racing can lead to big dividends. And that’s exactly what American business man Gene Haas is hoping for. Forbes has reported that Haas has announced plans to launch his own Formula 1 racing team in the hopes of boosting the sales of his machine tooling company. He is so optimistic in fact, that he expects the move to bolster revenue by $2 billion in the next five years.
It is the only reasoning behind the go ahead decision given by Haas to pursue the creation of a team. F1’s chief executive Bernie Ecclestone, has estimated that running a F1 team will cost approximately $1 billion dollars after four years of operation. Therefore, Haas is hoping to come away with a nice billion dollars in profits by the time the five years comes to a close. Still, it’s one of the more expensive ways to advertise.
Forbes quoted Haas as saying, “Our five year plan is to double our sales from one billion to two billion a year. About 50% of our production is sold in the United States and we sell about 50% overseas but in terms of overall markets, the US consumes five or six billion dollars a year whilst the rest of the world is 80 billion dollars a year.” Haas hopes to see a 50% to 70% increase in profits as a result of the F1 team, set to launch in 2016.
He goes on to tell Forbes, “I need to penetrate not only Europe and South America but China and Asia. These are all these markets that we have a tough time even getting any kind of notice in and they really like Formula One.” Haas mentioned that China is the largest market that his company has yet to gain solid footing in, and he hopes that a shared love of racing will help him bridge that gap. He also noted China’s deep love of brands as another key component for his infiltration of the country’s market.
Haas already has the resources to take on such an ambitious task. His company, Haas Automation, will be a main player in providing resources for the F1 team. He has also already signed Guenther Steiner, a former technical director of F1 Red Bull Racing, to act as team principal.
Still Haas has his work cut out for him. In the end only time will tell if Haas Formula has what it takes to be a champion.
Photo: AP Photo/Chuck Burton