I was disappointed to learn this week that the draft 2011 world rally calendar doesn’t include the iconic Rally of New Zealand. The official position of RallyNZ appears to be to wait until the draft schedule is confirmed, but it now looks unlikely we’ll make it.
I was particularly disappointed to learn that the government had turned down backing for the event. This week Gerry Brownlee was trumpeting the fact that the government was sponsoring the World Paralympics Athletic Championships, so I asked him why he wasn’t backing Rally New Zealand. In response he questioned the economic benefit of the event.
The world rally championships is a huge international event, bringing huge TV audiences and offering considerable tourism potential. Media reports suggest those involved in the motorsport industry feel other governments give better backing to the event, no doubt that played a part in our being excluded from the 2011 schedule.
Major sporting events bring huge economic benefits to New Zealand. While we’re all focused on the Rugby World Cup, we’d be mad to overlook events like the Rally of New Zealand, which appeals to a very different (and possibly bigger) international audience.
It’s a shame alright.
The National Party questioning the economic benefit of cars..?
I almost fell of my chair at that one…
At a guess, much better cost/benefit ratio than the
RWC, and at far less $ cost.
We are inclined to over-estimate rugby’s worldwide audience.
The works rally teams, supporters, and the TV coverage….big numbers.
Brownlee’s wrong. The WRC has arguably the biggest economic benefit of any sporting event held in New Zealand.
That said, if that were the sole reason for government funding then the previous labour government would have turned down funding for the America’s cup and given it instead to the Rally of New Zealand. The return on the investment would have been far higher.
Glass houses guys.
Chris is wrong here I think.
If you look at the history of the event, New Zealand has been sharing hosting rights with Australia since 2008. The 2009 edition of the WRC was held in Australia, the 2010 edition is to be held here and in 2011, it is going to Australia.
It was never going to be held here in 2011.
Further, the Major Events Fund ceased funding Rally New Zealand following the 2007 event. This was during the last Labour administration and about the same time as the WRC decided New Zealand and Australia should alternate hosting rights.
Nice try though.
Further. The economic impact of the WRC in New Zealand isn’t very high.
The main reason for that is that we are not very good at motorsport.
The true value for government sponsorship of events like this comes from when NZ talents and ingenuity are showcased, like for exmple the Americas Cup.
With events like that, not only do we get the tourism promotion but we also get a showcase for our world-class marine industry.
The WRC doesn’t showcase anything (we don’t make cars) and so I think this is where the lack of value comes from.
Maybe its because the benefit happens outside Auckland? Not to suggest the MP for the “westies” cant make it this year.
I heard Gerrys answer and it was pathetic! This is a big event and it deserves sponsorship and support. For goodness sake, look at how much money we have poured into other sports over the years – Gerry was a disgrace and he should be ashamed of his smart alex answers and smarmy ‘I know better than you’ attitude.
One wonders what the economic benefits were for the Paralympic event given thats the reason for not backing the Rally…
The economic benefits for sponsoring the World Paralympics Athletic Championships aren’t huge. However, there is an obligation to sponsor events that don’t attract major corporate backing as easily as more fast-paced events like the WRC. Otherwise events like that wouldn’t even get off the ground.
Good post Chris. If we ever get to the point of not getting the rally because of Key’s inability to see big picture and look at economic impact reports then our economy will suffer pretty badly. It is a symptom. Smiling and waving is not enough.
The ten million for the America’s Cup would be welcomed by Rally NZ I am sure. The biggest advantage Rally has is no one expects to watch it live… it is over several days and is therefore screened at convenient times in home countries. Unlike F1 which demands a start and finish time in line with Northern Hemisphere schedules.
Rugby has this problem also.
Motorsport and in particular Rally are HUGE in Europe. I guess no one in this government fancies sitting beside a dusty road for a photo opportunity when they could be in a corporate box or on a super yacht instead.
I have to take issue with Dog on Nz not being very good at motorsport. If the old” per head of population ” argument is used we are with the probable exception of Finland way out in front. The major handbrake is money of course. The roll call of Kiwis currently world ranked is probably greater than in any other sport that we participate in. The TV picture coverage of the NZ Rally and countryside that goes around the world is worth 10s of millions of dollars for tourism, and a lot of the technology associated with that coverage is generated in real time in Dunedin.
Adrian,
what I am talking about is New Zealand’s ability to promote its products and services in the motorsport industry.
It is one thing to have a handful of players at, or near, the top of the game but it is quite another to derive a percentage of GDP from the sport. This is where the value (or lack of, in the case of Rally NZ) comes from.
The marine industry in New Zealand, for example, contributes more than $535 million in exports from a total industry worth $1.8 billion per annum.
The Rugby World Cup in 2011 is estimated to result in $476 million of total direct additional expenditure within
New Zealand. It is also estimated to provide the New Zealand Government an additional $112 million in tax revenue.
By comparison, while there are no figures available for New Zealand, Brisbane firm Conics produced a report in 2009 that estimated the value of the Australian WRC event in 2009 (remember we alternate with Australia and that there was *never going to be a 2011 WRC Rally New Zealand*) at $31 million. Events New South Wales take an even dimmer view estimating the event to be worth $20 million p/a.
On top of this, Australia has an exporting automotive industry. New Zealand is a net importer of automotive products and services.
When people talk about television coverage of the New Zealand countryside, there are dozens of sports which promote New Zealand as a tourism destination.
Trevor,
“not getting the rally because of Key’s inability to see big picture”
This is just plain wrong for the reasons I outlined in my previous posts.
Dog, I see what you mean, there have been cost/benefit studies done in the past for the rally but I don’y know how recently.It would be interesting to see what the overall motorsport industry is worth.I suspect that on forex matters it is probably negative, but internally it is quite a big employer. On the weekend though I watched the Luptons spectacular Unlimited hydroplanes and they export a number of NZ built boats and they can cost half a million each, along with the specialist car builders and rebuilders the results of such a study might be pleasently surprising.
While there are other sports that promote NZ as a tourist destination, I don’t think any of them have the international profile or audience of the WRC.
I think it’s kinda sad that everything has to be boiled down to economics and percentage of GDP though. These are not the only indicators of the value of an event.
I think the value the WRC comes largely from “brand awareness” (ugh, sorry but I can’t think of a better term) of New Zealand as a whole. Unfortunately, it’s pretty difficult to quantify the value of this in any meaningful way.
The big thing that people are missing here, which is understandable if you haven’t followed the sport, is that the new calendar will NOT be a rotation. If New Zealand are not on the 2011 WRC calendar, that will be it, game over. It would be very hard to get it back, as the basis for gainning a WRC event is made on the figures of previous events.
The World Motor Sport Council will decide on the new calendar on the 11th of March, Rally New Zealand have only until then to drum up government support.
Rotation calendars like the one we have seen in the last couple of years have been run before, but ultimately the WRC has gone back to a set yearly calendar. This is easier for the manufacturers in terms of audience and easier for the countries running the events as they can have set infrastructure and organisation to get the events going on a regular basis.
All I can say is fingers crossed we can have something more to offer WMSC and WRC global promoter North One Sport in the next few days. Otherwise we’ll have to make the last Rally New Zealand this May, the best damn WRC event of the year.
[...] I noted previously, the Rally has a large international following and could have great spin-offs for tourism and other [...]