Branson and Ecclestone

Curious one this.

Late last week, it appeared that Sir Richard Branson's Virgin Group were on the verge of buying the Honda Formula 1 team. Bernie Ecclestone, in particular, seemed to be very keen on the idea:

"I've spoken to Richard's people about it. He would love to do it.

"I'd like it very much. It would be super. We're working to try to make it happen."

Ecclestone even added some glowing personal praise of Branson:

"He’s exactly the type of person we would want in the sport...Sir Richard Branson is a wonderful guy. I met him at Monza last year and we got on very well."

By Saturday morning, however, Branson was giving interviews to the BBC, criticising the financial structure and environmental credentials of Formula 1:

"If Bernie Ecclestone can make it more cost-effective for the likes of the Virgin brand to come into the sport, and if he can champion clean motor-car racing - which is possible to do by making sure all the cars run on clean fuels - then at some stage we might be interested in getting involved...I think there are faults that would need to be rectified before we could go into F1."

By Monday morning, Honda announced that they have been unable to find a 'serious' potential buyer of the F1 team.

If we take this Honda statement at face value, and assume that it is not merely some complex negotiating ploy, and that the Virgin Group were indeed never seriously interested in purchasing the Honda F1 team, then one might be tempted to think that Branson has taken Bernie for a ride. The public perception will be that Branson took a look at Formula 1, found that it was too costly and insufficiently eco-friendly, and turned his nose up at the opportunity. On the plus side for Branson, he gets free publicity for the Virgin Group, and in particular, for their plans to fly 747s powered by biofuels. On the negative side, Branson potentially enrages a powerful fellow billionaire.

This incident, of course, takes place in the midst of continuing negotiations between the Formula One Teams Association (FOTA) and Bernie Ecclestone, to increase the proportion of Formula 1's commercial revenue which goes to the teams, rather than the private equity company, CVC, which owns Formula 1. Moreover, Max Mosley has made it his post-scandal purpose in life to make Formula 1 both cheaper and greener. In any future negotiations with Bernie, both FOTA and Max Mosley will be able to deploy the following rhetorical lever: 'Look what happened when Richard Branson tried to get involved in F1. He wanted to participate, but found the sport too costly and insufficiently green. We need to change.'

It'll be interesting to see what Bernie's got to say about Branson now...