The Real Reason Behind Ferrari’s $500 Mn Investment in Lewis Hamilton Revealed: “Billions to the Company”

Lewis Hamilton to Ferrari. That’s all everyone is talking about. The pre-season buzz has been masked by the big news dropped by the Briton driver. After being seriously committed to Mercedes, Hamilton has decided to move on, leaving Toto Wolff heartbroken. But this was because Wolff did not value the relationship, and Ferrari showered Hamilton with attention before he even joined the team.

Ferrari is putting in the big bucks for the 7-time world champion. Promising to invest approximately $500 million in him. But while it looks like a great deal for Lewis Hamilton, Ferrari will transcend 10 billion. How? Let’s take a look.

Win-win for Ferrari

By this point, although Lewis Hamilton is still with Mercedes, it’s okay to call him a part of the Ferrari family. So far, only the inauguration has begun and the future looks bright for the two parties. Ferrari gets an iconic driver and Hamilton moves to a legendary team. And both get a lot of money. Broken down by sports journalist Joe Pompliano, who has put out a video talking about how investing $500 million in Hamilton will bring “Billions to the Company.” And here’s how.

In the video, Pompliano explains Hamilton’s move to Ferrari and how the relationship is co-beneficial. He says “It’s been reported that his (Hamilton’s) new contract with Ferrari is a multi-year deal with over $100 million annually, a substantial raise from his current 2-year $125 million contract at Mercedes.” But beyond the salary raise, he explains the brand ambassador deal and says, “And Ferrari Chairman John Elkann essentially wrote Lewis a blank check committing over $400 million to Hamilton’s business projects and charitable initiatives outside of Formula 1.”

Read More – Lewis Hamilton Reveals Mercedes Is “Going Backwards” After Shock Ferrari Move

Stating stats from stocks and social media, Pompliano explained, “This news, combined with an impressive earnings report set the stock 12% higher that day. The luxury car company added over 10 billion dollars to its market cap, and its shares are now trading at an all-time high. Ferrari also got 232,000 followers on Instagram in just 24 hours. And the news garnered over 500 million impressions, worth 13 million dollars, according to Zoom.”

This is exactly how impactful Lewis Hamilton is on a brand. But if this is the amount of traction his move to Ferrari has generated, what was the case when he joined Mercedes back in 2013?

How did Lewis Hamilton affect Mercedes?

Factors like Liberty Media’s cost cap implementation have contributed to Formula One’s overall growth, but Hamilton’s influence remains undeniable. Formula 1’s valuation has skyrocketed from $389 million in 2013 to $3.8 billion, an 877% increase, making Mercedes the second most valuable team in the process.

Toto Wolff‘s equity stake in the Mercedes F1 team, acquired for $30 million, is now valued at over $1.1 billion. All of this happened during the Lewis Hamilton reign, along with Mercedes taking advantage of the 36 million followers of the driver on Instagram. Having the World Champion in the team has helped the team bring in sponsors, sell cars and merchandise along with increasing their presence in the world.

Read More: Lewis Hamilton Reveals Mercedes “Can’t Get Much Quicker” Ahead of Shocking Ferrari Move

That being said, do you think Ferrari did the right thing by deciding to give Lewis Hamilton half a billion dollars to drive for them? Let us know your thoughts in the comments below.