Tobacco Sponsorships A Fine Example Of Why FTX-Crypto Crash Will Leave F1 Untouched

The recent crypto crisis sent shockwaves through the world as billions of dollars were at stake. Around $8 billion liquidity crunch sent panic throughout the monetary sector, in which F1 had to suffer its bit. However, Zak Brown feels Formula 1 will do absolutely fine despite the crisis. He further explains with an example.

Back in the day, tobacco sponsorships were crucial to the teams, as they had a very important impact on the F1 economy. However, after these brands were no longer allowed to sponsor teams, the sport still lived on.

Talking about this, McLaren honcho shared, “I think every time there’s been a shift in the sport, there’s, ‘oh my, what’s going to happen when the tobacco money leaves the sport? What happens when this manufacturer leaves the sport?”

“But the sport is so strong that it seems always to be someone there to step in. So it would be unfortunate if there’s a lot of impacts, but I think the sport is just fine,” Brown further stated.

READ MORE: Amid Recent FTX Hit, Mercedes F1 Could Take Another Financial Blow as $2 Billion Worth Sponsor Pushed to End Partnership

The crypto crisis took the hardest toll on Mercedes as they had to part ways with FTX, one of the biggest players in the crypto market who had to declare bankruptcy.

What exactly happened with tobacco sponsorships?

The FIA, Formula 1’s governing body, decided to ban every form of tobacco sponsorship and advertising by the end of 2006. The governing body decided on it in 2001 after the World Motor Sport Council voted for the ban.

The decision was supposed to take a heavy toll on the teams as the tobacco companies splurged as much as $350 million a year in F1. Five teams ran tobacco advertising in 2001. They were Ferrari (Marlboro), McLaren (West), Jordan (Benson and Hedges), Benetton (Mild Seven), and BAR (British American Tobacco).

The tobacco companies were an integral part of revenues on Formula 1, as well as the World Rally Championship. However, as per the decision made by the FIA, these advertisements were banned and hence the money surge stopped. This, however, didn’t stop the teams from getting other sponsors.

WATCH THIS STORY: Rich History of F1 races in Las Vegas Throughout the Years

Even after all of this, the tobacco companies still have a connection with the F1 world. Through E-cigarettes or vapes, these companies have managed to keep ties with F1. One big example would be McLaren and their sponsors Vuse, a global vape brand. Should such brands be allowed to be associated with F1 and the teams?