Max Verstappen clinched his fourth straight drivers’ championship Sunday at the Las Vegas Grand Prix. It was not like the runaway titles of the last two seasons, when the Red Bull driver posted a combined 34 race wins; he’s won eight in 2024. And with two races left in the season, there’s still a three-way battle for the constructors’ title between McLaren, Ferrari and Red Bull.
Yet, in the world of F1, everyone is already a winner in 2024.
The 10 teams are worth $2.31 billion on average, up 44% from Sportico’s previous F1 team valuations in June 2023. Ferrari leads the way at $4.78 billion, followed by Mercedes ($3.94 billion) and Red Bull Racing ($3.5 billion), based on our calculations and interviews with those knowledgeable of F1 finances, including team executives, sports bankers, attorneys and investors.
Every F1 team is worth 10 figures for the first time, with Haas in 10th at $1.02 billion. F1 joins other sports properties where the “get-in” price has hit $1 billion over the past decade, including the NFL (2015), NBA (2018), MLB (2019) and NHL (2024). As for soccer, you can still buy the majority of teams in each league around the world for less than $1 billion.
The race grid will soon get a bit more crowded. On Monday, Formula 1 announced an agreement with General Motors and its Cadillac brand to join the race series as the 11th team starting in 2026. It is the first F1 expansion since 2010.
F1 has been transformed under Liberty Media, which bought the race series in early 2017 for $8 billion, including debt. Owning an F1 team used to be a license to light money on fire, and teams bailed out when the red ink was no longer palpable. Last decade, Caterham, HRT and Manor Racing all shut down their teams. In 2015, Renault bought Lotus for a symbolic £1.
“We’ve tried to take really a page out of, I’d say in some ways, the NFL in the United States: Compete hard on Sunday, but on Monday [it’s] league first,” Greg Maffei, Liberty Media CEO, said at a May Autosport Business event in Monaco. “We really want to grow the sport together. The teams have embraced that, and profited from that, because they’ve not only seen the growth in F1 revenues and their share of the profits in their own sponsorship, but we’ve also seen growth in the value of teams.”
Racing for Dollars
Liberty has broadened the appeal of the sport through its popular Drive to Survive series and an expanded race schedule that also includes additional shoulder programming on race weekends to attract more than just race fans. In Singapore, there were 100 hours of live entertainment beyond the racing, including concerts by Kylie Minogue and Lenny Kravitz. In Austin, over 100,000 fans came to see Eminem perform. Race attendance has also jumped from 4.2 million in 2018 to an expectation of more than 6 million this year.
The moves have shifted the F1 fan base younger—42% under 35 years old—and more female, with women representing 42% of fans. It has helped sponsorship revenue double to $632 million at the corporate level during the past five years, and American Express, Lenovo, LVMH and Santander are joining as F1 series sponsors in 2025.
Liberty Media has benefited from the race series advances, as the stock rose 33% over the past year. The enterprise value of $22 billion is 175% higher than the 2017 purchase price.
The gains on the team level are even better. Five years ago, the get-in price for an F1 team was roughly $100 million. Today it is 10 times that.
The 10 teams generated a combined $3.8 billion in revenue last year, up 16% versus 2022. Mercedes ($680 million) led the way and made more than four times what Williams ($158 million) did. The two main buckets for revenue are sponsorships and the prize fund. American brands have flocked to F1, incuding Dell, Goldman Sachs and Google partnered with McLaren. Red Bull’s sponsors include AT&T, ExxonMobil and Oracle.
Perhaps the most fundamental change that has altered how F1 teams are valued is the introduction of cost caps, which were introduced in 2021 at $145 million per team—driver salaries, travel, marketing, legal and certain other costs are excluded from the cap. In previous years, bigger teams would spend more than twice that cap.
The cap provided title hopes for teams beyond Ferrari, Mercedes and Red Bull, who have captured 23 of the past 26 championships. It also improved profitability across the grid. In 2018, McLaren, which has a narrow lead in the current constructors standings, lost $137 million. Last year, the team turned a $38 million operating profit, with bigger gains expected in 2024. Fully 80% of the teams turned a profit last year.
The cap moved F1 closer to the NFL and NBA models, and investors have started looking at F1 teams on a revenue multiple basis, akin to how clubs in North American sports leagues are viewed. Formula 1 teams are valued at 6.1 times the revenue on average, up from 5.1 last year and ahead of the top global soccer clubs, per Sportico’s calculations. It still lags the NBA (11), NFL (9.3) and MLB (6.5), but the gap is closing.
F1 teams also benefit from the scarcity of these global assets. There are only 10 teams, versus 30 or more in major North American sports leagues, and even fewer of them are open to outside investment—our valuations are based on control transactions, versus limited partnership investments.
Last year, RedBird Capital Partners and Otro Capital led an investor group that paid $218 million (€200 million) for 24% of the team. The Otro investment included actors Ryan Reynolds, Rob McElhenney and Michael B. Jordan. Portuguese firm Apex Capital also joined the Alpine cap table, in conjunction with sports stars Patrick Mahomes, Travis Kelce, Anthony Joshua, Alexander Zverev and Rory McIlroy.
“Formula 1 used to be more of a European sport before it became truly global over the last few years,” Antonio Cacorino, Apex Capital CEO, said in a video interview. “Liberty has found the proper balance of keeping the heritage and history of Formula 1, but also opening it up to the world and commercializing it.”
This fall, Aston Martin added new two institutional owners in investment firm HPS Investment Partners and Silicon Valley venture capital giant Accel, which was an early investor in Facebook. The LP investment valued Aston Martin at roughly $2 billion, a major step-up from Arctos Partners’ investment in Aston Martin last year. Principle owner Lawrence Stroll has invested heavily in the race team, and it is expected to get a boost next year with the addition of Adrian Newey, whose car designs have been behind 12 constructors titles, including six since 2006 at Red Bull.
What’s Next?
Last year, Liberty and the International Automobile Federation (FIA) considered adding an 11th team to the race series and had at least four parties express interest, led by one from Michael Andretti. Ultimately, Liberty and FIA did not approve any of the bids. One concern was the slot price of $200 million, which was established by the last Concorde Agreement that governs the sport. It was signed in 2020 before the recent surge in valuations. Another issue was logistics. Space for 10 teams is already tight at several tracks, such as Monaco. Finally, there were people in F1 that did not want Andretti in the sport.
The governing bodies pivoted and accepted a revised bid led by General Motors after Andretti stepped down from his eponymous firm in September. The GM bid includes backing from Dan Towriss and Mark Walter. Towriss is the CEO of Group 1001, which owns financial services company Gainbridge, and he took control of Andretti Global when Michael left the firm. Walter is the CEO of financial services firm Guggenheim Partners and is the control owner of MLB’s Los Angeles Dodgers and co-owner of Premier League club Chelsea.
No financial details were disclosed, but the BBC reported the anti-dilution or “expansion” fee would be $450 million and more than double the price in the 2020 Concorde Agreement, which expires after the 2025 season. GM will also be on the hook for hundreds of millions of dollars in startup costs to join the grid in 2026.
“With Formula 1’s continued growth plans in the US, we have always believed that welcoming an impressive U.S. brand like GM/Cadillac to the grid and GM as a future power unit supplier could bring additional value and interest to the sport,” Maffei said in a statement.
Expansion forces teams to carve out an extra slice from the Prize Fund, which was $1.2 billion in 2023. F1 is broadcast in 200 countries, and the U.S. represents 10% of the TV revenue, but a much smaller percentage of the global TV audience, which averages 85 million fans per race, including streaming.
The team payouts will receive a boost from upcoming TV negotiations. Viewership on ESPN has leveled off, with the average hovering around 1.1 million per race, but that is double the viewership from 2018. ESPN pays roughly $85 million per year in a deal that expires after the 2025 season, and the expectation is the new deal will carry a hefty increase.