The threat to Australia of losing its Formula One Grand Prix would be a dent in the fender of Melbourne's claim as the "Sporting Capital of the World".
Concerns over the financial viability of the prestigious motor race were re-ignited last Saturday February 2 when F1 boss Bernie Ecclestone said it was unlikely that the licence would not be renewed beyond 2010 unless Melbourne agreed to changes.
If Melbourne fails to re-negotiate agreeably, the race will go to either India, Russia or Korea.
"Maybe we don't want to be in Australia," Mr Ecclestone said, reported News Ltd.
"Our costs are very high in Australia and we get a lot less money. It's bloody bad for us.
"We've got quite a few places on the list which would like to have Formula One and as it seems your guy [Victorian Premier John Brumby] down there doesn't want Formula One, we can make him happy and make the other people happy."
Victorian Tourism Minister Tim Holding disputed Ecclestone's claims that the State Government did not support the event. "We think it's a great event, we'd like to see it continue and we'll be working very hard to evaluate it," said Mr Holding on Monday to The Age.
"We don't want to lose it, but we don't want to pay any price for it either," he said. "So it's a balance." Mr Ecclestone has stated that the only way for Melbourne to retain the event would be to hold a night race. But a night race is out of the question according to Australian Grand Prix Chairman Ron Walker.
"We are the best attended formula one race in the world – nowhere else gets 300,000 people to their races," said Mr Walker reported AAP. "Can we go night racing? And the answer is no, it's too expensive [at an additional cost of $60 million], but we made a compromise to start at 3.30 [pm] instead of 2 o'clock, which gives us more viewers in Europe."
Both Mr Holding and Mr Walker indicated that Mr Ecclestone's comments were the beginning of business negotiation tactics employed by the F1 boss.
Mr Walker said the future of the Grand Prix was up to the Victorian Government, but scrapping the event from Melbourne would cost the state millions of dollars and massive worldwide exposure. He claims it produces about $130 million of economic benefits a year, along with vast international publicity for Melbourne.
However, ongoing losses since relocating from Adelaide almost 12 years ago have topped $130 million. The race cost taxpayers $34.6 million last financial year, according to the Grand Prix Corporation's annual report, with an estimated loss of $40 million this year.
Melbourne has long been known as one of the world's leading sporting cities. It was confirmed in a November 2006 report compiled by London-based consulting and research company ArkSports Limited that the Victorian capital is number 1 in sports.
France's capital Paris and Australian rival Sydney tied in joint second place. Berlin, Germany came fourth and London, England, fifth. The analysis indicated the Grand Prix was one of the events that had weighed heavily in Melbourne being crowned the world's top sports events city.
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