3 August 2012
Loan gives Nurburgring temporary reprieve
Cash-strapped Nurburgring receives €254m government loan guarantee and sets sights on 2013 F1 race.
The beleaguered Nurburgring appears to have earned a reprieve, albeit temporary, after an injection of government funds staved off the threat of imminent closure.
The legendary German venue was last month reported to have moved closer to the axe after the European Union's refused to a bail-out that would prevent the facility from tumbling into administration. According to the Rhein-Zeitung newspaper, the money - rumoured to have been around €13m - was to have been used to service interest on a €300m loan received from the state-owned Bank of Rhineland-Palatinate.
Now, however, the Rheinland-Palatinate regional parliament appears to have come to the rescue as, according to Frankfurter Allgemeine, its budget committee has approved a €254m loan guarantee, which will allow the circuit to continue operating while servicing its existing debt and continue operation. That, of course, will be good news for next year's German Grand Prix, which is due to return to the Eifel region as part of the existing date share with Hockenheim, which hosted this year's event just a couple of weeks ago.
Approval of the loan did not apparently come easily, with the opposition Christian Democratic party voting against the motion, believing it to be illegal, and calling for the resignation of Social Democratic Party president Kurt Beck and several other ministers. Beck has backed proposals to transform the historic circuit into a bigger tourist attraction, and has already assured voters they would not be financially liable for the redevelopment, but it was these plans that began to tip the 'Ring over the financial edge. Beck's SPD, and the Green party with which it shares a coalition, used their majority to push the loan through despite the objections of the CDU, which claimed that extending the existing loan contravened EU rules.
"I am very optimistic that the F1 race will go ahead next year at the Nurburgring," circuit director Jörg Lindner commented, "The aim now is to conclude a contract with Mr Ecclestone."
F1's commercial supremo had previously been linked to the possible purchase of the Nurburgring, but dismissed the rumours, suggesting that the circuit itself was not for sale. Ecclestone has regularly admitted that Germany should not be lost from the calendar having, until recently, enjoyed two races a year, and, prior to the latest developments at the 'Ring' suggested that the 2013 race could switch to Hockenheim, despite the venue also struggling financially. It was the fact that neither circuit wanted to afford the cost of hosting a race annually that prompted the current date share.
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