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Villeneuve's Catch 22
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2002.08.21
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Jacques Villeneuve has
always been a very independent character and while this has made him
a popular figure with race fans, it does have its drawbacks. Teams
have never been happy with the amount of promotional work Jacques is
willing to do and now that British American Racing is under a new
management there is a desire to use the money he is due to be paid
to help develop the team.
This makes sense for David Richards, the
new boss of BAR. Villeneuve is good but not good enough to warrant
the kind of money that has been paid in recent years. Richards is
paying considerably less for Jenson Button and could get a nice
cheap deal with Olivier Panis as well. In this way he can save
$10-12m a year and that money can be used to build up the
infrastructure of the team. Once Villeneuve was the key element in
the team in terms of branding. He fitted the rebel image that Lucky
Strike was trying to promote. But now the team is being rebranded
and Villeneuve does not have to be part of that.
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But BAR has made it very
clear to him that it will honor his contract for 2003 if he forces
the team to do so. But if he insists on the deal the team has also
made it clear that there is no chance that he will be employed in
2004 and beyond. BAR is happy to keep him if he is willing to
compromise on money and sign a longer contract but Jacques does not
wish to do this. The danger for Jacques is that if he is seen to be
more keen on making money than making the team competitive it will
undermine his reputation in F1 circles and that will make it more
difficult for him to get a drive in the future. A deal to go to CART
would therefore be a way in which Jacques could get the money he
wants and he should be able to return to winning ways in the United
States. If he wishes then to return to F1 in the future he can do
so.
Gerald Forsythe, the man
who is thought to be offering Jacques a drive, is in an unusual
situation. He is a BAR shareholder as well as running Players
Forsythe Racing (which is half owned by British American Tobacco,
BAR's parent company). In addition he is a shareholder and director
of CART. The involvement of CART is important because the series
needs some help at the moment.
On Tuesday CART stock
dropped to $3.80 before bouncing back to close at $4.00. Until
recently the stock was being traded at $16.00. This means that the
value of the company is around $58.8m despite the fact that the most
recent accounts revealed that CART has assets of around $120m. In
any normal circumstance this would lead to a rush to buy the stock
because, in effect, one is buying something which costs half what it
is worth. But this is not happening and the only logical explanation
of that is that the stock is now held by a small group of people who
are not letting go of their shares and are waiting until other
investors have given up hope and depart. This would then enable them
to take the company off the stock exchange so that they can run it
without the restrictions that listed companies face.
The big issue therefore
is not the stock exchange but rather whether or not CART can
convince teams to stay in the business and to do that they need to
see how the series will recover and how they can all make a profit
in the future. Signing up Villeneuve would do two things: it would
send a message that CART is still a serious choice for a topline
racing driver and it would increase the interest in the series both
in North America and around the world.
Our sources in America say that CART is willing to help pay for the
French-Canadian to join Players Forsythe Racing although Jacques and
his manager Craig Pollock say that they have not received any offer
from Forsythe, which is odd considering that Forsythe has spoken
openly about getting Jacques.
The deal makes sense for
everyone - except perhaps Villeneuve - but unless there is a good
alternative for him in Formula 1 in 2004 it might be wisest for him
to head to the United States.
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