After making its presence felt in most key sectors in the global economy, the ongoing financial crisis has now spread its wings into the sporting arena. Even as governments and central banks across the globe are busy doling out stimulus packages, the corporate world, reeling under revenues losses, is pulling out of sporting events – from motor racing to golf – in order to cut costs.
While Japanese carmaker Honda Motors on Friday pulled out from Formula One (F1) as its team?s costs have become too heavy amid deteriorating business conditions, Indian Masters, first-ever European Tour event in India, is in limbo. Another Japanese carmaker Toyota has scaled back the launch of its 2009 F1 car as part of cost-cutting measures.
Even as professional golf in India is teeing off, financial crisis is casting shadow over Indian Masters, the golf tournament with highest-ever prize money in the country at $2.5 million. A source close to the development said the sponsors, real estate major Emaar-MGF are not willing to be part of the tournament. They have expressed their inability to back the tournament slated for February, the source said. ?The decision of the sponsors is not very surprising, considering the current financial scenario,? the source added.
Emaar, which is building the Commonwealth Games Village in the Capital, is bearing the brunt of the economic crisis and earlier this year it had to scrap its initial public offer plans. When contacted, an Emaar-MGF spokesperson said, ?We happened to be the sponsors of the event last year but the promoter of the tournament Golf in Dubai, a Dubai-based company, never approached us for a sponsorship this time. They are the tournament promoters and it was their decision.?
A spokesperson of Golf of Dubai, however, said all is not over just yet and the event may take place as scheduled in February. ?We are making a last-ditched effort and taking to the European Tour to resolve issues and salvage the tournaments. Fate of the event will be decided by Monday.?
Indian Masters is co-sanctioned by European Tour, Asian Tour and PGTI.
Even one of the world?s most popular sporting event is falling prey to downturn. Honda Motors on Friday made public its decision to pull out of F1, owing to global financial crisis. The car major?s decision is fueling fears over the sport?s future during this uncertain times. Media reports had earlier suggested that the carmaker is looking for a buyer for its team and if no buyer is found by the year-end, the team will be closed down.
?This is a complete withdrawal. The future is a blank sheet,? Honda Motor president Takeo Fukui said in a press conference. ?Five years from now, I think history will show we made the right decision.? ?This difficult decision has been made in light of the quickly deteriorating operating environment facing the global auto industry, brought on by the subprime problem in the United States,? Fukui said.