Formula One Manufacturers Hold Out Against Ecclestone (Update1)

Jan. 26, 2005; Bloomberg reportesd that Honda Motor Co. and Toyota Motor Corp. have given support to three other Formula One manufacturers who are threatening to stage a rival motor-racing series, a week after Ferrari SpA's decision to tie itself to rights holder Bernie Ecclestone until 2012.

Honda, Toyota, DaimlerChrysler AG's Mercedes-Benz AG arm, Renault SA and Bayerische Motoren Werke AG agreed to a ``comprehensive set of governing principles'' for the sport beyond 2007, when the Concorde Agreement that details the current rules expires. Ferrari, the richest of the 10 Formula One teams, last week became the only team to extend the accord.

The group wants a ``significantly greater and more equitable share'' of the sport's revenue, the auto manufacturers said in a statement. And in a swipe at Ferrari's decision to act independently, the carmakers demanded that ``all stakeholders deal with each other,'' the statement said.

Under the Concorde Agreement, the teams currently get about 30 percent of the $1 billion that the sport makes annually in sponsorship and television revenue. BMW, DaimlerChrysler and Renault have said they will start up the Grand Prix World Championship unless the teams and get more. Honda owns 45 percent of the BAR team, while Toyota runs its own team.

Criticizing the web of trusts and investment vehicles through which Ecclestone controls F-1, the five manufacturers said they sought transparent governance for the sport and a professional management team with clear succession plans.

Ecclestone, 74, began to manage Formula One television rights in 1981 and his companies now organize everything from where races are held to corporate entertainment. He has never publicly stated who would run the sport when he dies.

The U.K. billionaire is currently embroiled in a legal tussle with Lehman Brothers Holdings Inc., Bayerische Landesbank and JPMorgan Chase & Co. over who has control over some Formula One management companies. The banks acquired their holdings in an Ecclestone trust after he sold a controlling stake to German media company Kirch Holding GmbH for $2 billion. Kirch collapsed in 2002, and the banks took over the stake in return for the money that Kirch owed them.