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State Government Backs Jerez de la Frontera Circuit – Ensures MotoGP Racing Through 2016

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The 2011 MotoGP Championship heads to Jerez, Spain this week, as the premier class gets ready for its second race of the season. 2011 so far has been a tough year for motorcycle tracks. First there was concern over whether Donington Park would get FIM homologation in time for World Superbike’s visit (spoiler alert: they did).

Then there was concern over New Jersey Motorsports Park, which filed for Chapter 11 protection, as the east coast venue sorts itself out financially with its creditors. MotoGP hasn’t been immune to this issues as well, as both Brno and Jerez have seen some concern of their future outlook.

While Brno is looking for help from the national government to make the dollars and cents make sense, Jerez was in a similar predicament except that the track has missed its last loan payment, and had its assets frozen my a local magistrate. Concerns over Jerez can now be put to ease though as the Andalusian State Government has announced that it will underwrite the popular Spanish racing venue through 2016.

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Racing

Brno Needs National Support for 2012 MotoGP Race

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The times are certainly tough race circuits right now. On the MotoGP roster the Hungarian Balatonring has become almost the unicorn of the paddock, while the Jerez de la Frontera Circuit is in financial crisis. Similarly back home in the United States, New Jersey Motorsports Park is going through a bankruptcy proceeding that should see the track come out unscathed, but frames the picture nicely none-the-less (not counting the increasingly popular Motorland Aragon).

Add to this list now the Automotodrom Brno, as the Czech track is facing financial concerns of its own. While the Brno round is secure for the 2011 season, talk is beginning if the track can operate in the 2012 season without national support. While the Czech GP brings in substantial revenue for the area surrounding it and the Czech Republic as a whole, the latter entity gives virtually no support to the racing event.

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News

Zero Motorcycles Gets $17 Million Investment

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Using strictly the Charlie Sheen sense of the word, Zero Motorcycles is WINNING right now. Announcing today that it closed another round of financing, Zero has $17 million of a $26 million round confirmed ($9 million still outstanding). The funding continues to be lead by the Invus investment group, who have been the major financial backbone at Zero Motorcycles. A funding round of that size can only mean one thing for a motorcycle company: going into mass production. Surely enough Zero states its intended use of the funds will go towards ramping up its US-based production plans.

Out of all the electric motorcycle vehicle players, Zero has been the most active in the funding department lately, closing round after round of capital investment. With those investments we’ve already seen changes at the Santa Cruz company, with the 2011 Zero Motorcycles line-up featuring upgrade motorcycles, as well as founder Neal Saiki departing the company.

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Racing

Jerez de la Frontera Circuit in Danger of Closing

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Spanish fans might get short-changed one of their four MotoGP rounds this year, as news comes that the managing group of the Jerez de la Frontera track has hit financial troubles. Missing a €2.5 million payment to the city of Jerez, courts have frozen Cirjesa’s assets (the company that oversees the circuit’s operations), which includes its payment to Dorna to host the Spanish GP round.

Jerez de la Frontera incurred these costs after re-vamping its facility back in 2005, a move which was financed by the Spanish city and other financial backer. With the land valued at €17 million, there is plenty of equity in the circuit to make good on the outstanding payment, and it looks like the city is eyeing the surrounding property for recompense on some of the full debt amount.

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Banter

5 Interesting Facts from Harley-Davidson’s Annual Report

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While we’re still poring over Harley-Davidson‘s annual report, making Excel spreadsheets, and winning at bullshit bingo, a couple interesting facts have struck us about the company and some of the trends it is experiencing. While it’s been mostly doom and gloom around Harley-Davidson in 2010, the Milwaukee-based company does appear to be solely in business because of the strong cost-cutting CEO Keith Wandell has been able to achieve during his tenure. Despite the moaning and groaning from the Bar & Shield loyal about Wandell’s non-motorcycle riding lifestyle, the CEO knows how to trim the fat, which is exactly what this HOG needed. Find five interesting facts for you to mull over this weekend after the jump.

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Former Vice Chairman of GM Bob Lutz Drops $1.5 Million Investment into Electric Scooters

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Current Motors (clever name) of Ann Arbor, Michigan just got a healthy cash infusion, as General Motors’s former Vice Chairman (and avid motorcycle collector), Bob Lutz, just dropped a check off for $1.5 million to the electric scooter manufacturer. While money is well and good, and we imagine the folks at Current are more than amped (oh yes, we just did that) about getting money during these tough capital-raising markets, the real electrifying news here is that the charismatic executive will be taking a seat on the company’s advisory board.

With a resumé that includes names like GM, Ford, Chrysler, and BMW, Lutz’s insights on bringing vehicles to market and overall business acumen will be a huge boon for this relatively unknown startup, and could easily galvanize other investors into investing in the company.

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News

America Expected to Continue Using Less Gasoline

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Gasoline demand in the United States hit an all-time high in 2006, and ever since then has been on the decline. Aided by rising prices, more efficient vehicles, and a slowing population growth, the United States as a whole is not only using less gas than before the recession, but we as a country have entered into a continued trend of decreased gasoline demand, which government officials and industry executives believe will be a permanent trend from this point forward. While current usage is about 8% less than the 2006 peak, experts expect to see as much as a 20% reduction in gasoline use by 2030.

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News

Save the ‘Ring

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No, we’re not encouraging you to step away from any planned New Years Eve wedding proposals, but the Nürburgring Nordschleife does apparently need your help. Known throughout the motorsports community simply as the ‘Ring, the Nürburgring Nordschleife track plays host not only to car and motorcycle enthusiasts, but also serves as a formidable test track used by many OEMs when developing new vehicles (recently the track has also been a place for manufacturers to lay bragging rights for quickest lap times in sports cars).

It seems however that the ‘Ring, despite its popularity with track enthusiasts, is not the profitable endeavour that the German government thought it would be. Four years ago plans began to be implemented that would see other attractions added to the Nürburgring venue, which have reportedly done nothing to help boost the profitability of the track, and now in May of this year the ‘Ring was turned over to the same pair of businessmen responsible for that transformation, with the goal of boosting the track’s revenue, and that’s where the controversy starts.

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News

Harley-Davidson Pays Back $297 Million in Loans

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Harley-Davidson filed papers today with the SEC disclosing that the company has bought back $297 million in papers (essentially paying off a loan) from Davis Selected Advisers, L.P to the tune of $380.8 million. Taking the loan amount at 15% interest, Harley-Davidson borrowed roughly $600 million from Davis Select and Warren Buffett ($300 million each, despite what other blogs seem to think) back in February of 2009. This announcement marks the first step Harley-Davidson has taken in repaying that debt, and with the added $100 million in interest payments, it’s easy to understand why.

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Federal Reserve Discloses $2.3 Billion Short-Term Loan to Harley-Davidson – $3.3 Trillion in Total to Others

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The Federal Reserve made disclosures today that it quietly made short-term loans to major institutions and Fortune 500 companies during the 2008-2009 economic meltdown. Among one of the companies listed as receiving a 3-month Commercial Paper Funding Facility (CPFF) promissory note from the Fed is Harley-Davidson, which received 33 loans totaling $2.3 billion in aid to meet operational needs. Other companies who received economic help include GE (12 loans totaling $16 billion), Verizon (two loans totaling $1.5 billion). Commercial paper was also purchased from McDonalds, UBS ($74.5 billion), AIG ($60.2 billion) and Dexia ($53.5 billion).

The concept of “buying paper” has been mislabeled by other sources as a bailout from the Fed, despite the fact that loans made by the Federal Reserve differ from the bailouts we saw for the auto and banking industries both by being for a short-term duration, and because they only replaced other short-term cash flow loans that disappeared during the financial crisis (that’s what you get for getting financial news from a motorcycle site that spells Warren Buffett’s name like a meal from which guests server their own food, and then over reports his lending amount to Harley-Davidson by over three-fold).

If anything this news shows the great lengths the Federal Reserve had to take in order to keep the credit market open for major American businesses and institutions. It should be noted that because of the Fed’s efforts these companies were able to receive the cash flow and short-term loans to stay afloat during the crisis, and now that the CPFF program is over, the Federal Reserve reports that it not only was paid back in-full by every borrower, but also made money on the interest of all the loans ($849 million in total).

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