Now That's Irony: Spanish Credit Crunch Scuppers Hungarian MotoGP Round

As we reported on Monday, the Hungarian round of MotoGP, due to take place on September 20th, is likely to be axed. The report, which originated with the British publication Motorcycle News, stated that construction of the brand new Balatonring track where the race was to be held was running too far behind schedule, and that as a consequence, the facility would not be ready in time to host the event. Since then, the arguments have started over who is to blame for the situation, with much finger pointing between the partners involved in the project.

The Hungarian Minister for Sport was in no doubt where the blame lay. Speaking to the Hungarian sports daily Nemzeti Sport, Istvan Gyenesei said "Our Spanish partner has not completed all of the steps set out in the agreement we have with them [..] so it looks as if the track will not be ready in time, and we will not be able to organize the Grand Prix there."

But the Spanish company involved were quick to reject any talk of the blame laying with them. Janos Bence Kovacs, president of the Grupo Milton responded to the minister's accusations "I'm surprised what the minister said. We've met all of the deadlines so far. Our tempo is fine, we're even a little bit faster than expected. We will do exactly what we have agreed to do. The project is right on schedule. We will do everything that we are expected to do." He refused to respond to the allegations published in MCN, dismissing them as "purely gossip".

As for the real state of construction, it is difficult to tell just how far along Grupo Milton has proceeded, though the photos published on the website of Sportgeza.hu do not look promising. Obviously, at this stage, construction consists mostly of preparing the site for the track and the foundations to be laid, and so photos can be deceptive.

But Grupo Milton is in a difficult position. Since the outbreak of the current economic crisis, Spanish banks have tightened up their lending considerably. Spanish construction companies have been hit particularly badly, as the banks start to demand repayment of the vast debts the companies have, which they used to finance the building boom which has fueled the Spanish economy for the past 10 years. With the bursing of the housing bubble, property prices have collapsed, leaving large sections of the Spanish construction industry either bankrupt, or teetering on the very brink.

Grupo Milton, which specializes in property in Hungary and Rumania, has been less badly hit by the collapse of Spanish property prices, but could well find itself falling victim to the reluctance of Spanish banks to lend money for construction. Ironically, the could find themselves hoping to be bailed out by the Hungarian government, in a bid to save what would be a big boost for the local economy, rather than the Spanish government.

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Comments

I was surprised to see Balatonring show up on the calendar so quickly assuming it would take at least until 2010 to have it ready for a world level event.

That said, it looks like they are doing just fine.

http://galeria.sportgeza.hu/cikkek/2009/01/20/a_savolyi_moto_gppalya_hel...

Just spraypaint some grid lines and your front straight is complete. Then you just need a couple corners and presto! a new track.

as someone who is very much tied to the former eastern block let me just say there is no way that this circuit will be built in time. likely it'll never get built at all. the amount of red tape, extortion, and lies that are a part of every major construction in eastern europe means that a few people will get their pockets lined and very little will get done on site.

i was amazed when the round was announced. even without the financial crises i would have been surprised to see the dates met.

think about how much work laguna-seca/yamaha put into getting that circuit ready for the 2005 season and how early they started. and that was a refit (granted a major one) but still, the area already has roads, buildings, stands, and the racetrack itself remained gaining a new surface and much more runoff area.

as much as i love the sport i think 18 rounds was too many already and i think a lot of the riders feel that way as well.

not to mention that it's silly to add more european rounds.

i know i'm starting to sound like a broken record but... bring back welkom's phakisa! rio! hell lets add another japanese round (fuji anyone?)

Don't be too quick to put all Eastern Europe countries in one bundle and judge them all the same. While I understand where you are coming from with your statement, Hungary is much less bound to fail with building such a track in time than, say, Bulgaria would be. I can not see the circuit in Bulgaria actually happening at any time in the next few years and even if they get this thing built and the money will not "disappear" in certain pockets, the infrastructure would still not be sufficient to host such a big event as a MotoGP race.
Hungary on the other hand might be an Eastern Europe country, but the potential cancelling of the race there is in my opinion more than anything else due to an overly optimistic schedule which many already suspected wouldn't work out. Hungary is much more Western Europe than Eastern Europe by now and I don't think your assumptions apply there. Especially not since they have a major star in Gabor Talmacsi and the country has a really big number of insane MotoGP fans, therefore they have good reason to build this track and basically secured revenue once it's done.

...and racetracks don't pay for themselves for many years. and the problem isn't the will or excitement, it's the bureaucracy and the corruption among those who would actually be building the thing and who couldn't care less about gabor.

I didn't mean that the fans build the track, I meant that there would be a very good reason for the investors to go ahead with the project - because the amount of money they will almost surely make is a lot more than they could let disappear in their pockets during building the track. Just a simple logic - when they bury this thing now and pocket the money, it's only so much they can get of it (if they do it in the first place). But when they go ahead as planned, there's a much higher and secured revenue to make over the next years, expenses included. And they don't have to care about Gabor or the fans for that, they just have to know about it (and they definitely do) and therefore know what a big market they have on their hands. They just have to milk it.

And I still don't agree with your general corruption assumption, sorry.