History Deep Dive: Why Suzuki's Withdrawal From MotoGP Won't Be Like Kawasaki In 2009

Two years after starting the blog which would eventual morph into MotoMatters.com, I felt it was time to quit my job and do this full time. It seemed like the perfect moment to pursue my dream of writing about MotoGP for a living, so I handed in my notice to my erstwhile employer and prepared to strike out on my own. That was late August, 2008.

Two weeks later, on September 15th, Lehman Brothers collapsed, kicking off the Global Financial Crisis which would plunge the world into recession. My timing turned out to be absolutely terrible.

Why am I looking back to 2008? Because the financial crisis sparked by the collapse of the US housing market and the worldwide banking system would have a profound effect on motorcycle racing, and would go on to shape MotoGP as it is today. It would create the conditions where there were six manufacturers racing in MotoGP. It would also reshape the politics of MotoGP to put Dorna in a much stronger position to cope with Suzuki's decision to withdraw from the series.

What will Dorna do and how will they handle Suzuki's withdrawal? To understand their current position, you need to go back to 2008, and the aftermath of that terrible September.

Lessons from history

MotoGP had already been struggling. After the triumph of the fire-breathing 990cc four strokes, culminating in perhaps the most memorable season in the history of grand prix racing when Nicky Hayden pipped Valentino Rossi to the 2006 championship against seemingly impossible odds, the switch to 800cc MotoGP machines had been a disaster.

Ducati had realized that speed would be at a premium, and the factories were engaged in a war of electronics to manage the incredibly peaky engines being built in pursuit of rapidly increasing levels of horsepower. The simultaneous change to tire regulations – tires to be selected before the weekend, playing into Bridgestone's hands by removing Michelin's ability to produce tires tailor-made for the conditions based on Friday practice – had made the racing processional. Costs were spiraling out of control, and interest in the series was waning.

In the immediate aftermath of the financial crisis, MotoGP manufacturers examined their priorities. At the end of 2008, Kawasaki announced they would be pulling out of MotoGP. With the global economy in the state it was at the end of 2008, that was not a surprise. The Japanese factory was spending over €60 million a year for extremely modest results, John Hopkins finishing the year in 16th overall, his teammate Ant West two places behind him.

The Kawasaki withdrawal was a bombshell. But MotoGP came very close to sustaining what would have been a fatal blow at the time. Honda Motor Co held board meetings at the very highest level to discuss its future in motor sports. At that meeting, they decided to pull out of F1. It is said there was a strong push to pull out of MotoGP as well, but, according to rumor at the time, they felt that they needed to be racing motorcycles, as that was in line with the company founder Soichiro Honda's legacy.

Turning point

That winter proved to be a defining moment in the history of motorcycle racing. MotoGP continued, though in severely diminished form, the field down to 17 bikes in 2011, Suzuki cutting back to a single bike that year, before withdrawing completely the following season. But it also sparked a series of changes which would revolutionize grand prix motorcycling, and create the incredibly healthy grid we have in 2022. It would see the return of 1000cc bikes in the premier class, and the replacing of the 125 and 250cc classes by Moto3 and Moto2.

In many ways, the timing of my decision to quit my safe job was risky. But the advantage was that I got to be in the paddock in one of the most interesting periods of its history, and talk to a lot of the people involved in the changes to the series, to understand their motivations and how and why certain decisions were made. That gives me some perspective on the current state of the series, and how the shock news that Suzuki will be withdrawing from MotoGP at the end of the year.

(As an aside, it is curious that there has still been no official announcement from Suzuki corporate headquarters, neither to confirm nor to deny they are pulling out. Golden Week, the week of holidays in Japan, ended on Wednesday, but Suzuki are yet to issue any kind of official statement at all.)

The withdrawal of Kawasaki and the talks held with the Japanese manufacturers accelerated a series of processes inside Dorna and within MotoGP. Carmelo Ezpeleta had flown to Japan with senior Dorna staff to meet with Kawasaki, and found themselves to be relatively powerless to change the Japanese factory's mind. Threatening them with breach of contract, Dorna extracted a promise by Kawasaki to support a one-rider team for the 2009 season.

That resulted in the birth of the Hayate team, as the remnants of the Kawasaki program put together a one-rider campaign with Marco Melandri, with Andrea Dosoli and Ichiro Yoda leading the team. It proved to be successful, Melandri outperforming the results of the factory Kawasaki team from 2008, but the Hayate team came to an end at Valencia in 2009.

Why had Dorna been unable to prevent Kawasaki from leaving? Since 2002, Dorna had signed five-year contracts with the manufacturers racing in MotoGP, but it was the manufacturers who held the upper hand in negotiations. The contracts were signed with the MSMA as a body, rather than with individual factories. That meant that Dorna could put pressure on the MSMA, but could not deal with factories directly.

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Comments

Regardless of the commercial contracts and revenue splitting, the problem is fundamentally unchanged. A factory organization is no longer interested in funding a MotoGP racing team. The incidence of the problem is also unchanged. Suzuki believe they will benefit from withdrawal, while Dorna is badly injured by Suzuki's withdrawal. Even if the contract between Dorna and Suzuki stipulates that Suzuki must pay $1,000,000,000 to breach, it doesn't fix Dorna's problem. Suzuki will merely collect their checks from Dorna, and run a two bike team on a shoestring, doing just enough to avoid making a mockery of themselves. Dorna will suffer substantial opportunity cost as they are contractually obliged to pay a team that doesn't care, rather than finding a new organization.

Dorna's only real option is to give Suzuki a financial incentive to leave the racing team behind. There are a dozen different ways to make it happen. All of them are complicated and fraught with problems, but it's the only way Dorna can avoid losing a sophisticated team that contributes to the entertainment value of MotoGP. 

... that the entire team should defect to MZ.  That was gold.

From a sporting perspective it's going to be extremely interesting to see how this all shakes out with teams, riders, bikes.  From the teams perspective it's extremely sad that they have all been thrown in the deep end in spite of doing everything absolutely right.  From my own perspective, I'm going to be really sad to see those bikes go, they are probably the only bikes in MotoGP that remain 'beautiful' while still being so effective.

A fabulous piece of journalism and analysis. It will certainly elevate commentary in the mutterership.

Whilst you are likely to get short odds on the replacement team being an Aprilia satellite squad, I am wondering whether another manufacturer that has the capital, racing pedigree and infrastructure (eg BMW) hasn’t pondered buying the Suzuki IP. You wouldn’t be buying a dud, that’s for sure. 

Honda sold their F1 IP to Ross Brawn, and more recently sold their entire F1 engine project to Red Bull. If Suzuki are willing and able to sell, it may not need to be a motorcycle manufacturer that makes the purchase.

Agreed that it needn’t be another motorcycle manufacturer, but it likely makes it easier and possibly easier to sell to DORNA. 
 

Suzuki are (most probably) facing stiff financial penalties and a backlash from we the viewers. You would have to believe they are unlikely to return to the paddock (certainly in the foreseeable future). They may save face and minimise those financial penalties IF they could offload the IP/team etc to another manufacturer. I wouldn’t care if the sixth team was say BMW, with those bikes in 2023 and beyond. BMW have been playing in WSBK for a long time without success. They are committed to racing, so why not jump in to the big league with a proven bike and team. Deals can be done.

Dorna definitely benefit if they can get Suzuki to offload the IP to another manufacturer, but I’m not sure another manufacturer will be forthcoming. SBK and GP have different business models. In theory, though it’s not working very well, SBK is about direct sales. With the new homologation specials, the factories are trying to notch a thousand bike sales to race teams and club amateurs over the product life cycle. Then they try to sell another few thousand more to enthusiasts and collectors. If you can sell 5,000 bikes at  $30,000 per that’s $150M. You can fund a boutique series production operation with that sort of cash and then use SBK to market your brand.

GP doesn’t work that way. Manufacturers pour tens of millions into a program. If the team is successful, a sponsor might offset 25% of the budget, but ultimately bike sales must carry a GP project. Not sure who’s willing to make this investment. I doubt BMW would convert touring bike profits into MotoGP losses, but you never know.

Best case for Dorna is that someone like Kenny Roberts shows up with Monster Energy. Suzuki sells all IP and perhaps some facilities in Europe, then they lease engines to the new team as part of a long term contract. Dorna gets a beachhead into the US market. Suzuki gets to cash out, and maintain some marketing link to GP at a tiny fraction of the cost. It may not be possible. For all we know, Suzuki might be licensing some of their IP.

Which he then off loaded after one season because it was unsustainable. He loopholed the rules which gave them an advantage for the first part of the season, then hung on until the end despite little or no development, just. F1 is a huge bag of brown stuff. The whole system was and still is to a degree arranged around maintaining the position and power of the leading teams. MotoGP on the other hand has tried, with a great deal of success, to produce a system where every manufacturer can succeed. This has produced a very competitive field which means that although everybody can succeed, they must try very very hard and do a very very good job. The idea that Suzuki can sell their team and if you feed it money it will succeed is true, it's a good team, but you would have to feed it the bike too. That's what Suzuki do and if you were running the team why would you choose Suzuki ? Why would you want a team where you are restricted to which bike you can use ? What if Aprilia offered preferential terms ?

To Suzuki or not to Suzuki would depend on an organizations ambitions. If you run satellite Aprilias, you’re just a vassal state of the Aprilia organization. The IRTA money goes to the factory to lease the bikes and then you scramble to find sponsorship to pay everyone’s salaries. If you buy the Suzuki IP, you are running your own team. Obviously, running your own team has a steep price tag, one that Dorna cannot cover so it needs to be a manufacturer or major business concern who see GP as having indirect business benefits. Suzuki no longer see GP that way.

They would be back of the grid, if making the grid at all, for every race. Unless, as we are speaking of Suzuki, they cover the cost of Suzuki continuing in all but name. The majority of which would not be the race team.

Takeover is what we are discussing. Another manufacturer buying the Suzuki IP and facilities in totality or a well-funded sponsor like Red Bull turning Suzuki into a rolling billboard and B2B plaything or some race nuts buy the chassis IP and sign a long term engine supply deal with Suzuki. Dozens of ways it could happen, but no guarantees any of them will work or that Suzuki are even willing.

Who’s doing the development in this scenario? Where is the next ride height device coming from? They’d be absolutely left behind. 

I'm busy this morning but couldn't resist reading it!

Regarding Suzuki's commitment to racing:

I seem to remember maybe 10 or more years ago, Leon Haslam on a Suzuki was making a serious fist of winning the WSBK WC, Max Biaggi was a close rival. Then about halfway through the season Suzuki withdrew factory support without warning - it was an incredible decision, left Haslam totally in the lurch, and results duly suffered.

This would support you view that at the top racing's never been very important.

Another question, it is known that large Japanese manufacturers can be very parochial organisations, with families dominating boards and management (Toyota’s woes a few years ago largely emanated for the lack of skilled decision making and peer review, where senior jobs went to family members and not the best candidates). Is that the case with Suzuki? Perhaps if there was a racing keen family this wouldn’t have happened!

Suzuki’s MotoGP team are obviously first rate – I hope they find great jobs elsewhere in the paddock.

All this hand wringing, teeth gnashing. One shoe has dropped, lets wait until at least tuesday before we let the speculation engines rev to the limiter.

While it’s a shame if Suzuki leave, I don’t think it’s really such a big deal other than for those immediately affected. Look at it this way - if someone gets switched on to MotoGP next year, are they likely to watch the races and think “hmmm, it feels like something is missing”. I doubt it. There will still be 5 brands slugging it out, along with satellites, and Mir & Rins will almost certainly still be in there somewhere.

I think the bigger picture is more worrying. That same person is quite likely to see the demise of ICE racing in their lifetime. How many of us follow MotoE? Not me. And if it doesn’t captivate the mutterers, who would drool over an Honda Mini Melody if it was well preserved just because it has a petrol engine, how will Dorna sell that to the TV channels?

We are extraordinarily lucky, to be seeing motorcycle racing at its absolute zenith. I doubt it has ever been so close, the machinery so equal, so about the talent of the rider.

"We are extraordinarily lucky, to be seeing motorcycle racing at its absolute zenith. I doubt it has ever been so close, the machinery so equal, so about the talent of the rider."

Copied from DORNA's PR page? 

If American Racing step up from Moto2, maybe Joe Roberts could get his Aprilia seat after all and team with Cameron Beaubier. 

Another Moto2 team that could step up is Honda Team Asia, and LCR could run the Aprilia satellite team. 

Who knows what's happening with RNF Yamaha or if they will exist next year? Who will run satellite Yamahas?

Thank you David, as we motomutterers almost always seem to say, for another well written article. While you say your timing in 2008 might have been awful, from my standpoint it was a brilliant dunking into the pool from which you now pull so many delicious fish.

Right? The timing brought opportunity, print media and "the old ways" were falling away. 

Entropy and things coming apart is scary and upsetting, confusing. It also offers a lot of possibility.

Suzuki had a REALLY good go here this time around. Hope they come back when the cotton is high again. 

Excellent analysis as usual David.

Without MM us fans would be left with much less credible information

I was reading this piece as a non subscriber and found it so enthralling that I gladly paid up to complete the story. Insight into the workings of factories was particularly interesting given the recent rumours of a potential Suzuki "diesel-gate".

As the underdog from Hokkaido I really want Suzuki to do well in the global motorcycle racing scene. Their MotoGP departure saddens me so hopefully the logic behind their decision will soon become apparent.

In the meantime I eagerly await further musings on my favourite sport!

Unquestionably you will get musings on your favourite sport - and much more besides - from the amazing depth of erudition displayed by all contributors on this site. Even if, as a non-racing motorcyclist, but having fallen off enough to wince every time I see a highside), much of it goes over my head. :-)

 

I just do bonehead comments, none of that fancy erudite for me!  :-)

This is the best place to read about MotoGP there is. A little bit on WSBK too.

Got an email just now from the (U.S.) IMS Motorcycle Shows saying that they have cancelled all their events for 2022. The message mentions supply chain issues for manufacturers and vendors.

Maybe supply cannot keep up with demand, so why spend marketing dollars? Perhaps related to Suzuki and motogp.

Incredible that the lesson wasn’t learned from VW, albeit this is just an investigation. I note with interest too that Marelli are involved aren’t they MotoGP’s ECU supplier?

if this investigation leads to prosecution then yes, could be a big hit to Suzuki. Well spotted and thanks for posting.

There were only 22,000 of their cars involved. The problem came from Marelli and Stelantis, whatever the hell it was called back then. FCA? Suzuki can (more or less) legitimately claim they are innocent victims, I suppose. And honestly, I must confess I have a sneaking admiration for the VW and Fiat engineers who developed the cheater systems. They should be in racing somewhere, lol.

Yes, I bet the company did big lolz at the 590M euro fine in the EU and its $2.8B of fines in the US, let alone the money they had to give to lawyers trying to defend themselves to no avail ;-)

On one hand, it was fairly clever to figure out a way to cheat the ECU when the cars were on the smog check machines and have those engines "pass". On the other hand, I'd rather they had put that effort into getting the cars to legitimately pass the tests. I think it was done like that because they had realized they'd missed the boat on getting started down the electric path, and had too much invested in diesel tech.

Here is a new story of perseverance and adaptation in the face of adversity. Maybe you find it encouraging?

Peter Hickman (schmaltz warning, a rider I love) in preparation for the 2022 TT etc campaign --

Plans were long in the making, first Isle of Mann to be held since 2019 due to COVID - Hickman had planned to enter six races running the FHO Racing BMW M 1000 RR in the two Superbike races and in Superstock configuration, the faired Triumph Street Triple 765 RS in Supersport he bought from a BSB outfit, and the Norton Superlight he spent a ton of effort and money developing in the Supertwins class (Norton quit after they put the bike out, he nearly built 30 just to have it allowed!).

Last minute, he gets told he can't run the Triumph nor Norton at various events. So despite it all he quickly swaps to an Aprilia RS660 for Twins -- EXCELLENT UPGRADE. And he just sits out the first Supersport race at the NW200 that isn't accepting his new Triumph. 

Hickman is an established figure at the road circuits on these bikes. Eagerly followed his Iron Maiden Beer Triumph 675R campaign. Watching his record breaking Isle Of Mann Senior Superbike run aboard the BMW? Oh deary, it feels amazing. If you haven't in a while, have a sit.

Best of luck to Hickman. Fantastic flexible adaptation and perseverance. May everyone in a Suzuki GP shirt find the same. 

18 mins video, 2018 record holding run at IOM TT

https://m.youtube.com/watch?v=ju_hxwAanX0

David, I never comment - serial lurker. I’ve been following you since the days you posted on ADVRider and you started this site. And had to change the title because of legal shenanigans. 

Just wanted to say that I have no problem paying for a subscription to the site. You do an amazing job and you should be paid for your work. Keep it up - one of my favorite sites.