Alvaro Bautista: The (Excessive) Cost Of Success

By Steve English | Tue, 16/04/2019 - 19:22

Alvaro Bautista continued his unbeaten run of success at Assen. The time might be nearing for Ducati to evaluate the costs of such success

On Sunday Alvaro Bautista won his 11th straight race in WorldSBK. He’s unbeaten in 2019 and he’s well on his way to adding a Superbike title to his 125GP crown. The Spaniard is riding with incredible confidence and consistency and he’s a joy to watch. That is unless you’re the financial directors of Ducati. The costs of his success are racking up and he’s put himself into a very rare position - he’s potentially winning too much!

In racing all success is measured in numbers. Number of wins, number of podiums and number of pole positions. The contracts for riders reflect this. The more you win the more you make. Incentives have always been heavily rewarded and no doubt Alvaro Bautista’s contract is structured in a similar way.

In conversation with riders and team representatives in Assen the general figure bandied about for race wins was €25,000. Of course with the Superpole race having been introduced for this season it’s possible that the ten lap shootout has a different value attached to it. Some riders said they aren’t paid bonus money for the Superpole races and others are on the same as any other race.

As a guideline we’ll use Bautista’s figures to be what seemed the normal going rate of €25,000 for a race victory and we’ll assess that Ducati are offering him a lower figure for the Superpole race victory.

In 2003 Neil Hodgson started the season in a similar vein. He was unbeaten through four rounds, won nine races in a row and over the course of the season won 13 times. His contract was such that his win bonuses, and championship bonus, left Ducati with little option but to find another home for the Englishman. The 2003 WorldSBK champion moved to MotoGP with the D’Antin squad and saved Ducati a fortune in bonus money for 2004.

As it stands you’d imagine that Bautista, managed by Simone Battistella, has put himself in a very strong position to negotiate an immediate return to the MotoGP. If we assess Bautista’s success thus far he’s earned at least €200,000 in bonus money from feature race victories and you’d imagine that three pole positions and four Superpole race victories have earned him some extra notes on top of that.

With championship bonuses and another 27 races in 2019 his earnings could be sky high for this season. His unprecedented success has been such that it must have started to set a Ducati accountant into a cold sweat. It’s a nice problem to have for the Italian manufacturer but with Danilo Petrucci and Jack Miller out of contract at the end of this season there would be potential to move the runaway WorldSBK series leader back to the Grand Prix paddock.

Would Bautista leave? That’s harder to know but if he did go he’d certainly leave with a much improved base salary compared to this year. Battistella is generally regarded as one of the coolest operators in the MotoGP paddock. He’s a manager that is noted for his ability to always look out for the best interests of his clients but also who can leave something at the table so that teams and manufacturers are happy with the negotiations. It would be a surprise if such a clever operator hasn’t negotiated some clauses to give Bautista a potential avenue back to MotoGP and with the Spaniard’s earnings raising considerably with each passing weekend there will come a time when the motivation to make a change starts to be felt in Bologna.

Sometimes winning isn’t enough in racing. Sometimes it’s actually too much. It happened to Ducati in 2003 with Hodgson, could history repeat itself in 2019?

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World Superbikes
Ducati
Alvaro Bautista

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Comments

Difficult to imagine at 34 years of age currently that Bautista would get a MotoGp ride but, who knows. Ducati have hired a lot of older riders in the past. I've always said bauutsita could do well on a competitive bike, He did well in Phillip Island last year and had he not crashed so many times during the Free practices then he might not have been as tentative suring the race & might have done better than 4th. 

Jack and Bagnia are young enough to hopeflly mould into winners for Ducati but lets face it, every single rider Ducati have are not good enough to beat marquez for the title. If Dovi gets a title it'll be becasue Marc missed a lot of races.  No one has a rider to beat Marc for the title anymore since Stoner left and it's kind of pointless for them to even try anymore.

I'd like to see Remy Gardner on a fatory bike some day soon. Maybe he can bring it to Marc.

Have to agree with you here. Age is really an issue, combined with a long history in MotoGP.

It is tough to disagree with Steve, who likely knows more about motorbike racing than I'll ever imagine, but Bautista spent 8 years in MotoGP with a total of 3 podium, and zero wins. He had an assortment of bikes over the years. none of them top tier.

Seems that the guy who ends a 7 year drought of WSBK championships is likely to stay right where he is, and if that means that Ducati pays for it- so be it. Thats my guess, anyhow.

The comparison to Hodgson is illustrative. He was 31 when he went back to GP, and did exactly nothing. 6 DNF's and 3 top tens, with the rest at the back of the field. The guy was a massive talent, but his return to GP did not go well by any measure. IIRC, after that he was shuffled off to AMA to partner with EBoz on the Parts Unlimited 999. On a full works 999F05, he was outclassed by Mladin, Spies, DuHamel, etc, etc.

I hope that Ducati keeps him in WSBK. It will raise the level of the grid, forcing people to step up. If he goes back to GP he likely takes a seat from a young guy on his way up, or a paying customer of Ducati Corse in the 2nd satellite team. Its a lose-lose for Ducati at that point.

EU200k is a lot of money, I'd be pretty happy to recieve it, but you have to put it into perspective.  If Bautista wins 20 races this year and collects EU500k in bonuses, that's fantastic for him, and it's possibly more than his base salary at the factory at WSBK, but, how much does a motogp rider collect in salary?  Sources I can find suggested that Alvaro was earning EU450k riding for Aspar (not sure if that was salary or salary+sponsorship).  Dovi was rumoured to be getting $2M a few years ago, and the rumour was that this more than doubled after Lorenzo's dismal first year on the Ducati.  They could afford to pay Rossi in excess of EU10M (reportedly), and Lorenzo EU12M.

So, if they put Bautista back into motogp, how much more money would they have to pay him as a reigning and dominant WSBK champion?  Conversely, how much would they have to pay Miller, or Bagnaia in the factory team?  I'm guessing not much in their first year.

And at the end of the day, if they pay $500k to Bautista in bonuses then it's still a good deal because, so far this season, if they didn't have Bautista on the bike then they would have wasted untold millions of dollars developing a new motorcycle, running a team, paying the riders, and they'd still have no wins - and barely a podium for their efforts.

If racing is a way to sell bikes then Bautista has provided more benefit to the Ducati brand in 3 months than the rest of the Ducati Corse WSBK team have in the last 7 years.

Finally, there's also the passport factor to consider.  The Grand Prix paddock is full of high performing Spaniards, whereas WSBK has been a very British affair of late - with Rea, Davies, and Sykes being the standout riders for the last 5 years.  Surely there must be some benefit for Ducati and the FIM to reignite the interest in WSBK in one of the more bike mad countries in the world.  They haven't had a serious contender to root for since Checa peaked in 2011.

Couldnt be more happy for Bautista to have this success. 
I feel very bad for Sam Lowes who finally got a package to compete with the Kawasakis only to see Ducati leap frog both of them. That kid has shown amazing improvement. 

This reminds me of Lotus Renault and their signing of Kimi Raikkonen in F1. They managed to get him out of retirement for the 2012 season and offered to pay him on a per-points scored basis. It seemed a fairly safe deal for them, they had 2 lucky podiums and scored points about half the time in 2011. So of course in 27 starts Kimi scored 23 points finishes, 2 wins and 13 other podiums, leaving Lotus on the hook for $42million and teetering on bankruptcy.

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I'm sure Ducati have plenty of cash to fall back on should they need it, but it's interesting how unexpected success can be as dangerous as failure sometimes. As for Alvaro and Moto GP, unless Ducati offer him Petrucci's seat (or there's a factory Yamaha, Suzuki, Honda seat available) it's hard to see. Better to rule below than be a servant above, Alvaro's spent enough time risking his life on second tier bikes. But then with a fat paycheque and the SBK title under his belt the siren call of becoming a Moto GP race winner might be too much to resist.

For 13 rounds, 26 race wins potentially, with the figures presented, Bautista's dream season could add up to 650k bonuses for race wins with the presented 25k per race figure, maximum - plus whatever else bonus for poles and sprint races.

Alvaro's base salary, I have no idea, but a racer worthy of a championship contention must have some kind of lifestyle to uphold as well, so ostensibly in the 100-200k euro range, some of which might be in various kind of tax free expense compensation or whatever. I might be overshooting slightly, but the number is now eclipsed by the race win figure anyway. Still, I'd gather 1 million is the maximum amount of salaries paid all in all, and I don't know under which country's pension laws they go under, if additional payments need to be made to cover that, but anyway the ceiling is established.

So a question for team manager: Would you rather have a rider contesting for 2nd or 3rd place while spending 100k euros, or spend ten times that for a clean sweep of all races? Racing isn't for the cheapskates, and the difference of the two from success perspective is absolutely huge. Now, from team management perspective: Alvaro doesn't crash, and racing bikes are not cheap, that's already a factor - as reference a totaled Moto2 bike I heard from Mr. Ajo to be in the region of 80k euros, I'd expect the same from WSBK spec Ducati or more - and the harder parts, with the MotoGP Ducati swingarm case we learned a day at the wind tunnel is 30k euros (not clear if engineers are on top of that).

I digress a little, but professionals in any area are not cheap. A professional engineering consultant who knows what they're doing is easily charging in the ballpark of 200 to 300 euros per hour for works performed at a remote site, on a yearly basis that's half a million cost potentially for just the efforts of one person. A lawyer, you should be so lucky.

Here we have someone who's able to take what the team has and make it into a winner day in and day out, and winning is the objective. I am sure it is a worthwhile investment. Again, racing is not for the penny pinchers. Bautista has earned every cent coming his way, even if the figures might sound like a lot.

How can Ducati have a problem with a A B winning? Aren't they in the business of selling motorcycles? Unless we really know the details of his contract, we should not assume that it is a negative in Ducati's investment return. Why would any manufacturer invest R&D money, tool an entire production line, and then hope for mediocrity on the sales floor or the race track? If he is exceeding the expectations thus earning more money than expected, consider renegotiating his contract when it expires. Assuming he would find that unacceptable, it should be easy to hire another journeyman MotoGp rider that finds themself in a position of no longer being considered for an "A" team ride. Hire that guy and negotiate a contract agreeable to both. The last thing you want is to not be successful at the track.

They probably do not have a problem with him winning, but their bank account might.  When it comes to racing you do not expect to win every race, which is why riders get bonus money for podiums.  This is a rare occasion where the rider and bike are meshing so well that winning become financially a problem.

Even if Alvaro rides to a perfect season and has some deeply buried clause that gives him a $100million bonus for doing it, Ducati would go to their VW Group owners for the bailout. VW Group made $19billion in profit for 2017, however well Alvaro does his pay amounts to little more than a rounding error against that. I suspect VW would gladly poney up the cash for the chance to really stick the boot into the Japanese factories that have so frustrated them in SBK and GP.

I agree with BoZ that with Bautista's age he's unlikely to go back to Moto GP given the incredible crop of youngsters there now and panting in the wings. Having said that, I've always thought him underrated since I saw him at Indianapolis on the Suzuki, where he absolutely staggered me and another ex-racer friend by how hard he was riding. Whatever happens, good luck to him.

Too soon for Pecco, Pramac have one current year factory bike - Miller is on a GP19 like Dovi + Petrucci - and one year old bike for their second rider, Pecco, to learn MotoGP with no pressure. So far Miller is doing what he needs to do, beating Danillo on the same bike every session and race apart from the seat thing at Qatar. If that keeps up the scenrio will as you say Petrucci to WSBK and replaced I thought before this article with Miller but now I see Bautista next to Dovi for one year and Miller on the third factory bike. That will put all the "players" on the same two year contracts. Ducati's BIG problem is how long will Dovi stick around for?

Bautista is doing a magnificent job on his Ducati weapon this year but I just can't see him returning to MotoGP (beyond a Bayliss-style one-off reward ride as CTK mentioned). Miller is at least as quick and is 10 years younger, Bagnaia is surely earmarked for the factory spec Pramac bike next year and without factory machinery, why would Bautista bother? 

Better to earn factory money winning races and titles in WSBK.

If Ducati signed an open-ended contract I would be amazed - especially after the Hodgson experience. Bonuses are both an incentive and a compromise. Bautista may have hopped onto a ‘perfect’ bike, but Davies et al need to be consistently closer to  the front to waft eau de winning over the sales figures. A cap is likely in my view -  but Bautista is raking it in, no doubt.

Thanks for factoring the harsh economic realities into the winning equation. Great analytical insight David. If Bautista continues in this vein of form with the R, it is certainly a chief financial officer's nightmare. The Neil Hodgson case in point is well noted. Another two race weekends with same outcome as in Assen and things will have to be thrashed in terms of the reality of the situation around a simmering boardroom table. Bautista will want to stay and Ducati will want to cut remuneration for results. The name of the game is compromise and I hope that should it come to that, they can work something out. I don't know Alvaro but I would guess guts and glory would sway him in favour of an extra and not budgeted buck for right now. I don't see him returning to GP1 unless as a full factory rider. What would be the point? Dorna may also have a say. I have no stats,yet I'm pretty sure SBK viewership has received a big shot in the arm since the ever escalating war between Rea and Bautista commenced at PI. For Dorna, that is an even bigger bottom line. 3rd party #19 sponsorship is gaining traction and exposure. Merchandise AB3019. In a very short space of timer he, with the V4R have carved out a niche market. Ducati and Bautista are interlocked. A financial mutual agreement between him, his management and Dorna is the smart way to go for all concerned right now. MotoGP1 can draw on a raft of young tallent in the lower ranks with contracts about to expire yet with potential to spare. Jack Miller and earstwhile KTM M3 champion Brad Binder spring to mind. I reckon Ducati could bring the likes of Binder or Jorge Martin into the fold quite easily right now given the miserable M2 KTM factory bike with no end in sight, for miniscule Euro's compared to what it would cost them to take a shot at jettisonning AB out of SBK or roping him onto a factory GP1 horse. Much to ponder. For now Bautista and V4R are tied at the wrists. The one is currently not par for the course without the other. Together, they have been astonishing thus far.

Why is this a story when Baustista is winning race after race, but never came up when Johnny Rea was doing pretty much the same? Heck, a number of times when Rea didn't win it was his teammate Sykes. Wouldn't this same burden have falling on Kawasaki?

And and as a business owner, boy, this is a problem I would like to have.  One of my employees is way more successful at the task I have given him or her than anyone expected.  Alvaro is, at the end of the day, the highest powered salesperson in the Ducati arsenal.  I have a sales team.  One member of it outclasses the others and she receives MASSIVE bonuses.   I'm always happy to write those checks because it means however much she's earning, the company is earning 80% more.   

 

This is an interesting angle, and one I hadn't really figured on before.  But surely that 200k is a very small fraction of what they spend on the racing department?  The cost of running the SBK program would be significant, 5-10million surely?  There must be at least a couple of dozen poeple directly involved at various levels, and many more in lesser capacities.  The objective of racing is surely not the mediocrity we've seen from Ducati SBK in the Panigale V2 era?  So from my perspective, a few hundred k in bonusses to dominate the competition is an absolute bargain?  And with winning ways come sponsors, with the possibility of more than covering the win-bonus conundrum.

I for one hope he stays where he is, and hopefully the rest catch him up a little and we finally get some truly unpredictable outcomes in SBK again.  The scrap for 2nd behind Bautista has usually been quite entertaining, although still with a sense of inevitability about the outcome.

If you were winning a world title and had the opportunity to continue winning world titles as the lead rider in a factory team why would you want to go back to Moto Gp as a second string rider. Surely new sponsors can been be found to cover the bonuses. The exposure would more than warrant the investment.

If the results keep going this way, and its a big if from weekend to weekend, will Barni and GoEleven, Rinaldi and Eugene have cause to protest the rev cuts? Chaz too at Aruba alongside Alvaro? They would have a cause for complaint for sure. Kawasaki are a bit stet with their transverse four. Yamaha are the big winners currently within the ambit of the regulation. The new BMW mill could throw an additional spanner in the works. What then? Sykes takes it to Rea and Bautista with a couple of wins mid season? Rev limit revisited? Nuts! Law of unintended consequences. Adjust,adjust and adjust to create artificial parity. I enjoyed Rea stuffing it to Tom in a class he had made his own on the same bike. Likewise Stoner to Capirex in 2007 GP.  Not because I had a problem with Loris. I have a framed poster of #65 at Catalunya 2003 hanging on the wall, resplendant in Marlboro cigarette livery. first win.. first season in GP. Which brings me to a point. Ducati purposefully design a bike to regain WSBK title after the L-TWIN was hamstrung in the interest of 'SBK political correctness'. One rider out of four adapts to it bloody quick and the brand gets punished by 250rpm. Engineering excellence and foresight punished by political correctness is not the way forward for SBK, especially when 3 are being punished for the grand performance of 1.