Grand Depart 2016 Costs and Benefits

Want to host the Tour de France? If so then France’s state auditor the Cour des Comptes, “the court of accounts”, has issued a report into le grand départ from 2016 that gives us acloser look at the finances, business and practicalities of hosting the Tour de France.

Intro facts: The start of the 2016 Tour de France was held in the Manche départment in northern France in the Normandy region. It was this department that was the host of the event and it created an organising body called “La Manche – Ouest Normandie – Grand Départ Tour de France 2016” (LM-ON-TdF) to run the grand départ. The opening stage at Utah Beach was won by Mark Cavendish with Peter Sagan winning the uphill finish on the edge of Cherbourg the next day. The Tour is run by Amaury Sport Organisation (ASO), a French business owned by the Amaury family.

Bid timing: the Manche first submitted its bid to host the Tour de France in 2012 and this was accepted in 2014 for the 2016 edition. This shows a relatively brief calendar with four years from bidding to hosting, a shorter cycle than other big sporting events but reasonable given the race is only visiting for a weekend.

Goal: the bid and the work of LM-ON-TdF was (translated):

“to suggest a range of measures… …to engage residents, attract tourists, bring in traders, entrepreneurs, local bodies, charities, federations and local sports bodies as well as the wider public”

Note the verbs rather than measurable targets and it’s here we see the first criticism from the Cour des Comptes as it states these aims are vague and undefined.

Hosting fee: LM-ON-TdF had to pay ASO’s fee of €2.4 million and on top of this arrange various installations like the press room, toilet facilities for spectators and provide a ready area for the finish line and podium facilities.

The Cour des Comptes says the hosting fee is hard to evaluate because it is not public but cites other starts: €10 million for London 2007; Corsica in 2013 paid €2 million; Utrecht 2015 was €4 million; Düsseldorf paid €6 million last year.

Staff: at its height in June 2016 15 staff were working for LM-ON-TdF, including 5 stagiaires (interns) and they worked on logistics, communication, promotion and another 700 volunteers on top, including 250 for the opening ceremony.

Opening ceremony: LM-ON-TdF outsourced the opening ceremony where the teams are paraded on stage to a third party and paid €206,000.

Budget breakdown: ASO’s €2.4 million fee was the largest item followed by €1.6 million on public relations and communication, €0.5 million on staff costs, then other incidental costs for a total cost of €5.3 million. This was funded by France’s layercake of local government with the Normandy region (€1.3m), Manche department (€2.9m) and local communes (€0.8m) paying in too as well as some small additional income from local sponsors and hospitality sales.

Local sponsors: ASO has a clause that the grand départ can have additional sponsors to those brought by ASO itself (LCL, Skoda, Vittel etc) but they must not be competitors of race’s existing sponsors and LM-ON-TdF has to pay an additional fee of €100,000 to ASO if outside sponsorship happens (a one-off flat fee, not per sponsor). The Cour des Comptes says this six figure hurdle put a brake on finding local sponsors, by extension the income generated had to be substantial to make it worthwhile for LM-ON-TdF beyond the fee. Brittany Ferries and a local dairy producer became sponsors.

Extra costs: the €5.4 million figure is only for the direct hosting, there are other costs involved such as resurfacing the roads and sprucing up villages and other spots along the road. Cherbourg spent €340,000 on roadworks for the stage finish where Ritchie Porte punctured and struggled for team mates before Peter Sagan beat Julian Alaphilippe and Alejandro Valverde. Like counting the spectators what portion of roads resurfaced would be redone without the race’s visit isn’t clear.

Spectators: there were 878 444 spectators according to a study by Orange, France’s telecoms operator which measured the flow of people via the mobile phone network and then made some assumptions and extrapolations so don’t count to the nearest person. Here’s the breakdown anyway:

Of the foreign visitors, 29% came from the UK, 19% from Germany and 11% from Belgium. But how many of these were drawn by the Tour and how many were simply in the area and happened across the race? The auditor says this is not clear and a comparison between the same zone and the previous year would be useful.

Spectator spending: LM-ON-TdF estimates the spectators spent €22.6 million based on the assumption of an average spend of €32 for a day tripper, €74 for others based on a marketing study by TNS-Sofres, an agency, on tourism in France from 2013. This income to expenditure ratio of 4:1 is in line with previous Tour de France starts like Corsica and doesn’t include spending from the 4,500 people following the Tour de France (team staff, media, workers etc).

Media coverage: the race gets big coverage with claims of 190 countries showing it but how much of this is actual live coverage versus a 20 second “the Tour de France started today” package in a news bulletin is anyone’s guess. The Cour des Comptes notes that some of the coverage in the regional press was bought and paid for by the local department.

Conclusion: want to host the start of the Tour de France? You’ll need a few million Euros to spare but get your bid together and it could happen within four to five years. Be prepared to accept ASO’s terms and conditions and then set aside money for local events and road repairs on top too. It’s costly but seems positively Keynesian bringing in an estimated four to five times the spend and ensures beaucoup media coverage. Plus if you’re the mayor or regional patron you’ll be on the podium to meet and greet the stage winner and yellow jersey.

A parting thought: you need something to flaunt and the right weather. Many will have wowed at the scenery and sunshine in Corsica and thought of visiting but last July’s Düsseldorf start was a damp squib.

Source: https://www.ccomptes.fr/fr/documents/41284