Economic Meltdown Threatens the Very Existence of Professional Sports

PGA Golf at riskAmerican tax payer, and it is going to take some
The organising body of professional golf in thetime for any of these major corporations to
United States may be trying really hard torecover to such an extent that they can afford
convince both professionals and fans alike thatto write off vast chunks of wealth as sport
they will be able to weather the storm, or shouldsponsorship.
we say tornado, because of their close ties toIn a further announcement in Melbourne, AIG said
business, but even they must be aware that it isthey wouldn't be sponsoring Australian Football
business itself that is really feeling the heat, withLeague team, the Tigers, either.
even the traditional giants toppling with ease.Formula 1 under the cosh
Consider the remarkable amount of money up forAnother sport under the cosh is Formula 1 and
grabs in the celebrated FedEx Cup competitionapart from it being a huge financial drain, the FIA
and then ruminate over the recent news thathas also been under enormous pressure to do
FedEx is trimming their full-year earnings outlooksomething relevant about F1's carbon footprint.
by 4% and that was in August, well before theCost-cutting measures are currently under the
collapse of Wall Street. Any astute financial guruscrutiny of the organising body and it has been
will know exactly where to cut costs and believeproposed that standard engines be used from
you me, it will be the sport sponsorship deals that2010 in an effort to survive the worst financial
will be the first victims of a cost purge.global crisis in almost a century.
Tennis is another sport that relies heavily onThe Williams team, for one, made an astounding
sponsorship by both the insurance and financialloss of well over £30 million last season and
sectors, both of which have had to endure somehas been propped up by British bank, RBS and
really hefty body blows in the past couple ofcompanies owned by retailer, Baugur. Both these
weeks.commercial entities have been ravaged by the
AIG pulls out as Davis Cup sponsorcrisis on the world bourses and there is a very
America's insurance giant, AIG, announced onlyreal likelihood they will be withdrawing funding any
last week they will not be renewing their contractday soon.
with the USTA and after almost a decade ofThere is little doubt that the economic disaster
sponsoring the American Davis Cup team, thethreatening the very existence of a free market
loss to the sport will run into millions of dollars.will have a trickle down effect on all sporting
AIG, once the world's largest internationalcodes, even those like the IPL, where the
insurance company, is one of the commercialdeveloping markets are arguably slightly better
giants that were effectively bailed out by theoff than their experienced counterparts.