The same tax troubles that forced Formula 1 to shut shop in India have proved to be a decisive deterrent for the fast-growing Formula E, says CEO of the electric car championship Alejandro Agag, who doesn’t see the race taking place in the country anytime soon.
Agag said he would love to have a race in a country of more than a billion people but in the prevailing circumstances, it is just not feasible. India, however, has a solid representation on the Formula E grid through Mahindra Racing who has been competing in the series since the inaugural season in 2014-15.
“Our main worry for India is the tax. We have been doing a lot of research on the race in India. We have seen that Formula 1 faced so many tax issues in India. It is very risky to race in India because of the tax authorities,” Agag told PTI .
“They (tax authorities) are very aggressive at the moment. They want to tax everything. So you don’t know where you stand. I think that is the reason Formula 1 did not continue in India. We would like to have complete tax safety and then look at going to India.”
Formula E will be entering its fifth season in December and boasts of presence of auto giants like Audi, Jaguar, Nissan and BMW besides Mahindra. Before the championship began four seasons ago, Agag expressed confidence in staging a race in India and even explored potential venues for the street race.
“We did explore venues. We would really love to race in India and we have three possibilities - Bangalore, Delhi and Mumbai. We have seen areas that will be ideal for the street race. We have a great Indian partner in Mahindra and we have a broadcaster (in Sony Pictures Networks). The only thing we need is an assurance from the tax people,” he said.
The series has managed to attract major manufacturers but the performance of the cars have left a lot to be desired.
“I would say we are still in the early stages in the evolution of technology. The mission of Formula E is to improve on technology but you can’t go faster with each season.
“The performance compared to the conventional cars is not at the same level but it is catching up. In five or 10 years, the performance will be very similar. For the street races, I feel the performance is anyway good,” said Agag.
The CEO also claimed the series is now “cash positive” and it is re-investing the money into brand building.
“It is completely sustainable at the moment. When we started, there were challenges but now I don’t see any sustainability issues in the long-run, at least for the championship.
“The teams keep cards close to their chest. They don’t tell me how they are doing but I see all of them being fully committed to the series.”
The championship has lured in many Formula 1 drivers and this season the new additions are Felipe Massa, Pascal Wehrlein and Stoffel Vandoorne.
“These three drivers were in Formula 1 recently and their presence only makes our championship stronger,” said Agag.
Asked about the often made comparison with Formula 1, Agag added: “I say never compare the two. I don’t know if Formula E cars will be able to match the performance of Formula 1 cars but there will come a time when our championship will be most relevant for the auto industry.”
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