Sky surprises industry with sudden cycling withdrawal

12 Dec 2018

By: Sport Industry Group

Secondary sponsors of Team Sky are among those seeking assurances about the future of the British cycling outfit, following Sky’s sudden withdrawal from its partnership with the Tour de France-winning team.

The broadcaster, which this year agreed a £37 billion takeover by Comcast, had been expected to review its investment in cycling in the wake of the deal.

But team owners, athletes and other sponsor brands including Pinarello, Kask and Shimano are understood to have been surprised by the sudden nature of the withdrawal, which will come into effect at the end of 2019.

It gives the team’s owners only a year to find a replacement headline partner – and with rider and partner renewal dates set for the summer, many expect Sir David Brailsford and co to push for a deal that will offer the sector certainty ahead of the Tour de France in July.

Team Sky announced the decision in an open letter to fans, saying: “In terms of the future, we are open minded. If we can find a new long-term partner to take the Team forward into a new era, then we will do so. And we will be doing everything we can to make that happen over the coming weeks and months. Equally, any future partner would have to be the right partner - one who shares our ethos and buys in to our values. 

“This news has only just been announced; we can’t predict what will happen from 2020 and there are no guarantees. Whatever happens, we will make sure there is clarity one way or the other about the future of the Team before the Tour de France next July.”  

The news comes at the end of a season in which Team Sky’s Geraint Thomas secured the outfit’s sixth Tour de France win in the general classification.

The Welshman recently renewed his contract with the team, which has dominated international road racing over recent years, adding to evidence that the timing of Sky’s departure has come as a surprise. Team Sky also took out a five-year lease on new Manchester headquarters in July.

Sky's move coincides with a change of management at the media giant, following the takeover concluded in October, which saw a number of departures from the board including chief Team Sky cheerleader James Murdoch.

Meanwhile, Team Sky management has again faced a series of public questions and allegations this year related to doping and other ethical concerns.

Team Sky’s statement read: “This news will no doubt come a surprise to many people but, as you may know, there has been a lot of change at Sky recently. It is the start of a new chapter for the company and sometimes it is inevitable that change brings further change with it. That is what has happened here. 

“Over the past nine seasons, Sky has backed us all the way, enabling us to achieve some amazing results and inspire millions of people to love our sport. We’d like to thank Sky for all of their support, and in particular the opportunity to help Britain become a cycling nation.”

The commercial health of cycling has been in the spotlight in 2018, with a spate of teams closures including One Pro Cyling, whose owner Matt Prior was among several to question the value of the investment required to compete at the top level.

However, more positive news for the sport has come with the revelation by McLaren that it is to enter into a 50% joint venture partnership with UCI WorldTour outfit Team Bahrain Merida.

Commenting on the agreement, John Allert, Chief Marketing Officer, at McLaren, said: “Racing, technology and human performance are at the heart of everything we do at McLaren. Cycling is something we have been involved with in the past and have been looking at entering for some time.

“It is a completely natural fit for our skills and our ambitions and a perfect partnership with Team Bahrain Merida who have the right vision and approach for the future. We will be working tirelessly in the months ahead as we know the world of professional cycling is home to some of the best athletes and competitive teams in the world of sport.

“What Team Bahrain Merida has achieved in less than two years, off a standing start, is hugely impressive. Working together with a team this driven is a very exciting prospect indeed.”

McLaren says it has a long-term vision to participate “at the top level of the sport,” reflecting the brand’s ambition “innovate at the intersection of technology and human endeavor.”

The partnership will be rooted in the areas of technical collaboration; human high-performance; and marketing and commercial services; delivered through McLaren Applied Technologies and the group’s marketing specialism.

Industry reaction to both developments has reflected a mixed picture for cycling's commercial outlook.

Fraser Houlder, Head of Cycling Sales, The Sports Consultancy, commented: "When looking at sponsorship you see mixed messages – a number of the UK teams have really struggled for sponsors however some of the higher profile events have done well.

“In 2019 we will host the biggest cycling event ever held in the UK, The UCI Road World Championships, Yorkshire. Millions of people will line the road to cheer on the world’s very best riders and as such it provides an ideal platform from which companies can deliver multiple business solutions. In addition to the UCI’s on-going partnerships The Sports Consultancy has already secured and announced a number of partners, including Harrogate Spring Water, Global, VP and Leeds Cares and other big names are set to follow in the New Year.”