Kyalami's upgrade to F1 status, now approved, could cost up to R200m - sports business specialist

The Money Show's Stephen Grootes discusses the development with sports business specialist Nqobile Ndlovu/

International governing body the FIA (Federation International de l'Automobile) has approved the upgrading of the Kyalami Grand Prix Circuit to Formula 1 status.

This has got motorsport fans' hopes up that Formula One will finally return to South Africa.

RELATED: Chance for F1 to return to SA as Kyalami gets approval to upgrade circuit

The current 4.522km layout of the Midrand track already holds FIA Grade 2 certification.

Stephen Grootes chats to sports business specialist Nqobile Ndlovu about what it'll take to get to the point of hosting a Grand Prix.

Firstly of course, a substantial financial investment will be required from the owners.

The circuit upgrade could cost anything up to R200 million, says Ndlovu.

"To get it to Grade 1 status, the estimate is somewhere between $7 million and $10 million - so upwards of R100 million or around R170 million, and up to R200 million if there's an overrun in costs."

Nqobile Ndlovu, Sports Business Specialist

"That's because the vehicle that currently drives in events like the Nine Hours of Kyalami  are not as fast as F1 cars, so you need runway long enough for the vehicles if they run off and hit a barrier that there's enough distance from the track."

Nqobile Ndlovu, Sports Business Specialist

Other facilities might also needed to be upgraded or added, he says.

Then there are the hosting fees to be considered, once Kyalami does indeed get to hold a Grand Prix.

"You also need to take into account that your calendar is usually decided a year in advance, and most circuits have a cycle of 4-5 years during which they're in the F1 calendar."

Nqobile Ndlovu, Sports Business Specialist

He does also highlight a number of factors that would count in South Africa's favour, including the lure of its attractions for visitors, favourable time zones, and the nostalgia factor.

"The design of the track is fantastic, not boring like some others... F1 at Kyalami was one of the best Grand Prixs until the 90s when the costs of running it were just unsustainable, and also more upgrades became a requirement."

Nqobile Ndlovu, Sports Business Specialist

For more detail, listen to the interview audio at the top of the article