The 'Rings biggest fight?

Developers trying to turn a profit at the Nürburgring are embroiled in a bitter dispute with local businesses that has cast a shadow over
this great circuit
By Ed Foster

The first glimpses of spring abound in the Eifel mountains. There are bright blue skies overhead, but the atmosphere at the Narburgring — the world’s greatest and most infamous race circuit — is far from cheerful. Why? We need to rewind seven years to get to the beginning of one of the most expensive and controversial revamps of a race venue ever seen.

Like many circuits around the world the Narburgring was losing money. Despite the thousands of tourist laps, the manufacturer interest and a packed racing schedule, the ‘Ring needed to be turned into a profit-making enterprise. In 2004 former Narburgring CEO Walter Kafitz and chairman of the ‘Ring’s supervisory board — and regional finance minister — Ingolf Deubel decided that the best way out was through investment. Investment that would allow the development of hotels, a new village complete with restaurants and nightclub, a new ‘boulevard’ that would act as an events area and shopping mall, and even a casino. The total cost? Over €200 million.

Investors were duly sought, but come 2007 not a single one had been found. Since its inception in 1927 the Narburgring has been publicly owned — 90 per cent by the state of Reinland-Palatinate and 10 per cent by the smaller region Ahrweiler — and so the huge cost of the development looked set to fall on their shoulders. Despite this, project Narburgring 2009′ was given the green light and building work commenced.

“The concept was to use private money for half of it,” says Ron Simons, owner of car rental, driver training and track day company RSR Narburg. “Without the private money it wouldn’t go forward and they kept saying that it was there, but it never appeared.” The obvious anger from the general public — whose tax would now be used to fund the project in its entirety — lead to Deubel resigning immediately once it became clear that the promised private investment had not materialised.

The state, needing someone to take the helm of a new development that was escalating in cost every day, turned to Kai Richter, who had first been approached as a potential investor. Hotel owner Jorg Lindner was also brought in, and the pair have been given a 20-year lease to run Narburgring Automotive GmbH on behalf of the state. By the end of 2010, though, the estimated cost of the development — dubbed `NiiroDisney’ by critics — had reached a staggering €500 million. The roller coaster that ran alongside the Grand Prix circuit and through the boulevard still wasn’t working, and the locals were becoming increasingly concerned that the Niirburgring was about to spiral out of control.

There were problems before the building even started, however, as unbeknown to many people the visitor numbers on which the project was based were inaccurate. “The visitor numbers were hugely exaggerated,” confirms current director of the management team Lindner. “That’s down to my predecessors and it’s been a problem. I think if my partner [general manager Richter] had known about the size of the real figures, the scale of the development would have been different.

“Today, I know they’re not true, but does this help me do my job of making the Niirburgring profitable? No. Do I care? No, because I have other things to think about.”
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News about the money that had been spent on the Niirburgring travelled fast, and rumours that locals were being forced out of business due to Richter and Lindner creating a monopoly travelled even faster. ‘Ring ‘taxi driver’ and well-known circuit specialist Sabine Schmidt’s family runs the Hotel am Tiergarten in Niirburg and she has been very outspoken on the new Lindner hotels and whether or not people are being forced to use them when they visit the track.

“We used to get lots of manufacturers using Tiergarten when they came to test, but since Lindner and Richter have arrived all of them now stay in the Lindner hotels because they said that if they didn’t stay there, they wouldn’t be able to use the track. It seems pretty strange that all of them have left. I’m now about €200,000 down in the last 12 months compared to the previous year.”

I mention this to Lindner, who is clearly angry about the rumours. “That is absolute bullshit. Complete bullshit. I have just come from a meeting with the manager of the hotel you’re staying in — Blau Ecke — and we are actually promoting her hotel and other hotels on our website.” My shock that he knows where I’m staying despite my not having told anyone thankfully doesn’t show, and he continues: “It’s absolutely not true and these rumours are being spread by people in Niirburg who have a special interest in doing that.”

The word monopoly keeps appearing throughout my time at the ‘Ring, though, and it’s not long before the ‘Ring card’ is brought up. Last year a card was introduced to visitors that had to be topped up with money and which could then be used at various restaurants and bars in the area, most of which are owned by Lindner and his team.

“The Ring card is being accepted without problems,” argues Lindner. “It makes things easier for our catering partners as it speeds up service.” However, it doesn’t fit so well with Simons or Schmidt. “A new thing this year is that when you buy a certain amount of tourist laps you get a voucher to use in the Lindner businesses,” says Simons. “For example, if you buy four laps for €89 you also get a €10 food and drinks voucher for the Eifeldorf Griine Holle [the new Green Hell village with restaurants and nightclub run by Lindner and Richter] and also a ring’werk ticket [the new motor sport leisure complex, also run by Lindner and Richter].

“If you get a free ticket for lunch, of course you’re going to use it. But it’s not free — they say it’s free but it’s not. The prices have gone up by five or 10 per cent over the last year, so you definitely pay for it. They will tell you that everyone is free to join — yeah, right. It’s just taking away more customers from local businesses without competing on a fair basis.”

Prices going up is a sore point as there are also claims that the industry pool — a group of car manufacturers and companies that use the Niirburgring for testing — has had its prices bumped up from €1m to €10m. It’s a figure that has made many of them question the power of testing on the Nordschleife. “I would be really happy to confirm that, but it’s bullshit,” says Lindner. “It is absolutely not true. We are talking about companies like Aston Martin and Porsche. Do you really think that a medium-sized company like ours could pull the world’s automobile industry over the table? It’s ridiculous. We can go to our accounting department and I can show you the signed contracts.”

There may well have been signed contracts, even if he didn’t get round to showing me them, as various companies have confirmed that they have signed. However, since visiting the Niirburgring I have spoken to a couple of manufacturers who claimed that yes, prices had been increased, and not just to €10m, but a staggering €25m. They have gone back with a counter offer and say that the negotiations have not yet finished.

The whole reason behind the development was to introduce new visitors to the region — people who would otherwise not come and spend their money in the area. “It’s built for a type of visitor that doesn’t exist,” says Simons. “The only reason people come here is because of the track and nothing else. They wanted to attract people who would otherwise be at Disneyland in Paris, but that’s not going to work. Nowadays you can fly to Brazil in a day and people just don’t want to spend a mainstream holiday in the Eifel region anymore.”

Lindner disagrees, despite having had reservations about the scale of the development. “”If you look at the figures for Formula 1 here over the last few years the numbers are going down. You can’t change motor sport itself, so you have to look elsewhere. Thanks to the new facilities we had 25,000 people here between November 2010 and February this year. None of them used the track, which means that our hotels are working as a complimentary product. We are not competing with the little hotels because they can’t handle those numbers or hold conferences.”
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But none of this helps Ron Simons, whose company — which survives thanks to the Nordschleife — has been banned from using the track by Richter and Lindner.

“We can’t put our cars or our instructors on the track,” explains Simons. “We can usually have customers here all year round — 200 days a year — so if we can’t overturn the ruling soon it doesn’t look good. They accused us of everything, but mostly it was because of breaches in their safety regulations, which is ridiculous. They want to get rid of us because we are a successful company with a large budget and they want our business.”

“We have very strict safety rules,” counters Lindner, “and everybody sticks to those apart from Mr Simons who has been constantly in conflict with them. We have a lot of companies that do what he does which we co-operate with, without any problems.” I ask which safety rules he actually broke? “His cars were not safe for starters,” claims Lindner.

RSR has had 10,000 customers since it opened 10 years ago and Simons argues that he has only ever had three customers — who didn’t have his instructors beside them — who have had to go to hospital because of an accident (two of which were just precautionary checks). When you consider that up to 30 accidents happen on the Nordschleife on busy tourist days, a 0.0003 per cent accident rate isn’t bad at all. Simons took Lindner and Richter to court and lost, which Lindner is keen to point out. “It has been to court and we were proved right and he was proved wrong,” he says. Simons is appealing the decision through the German and European courts.

The numbers may be looking up according to Lindner, but when I had a look around the boulevard and the Griine Holle there was not a soul to be seen. Nor were they busy during the famous 24-hour race in 2010 when I was also there. “Yes, but the 24-hour race is different,” claims Lindner, who points out that the majority of fans camp at the event and don’t stray far from their campsites. Of course, this time I was at the ‘Ring pre-season, so no firm conclusions can be drawn from the photographs, however worrying they may appear.

The fact remains that RSR Niirburg, Scuderia Hanseat (one of the most established driving schools in the world with 52 years experience on the Nordschleife) and the Dorint Hotel have all filed lawsuits against Richter and Lindner through DG Competition at the European Union in Brussels and Bundeskartellamt (the EU counterpart for inter-German affairs). It is a clear indication that all is not well at the Nurburgring.

Sadly Kai Richter couldn’t make our scheduled meeting and when I tried to contact him afterwards I was told that Lindner handles the interviews. Richter was involved in the project planning and its implementation, so any questions about these aspects were rejected by Lindner, who wasn’t involved in the project until May 2010. Still, Lindner and Richter have a rent to pay to the state (reportedly €2m for the first year, €5m the next and €1 5m thereafter) and to do this they must make the Niirburgring a profitable enterprise. Lindner is adamant that much of the media attention is down to the elections that are taking place on March 28 (after Motor Sport closed for press) and the opposition wanting to dirty the current labour leaders, Socialistisch Democratische Partei.

What is certain is that the Niirburgring has lost (hopefully only temporarily) one of its bestknown and respected track day companies in the shape of RSR.

So will the Nurburgring look drastically different when you visit? The development aside, no. Tourist driving will continue throughout the year, as will the regular race meetings. However, under the surface much has changed, the circuit has lost some of its charm and local businesses are struggling to survive. Only time will tell whether the unique atmosphere at one of the world’s most famous circuits has been irrevocably ruined.