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TAG Heuer Powers Red Bull Racing in 2016

TAG Heuer will announce this morning that it has taken over as the engine naming rights sponsor for Red Bull Racing, with the cars to now be known as Red Bull-TAG Heuer.

Thanks to an alert reader at our Forums, we were the first English-language media to report that TAG Heuer’s F1 sponsorship dollars would move from long-time partner McLaren to Red Bull, but today’s announcement shows that the deal goes well beyond being simply a sponsor with a sticker on the car.

Daniil Kvyat's Infiniti RB11If you are not across Formula 1 as a sport, the usual format for a car’s name is to have the name of the chassis constructor (McLaren, Williams, Sauber, etc) followed by name of the engine supplier, giving us McLaren-Honda, Williams-Mercedes and Sauber-Ferrari. But this doesn’t mean that TAG Heuer has designed its own F1 engine- as we’ll explain, the union is the result of a creative marketing tie-up, the likes of which we’ve seen a few times over the years, most notably by, well, TAG.

A Brief History of TAG in Formula 1

ProstTechniques d’Avant Garde (“TAG”) first entered Formula 1 as a sponsor of the Williams F1 team in the late 1970s. Essentially an investment vehicle for the wealthy Ojjeh family, TAG played a key role in financing Ron Dennis’ takeover of the McLaren team in 1982 and as a result took a 50% interest in what was then called McLaren International.

The deal went beyond funding the purchase of the team- Dennis knew that to be successful, McLaren needed a new engine supplier, and while a 1.5 litre Porsche V6 Turbo was available, the project needed money. It was TAG that paid for the engine’s development and as a result, at the start of the 1984 season, McLaren’s cars became known as “McLaren-TAG”.

It was the following year that TAG acquired Heuer, renaming the watch company “TAG Heuer”. And while TAG Heuer was a sponsor of McLaren, the reality is that it was really TAG parent company sponsorship rather than the watch brand. Still, despite TAG selling TAG Heuer in the late 1990s, the McLaren/ TAG Heuer relationship continued through to 2015.

You can read more about the partnership between TAG Heuer and McLaren here.

Red Bull’s Engine Quandary

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As Formula 1 fans know, the story surrounding Red Bull’s engine supply for the 2016 season has been cloaked in drama. Renault has supplied engines to the Red Bull team since 2007, collecting four world championships along the way with its V8 engine. Despite this success, the change in engine formula introduced in 2014 saw a decline in Renault’s competitiveness, causing relations between Renault and Red Bull to quickly deteriorate. What at first was polite displeasure turned into outright hostility after only a few races of the 2015 season.

In the middle of this year Red Bull informed Renault that it would not be continuing with the partnership for 2016 and began negotiations with other potential engine suppliers, including Audi, Mercedes-Benz, Ferrari and Honda. Problem was, none of those manufacturers made an engine available to Red Bull, leaving the future of the team in doubt. At the same time, Renault decided that it would enter 2016 as a full works team, buying the Lotus team (which- if your head isn’t already spinning- was the Renault F1 team until 2011).

So without any alternative engine supply, Red Bull turned back to Renault and proposed a different kind of deal-one that is tied to the man responsible for creating the Mercedes-Benz F1 engine programme.

The 2016 TAG Heuer Engine

Mario_Illien-with-Adrian_Newey-750x400Mario Illien is a brilliant Swiss engineer who founded Ilmor (the name combining Illien’s with his partner, the late Paul Morgan) in the mid-1980s. Ilmor developed engines for Mercedes-Benz in the early 1990s and what we think of today as the Mercedes F1 engine programme is really the continuation of Ilmor, as Mercedes purchased Ilmor in 2005.

Since the start of the year Mario Illien has been working with Red Bull to improve the Renault engine and from 2016 it seems as though Illien will step up his role in developing the Renault powerplant, something that will help both the new Renault F1 team and Red Bull-TAG Heuer.

And so just as TAG funded the Porsche initiative back in 1985, it looks like we’ll be seeing a TAG Heuer-funded engine on the grid in 2016 developed by Swiss (Illien) know-how.

Red Bull-TAG Heuer: The Marketing Opportunity

Daniel Ricciardo Red Bull TAG HeuerAs well as providing TAG Heuer with far greater brand exposure that they could ever have achieved as a mere sponsor, the other benefit of the deal will be access to perhaps Formula 1’s brightest personality- Daniel Ricciardo. Ricciardo is a perfect fit for TAG Heuer as a brand- he’s friendly, down-to-earth, smiles all the time and is blindingly fast.

TAG_Heuer_RED_BULL_RACING_Announcement_Official_Visual_Dec2015The break-up of McLaren and TAG Heuer after 30 years was a shame, but given the much broader opportunity that existed at Red Bull, you can see why the deal made so much sense. There is a lot of work that needs to be done to turn the TAG Heuer/ Renault engine into a competitive unit, but with the likes of Illien involved, TAG Heuer’s level of exposure in Formula 1 is about to go to the next level.

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