Tennis Australia had initially anticipated spending $33 million to host the 2021 Australian Open.
But it now appears these costs have almost doubled with Tennis Australia CEO Craig Tiley confirming they are already at $60 million and are expected to rise.
“I think anyone in this pandemic that has a rainy day fund should be spending it because this is the most rain we’re ever going to have,” Tiley told SEN’s Summer Breakfast yesterday.
“We didn’t budget for quarantine costs, and they are at 60 million already.”
“They are a very very expensive exercise to put on.”Embed from Getty Images
Tennis Australia are set host the biggest sporting event we have seen since the pandemic first arrived in early 2020.
And public health has been a top priority for Tiley, who has been working alongside the Victorian Government for months to finalise plans to bring over 1000 international players and support staff to Melbourne for the tournament.
With chartered flights, a hotel quarantine program, and COVID security measures to be implemented around Melbourne Park, Tennis Australia will likely exhaust its $80 million rainy day fund to ensure the event can take place safely.
And with reduced gate numbers and sponsors unable to activate on the Open’s delayed start time, Tennis Australia is also likely to take a big hit on revenue this summer.
“Then we have our normal costs with the event, and our revenue is going to be less because you know we’re only going to have 25-50% fans. Ticketing is at halfway, some of our partners can’t activate, we lose a bit of that,” said Tiley.
“We’re going to make less revenue, have the same costs and have increased costs.”
Tiley recently agreed a deal with Nine Entertainment that would see the television company receive a 10% discount on the TV rights for the Australian Open.
“We had a reserve we built up really well over the last ten years, particularly the last five and that’s going to cover a lot of it. We’ll be taking a loan, and that will put us in debt obviously, but we think it’s important and we can pay back that loan over the next several years.”
“We’ll need that loan to survive.”
“The Victorian government have been magnificent in supporting some of the costs of quarantining, which were costs we didn’t anticipate.”
The overriding need to keep the Victorian public safe from the coronavirus pandemic indefinitely justifies Tennis Australia’s additional disbursements.Embed from Getty Images
A big lift for Victoria
The Australian Open will also bring a massive boost to the Victorian economy.
Businesses across Victoria have suffered dearly this year after severe lockdown measures were placed on Melbourne and Victoria following a surge in coronavirus cases.
“Last year we brought 380 million of direct economic impact to Victoria. We’re not going to bring that same amount this year, because we don’t have the international visitors, but we’ll bring a lot of it, three-quarters of it hopefully. So there is an economic impact to our event happening.”
That will still be around 285 million dollars coming into Victoria’s economy; a massive bonus to the state and Australia as a whole.
“But most importantly, there will be a billion people around the world watching what happens here in Melbourne.”
“The Australian Open can be used as a magnificent marketing and promotional tool for our country… and we are certainly going to use it for that.”
Tiley also reaffirmed that the major down under would also focus on “promoting all the local produce and local support of the event globally.”
“We think we will have an impact on showcasing Australia as one of the best nations in the world on how to do things, and that’s an opportunity we didn’t want to mess up, so it was worth going through the pain and the risk in order to be able to deliver on that,” said Tiley.
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