The government has denied the McLaren Formula One team a £150m loan request for aid amid the Covid-19 pandemic.
Sky News reported that the Department for Business, Energy and Industrial Strategy had communicated with the McLaren Formula One team to inform them of their decision to reject a request for a £150m loan that would help the team get through the Covid-19 pandemic.
The pandemic has hit the McLaren brand heavily. A fast decline is luxury spending since the start of the pandemic has affected its sales of its McLaren sports cars it sells to consumers. Additionally, the threat that F1 may not return for the 2020 season has put its F1 division in unease going forward.
The McLaren group issued a statement following the denial of its loan from the government.
“Like many other British businesses we have been severely affected by the current pandemic.” a spokesperson for McLaren said.
“We are, therefore, in continued dialogue with our banks, investors and government to help navigate short-term business interruptions.”
At the beginning of April, McLaren announced that it would temporarily furlough some of its Formula 1 team members while drivers Carlos Sainz and Lando Norris, along with senior management, would take a pay cut to help McLaren weather the storm of the pandemic.
“It’s still not clear yet and it’s simply impossible to know what the financial impact will be of this crisis,” McLaren’s Seidl said last month.
“We know that we are not going racing at the moment. We know that we will miss income this year, and this is why we had to put different measures in place in order to make sure we are protecting our people, [and] protecting the team to be in a position that once this crisis is over, to restart again in the best possible shape.”