One of the most prestigious and longest running sponsors of the America’s Cup wants some of its money back.
Louis Vuitton, the posh French retailer that has been a primary financial backer of the competition, wants $3 million refunded because so few teams have entered.
Louis Vuitton’s initial sponsorship was for $10 million, according to an America’s Cup source. Its contract was based on at least eight teams taking part in the Louis Vuitton Cup, a round-robin playoff to determine which team will ultimately sail against Oracle Team USA in the America’s Cup championship.
There are three teams entered in the Louis Vuitton Cup: Italy’s Luna Rossa, Sweden’s Artemis Racing and Emirates Team New Zealand.
Since the 1980s, there have been anywhere from 7 to 13 teams taking part in the competition. Several potential challengers — from Korea, France, Australia, Spain and Italy — pulled out of the America’s Cup, many citing the financial burden of competing at sailing’s highest level.
Louis Vuitton can get a $1 million rebate for each team less than six that participate, the Cup source said. That would mean the company is entitled to get $3 million back.
Should any of the remaining teams pull out of the competition — which they have hinted they might do — Louis Vuitton would be entitled to even more money back.
A spokesman for the America’s Cup, which began this week and runs until September, said that Louis Vuitton’s actions were “a very old story.”
Due to a dispute with the regatta director of the America’s Cup, the Italian team has boycotted sailing. That lead to a bizarre scenario July 7 in which Emirates Team New Zealand sailed the race course alone in San Francisco Bay to formally win the first of several matches in the Louis Vuitton Cup.
Bruno Trouble, a former America’s Cup sailor for France who is Louis Vuitton’s ambassador to the America’s Cup, told the New Zealand Herald he is “very upset” that the opening day of the event was overshadowed by Luna Rossa’s no-show. Louis Vuitton will continue to support the regatta financially, but at a reduced rate, the newspaper reported.
“We have a deal,” Trouble said. “We are committed to this event, we are not happy, but we are committed.”
Louis Vuitton has been a Cup sponsor for 30 years. Prior to its sponsorship of the Challenger Series, the teams who took part in the pre-races had to divide the cost of the event themselves.
Louis Vuitton briefly dropped its sponsorship of the Cup in 2007, saying that commercialism had overtaken the competition. Then in 2010, after Oracle Racing won the America’s Cup, Louis Vuitton renewed its sponsorship of the Cup.
“There’s nothing new here,” said America’s Cup spokesman Tim Jeffery.
A Louis Vuitton spokesman was not immediately available for comment. But a Louis Vuitton representative told a New Zealand newspaper that the company was “not happy” with the Louis Vuitton Cup so far.
From the San Francisco Business Times