The tourism state-owned enterprise holding, InJourney, plans to remove the World Superbike (WSBK) from the Mandalika Circuit because it causes a loss of up to Rp100 billion.
The Main Director of InJourney, Dony Oskaria, said the World Superbike is the biggest contributor to the circuit’s losses, as this event is deemed unattractive for investors to become sponsors.
“We are in negotiations to eliminate it,” he said on Wednesday, 14th June 2023.
Moreover, the company’s losses are also sourced from holding MotoGP because the income from advertising and other sources is smaller than the operational costs.
According to InJourney’s calculations, the loss due to the implementation of MotoGP reached Rp50 billion.
“However, this event attracted enough sponsors, so it could still be held,” he added.
These steps are being taken to reduce the Mandalika Circuit‘s debt, which currently stands at Rp4.6 trillion. The debt is divided into short-term payment obligations worth Rp1.2 trillion and long-term obligations worth Rp3.4 trillion.
InJourney, through PT Indonesia Tourism Development or the Indonesia Tourism Development Corporation (ITDC), is requesting State Capital Investment (PMN) of Rp1.19 trillion from the government to fulfil the short-term payments. Of that amount, Rp1.05 trillion will be used to pay off the debts of the Mandalika Circuit.
“Frankly, I cannot fulfil this short-term obligation, including paying for the construction of the Grand Stand, and VIP Village, as well as the need for working capital when organising events. Therefore, the settlement must be done with equity,” he concluded.