The Economics of Professional Road Cycling

Why did cycling become professional as early as the nineteenth century while other sports (such as rugby) and other sport events (such as the Olympic Games) remained amateur until the 1980s? Why are the organizers of the most important bicycle races private companies while in other sports such as soccer the main event organizer is a nonprofit organization? To what extent have bicycle races changed since the nineteenth century? The history of professional road cycling helps answer these and many related questions. Following the introduction, this chapter provides a historical account on the development of professional road cycling, from local races to global sport events; discusses a century of Grand Tours, which have long been epic races stirring up national passions; and details the current organizational structure of professional road cycling. The conclusion draws attention to the fact that cycling reflects long-term economic changes. The chapter is founded on both an analysis of quantitative time series on the Grand Tours and a review of the existing literature on the history of professional cycling.

Although cycling races are usually won on an individual basis, professional road cycling is a sport practiced in teams. This chapter focuses on cycling team’s finances which are in at least three ways very different from the finances of teams in most other sports. First, although cycling teams operate like small businesses, according to the rules of the International Cycling Union, they are not run for profit. As a result, team budgets or team revenue should, in principle, equal team expenses. Second, cycling teams do not have a home stadium or arena. The lack of a home venue, and thus the impossibility of hosting their own cycling races, prevents cycling teams from collecting ticketing revenue, an important source of revenue in most team sports. Third, while revenue from broadcasting rights is a growing source of income in many other sports, it is currently not available to professional cycling teams. As a result, as of 2022, cycling teams are still almost exclusively financed by sponsorship money. In this chapter, we show how team budgets have grown substantially in the past 30 years, and we discuss in detail the different costs and the (potential) sources of revenue to the teams. We take a look at the finances of women’s cycling teams as well.

Sport sponsorship is any commercial agreement by which a sponsor contractually provides financing or other support in order to establish an association between the sponsor’s image, brands, or products and a sport sponsorship property in return for rights to promote this association and/or for granting certain agreed direct or indirect benefits. Since professional road cycling was one of the first sports to be practiced commercially, sponsorship of cycling teams already started in the first editions of endurance races like Bordeaux–Paris at the end of the nineteenth century, and it has grown ever since. Today’s cycling teams are in fact financed almost exclusively through sponsorship. This chapter explains the business-to-business characteristics of sponsorship of cycling teams and shows how the cycling sponsorship market can be very dynamic. The duration and termination of sponsorship of cycling teams as well as a company’s motives to invest in such sponsorship deals are discussed, and the importance of the integration of sponsorship into marketing communication is illustrated. We also analyze the economic return and effectiveness of cycling team sponsorship and of cycling races and conclude with some thoughts on today’s sponsoring challenges in professional road cycling.

TV coverage of road cycling started shortly after World War II with the first live broadcast of the conclusion of the Tour de France at the Parc des Princes in Paris in 1948. During the 1950s, the popularity of Tour de France news programmes grew, resulting in the first live coverage from within the race in 1958 on the legendary Col d’Aubisque. French television began to pay for the right to cover the race in 1956. In the following decades, television coverage of cycling races expanded in duration and scope. In this chapter, we analyse TV broadcasting of road cycling races. We discuss the reasons behind the successful marriage of cycling and television and explain in detail how TV audiences should be understood. We also present relevant data on TV audiences for major cycling races and summarize the findings of four empirical studies. A discussion of the rapid growth in TV coverage of women’s road cycling follows, and we next offer some insights on the economics of TV broadcasting rights. We then conclude with a few thoughts on the future of televised cycling.

Large-scale professional road cycling events are almost always free to access for spectators, but also lead to substantial costs for the organizers. Often they are partly funded by local, regional, or national governments. These events have many benefits, some of which are intangible, such as the pleasure and pride for event visitors or local residents. This chapter looks at the value of the intangible benefits associated with large-scale cycling events. Only four relevant studies were found for a cycling event setting, with analyses for the Ronde van Vlaanderen, the so-called big starts of the Tour de France and the Giro d’Italia, and the UCI Road Cycling World Championships. To estimate the value, all studies used the contingent valuation method (CVM) by asking residents or visitors about their willingness to pay (WTP) for the event. Although the studies substantially differ in aim and setup, all had outcomes with a significantly positive WTP. WTP seems to be higher for users (e.g., visitors of the event) than for non-users, although cycling events also have a substantial value for the latter group. In addition, the two studies that surveyed the general public twice, i.e., before and after the event, found that ex post WTP was significantly higher than ex ante WTP, suggesting that we have to be cautious to generalize empirical findings.

Human capital development in sport, particularly within the sport of cycling, has apparently not been directly addressed in the academic literature. This chapter begins by providing some context on professional cyclist careers and then outlines basic physical and cognitive components of a professional cyclist’s stock of human capital. Available avenues for human capital development for cyclists are also described and the persistence of the cognitive components of human capital is discussed with regard to the cycling coaching and team management professions. Additionally, the practical market exchange of human capital in road cycling has likewise not received much attention in the academic literature. From the athlete supply perspective, there is a small amount of existing research on the topic of professional athlete agents generally, particularly in North-American leagues and international football, but there has been virtually no apparent previous literature produced that has specifically examined the agents or labor markets of professional road cyclists. This chapter sheds some light on the levels of agent utilization and remuneration for professional cyclists based on interviews with industry experts. Finally, while academic discussions of labor market organization and unionization are largely absent for professional road cycling, there have been some material and discussions produced by practitioners and sport advocates that will be recounted and referenced here.

Why is there strategy, not just brute force, in cycling competitions? What are the recurring strategic interactions amongst riders? And what can economists learn from riders’ behaviors? Cycling may be one of the most strategically interesting sports, hence its nickname “chess on wheels.” Professional riders’ performances crucially depend on their interactions with other riders, which may not be the case in some athletics, swimming, or skiing events. Most interactions between riders are not pure confrontation, zero-sum games, as is the case in boxing, fencing, martial arts, or tennis. In cycling, two rival riders may lawfully ally against some third rider, while such three-player interactions do not exist in football, basketball, or soccer. And cycling being an individual sport run amongst teams, it opens up opportunities of strategic behavior both within and between teams. This chapter provides an overview on the main reasons why bicycle races are strategic, and it then presents several game theory analyses of strategic interactions between riders: attack timing strategy, cooperation and noncooperation in breakaways and in the peloton, sprint strategy, and three-player interactions. It is founded on examples of strategic interactions between riders that occurred in the Tour de France, the Giro d’Italia, the Vuelta a España, and other races

In the economics of professional team sports leagues, the concept of competitive balance is well documented. It postulates the necessity of equilibrium between the teams in a league in order to guarantee uncertainty of outcome and thus generate public demand. By contrast, performances and competitive balance are hard to define in road cycling. This is because cycling can be seen as a team sport but the overall team performance usually is of minor importance or even not taken into account at all. A large proportion of cyclists in a race take part in support of another rider, meaning that they do not care about their personal result but instead try to help their team leader(s). Moreover, a team leader generally has one specific objective among a range of possible ones. This chapter deals with the complex issue of modeling performances and competitive balance in professional road cycling. After a brief review of the literature on modeling performances and competitive balance in cycling, an innovative measure is introduced: competitive intensity in cycling. We illustrate this measure with two stages of the 2020 Tour de France, and we discuss its implications.

As soon as sports were organized, competitors started looking for ways to improve their performances. Organized sports competitions were born in the mid-nineteenth century, and pretty soon, it was said that there were “means” that could be used for special performances. Cycling was on the wrong track right from the start. No other sport would turn out to be more outstanding in impossibly hard races than cycling. As a result, doping and professional road cycling have a long intertwined history. In this chapter, first an overview of the most important doping products that were used throughout the twentieth century is presented, such as amphetamines, anabolic steroids, corticosteroids, and growth hormones. By the end of the century, a new wonder product came on the market. The introduction of EPO completely reshaped doping use in cycling. This chapter also illustrates the progress that has recently been made in testing as well as the difficulties that are still encountered. We conclude with an evaluation on where cycling stands today in its continuing fight against doping use.

Similar to many women’s sports, professional women’s road cycling is said to have momentum and to be “booming.” However, the inequalities between women’s and men’s professional racing persist. This gender inequality requires a deeper analysis than an explanation and justification of biological differences. Despite women’s participation in professional road bicycle racing in the late 1800s, women’s road cycling has not progressed linearly and women have been structurally and culturally excluded from professional road cycling. The aim of this chapter is to address what needs to be considered in the discussion on the economics of women’s cycling. The chapter considers a brief history of women’s road racing, the current organizational structure, and the media coverage of the women’s races. The arguments formulated are based on existing literature and original sociological research on gender and labor relations in women’s road cycling. The chapter argues that the consideration of a critical historical perspective and gender relations in discussions on the economics of women’s professional road cycling is imperative to reconstruct the narrative of cycling in a modern era to make gender equity a reality.

Road cycling has its historical roots in four European countries: France, Belgium, Italy and Spain. The five Cycling Monuments as well as the three Grand Tours all take place in one of those four core countries and for decades the vast majority of the cycling peloton consisted of riders from these countries. Things slowly started to change in the 1970s (more riders and teams from other European countries, such as the Netherlands and Switzerland) and 1980s (more riders and teams from non-European countries such as the USA and Colombia). Since the early 1990s, the International Cycling Union has regularly declared that globalization of professional road cycling was a priority. In this chapter, we evaluate this objective and measure the significance of the globalization process in professional road cycling over the 1990–2020 period. The intended globalization is analysed from three perspectives. Globalization at the rider level is measured by a breakdown by nationality of the peloton. We also compare the nationalities of the top 100 riders and the winners of the major cycling competitions over the years to check the significance of globalization at the top level of cycling. Two indicators are introduced to analyse the historical evolution of the globalization of cycling teams: one measuring the international diversity within teams and one measuring the international breakdown of teams. Finally, globalization at the competition level is examined by an analysis of the UCI calendar of professional road cycling races. We conclude with an analysis of globalization in women’s professional road cycling.