The Economic Impact of the Formula 1 Las Vegas Grand Prix

Siddharth Yerapotini

The introduction of the Las Vegas Grand Prix in 2023 to the Formula 1 calendar marked a significant addition to the city’s portfolio of major events, promising a substantial boost to the local economy. Given its status as a city synonymous with entertainment and tourism, Las Vegas has long leveraged large-scale events to drive economic growth. The arrival of Formula 1, with its global appeal and high-spending fanbase, generated immense anticipation regarding its potential to enhance the city’s economic landscape — the bright lights of Las Vegas and the glamour and popularity of Formula 1 were simply a match made in heaven. In this article, we’ll dive into the multifaceted economic effects of the Las Vegas Grand Prix since its inception, discussing job creation, revenue generation, funding mechanisms, social media impact, long-term implications, and comparisons with other major events hosted in the city — of which there is no shortage.

Quantifying the Economic Influx

Overall Economic Impact in 2023 and 2024

The inaugural Formula 1 Las Vegas Grand Prix in 2023 generated a reported economic impact of approximately $1.5 billion.¹ This figure includes the significant initial investment by F1’s parent company, Liberty Media, which amounted to $500 million for the acquisition of 39 acres of land and the construction of the four-level pit building that now stands as Grand Prix Plaza.⁴ In its second year, 2024, the economic impact was reported to be $934 million.⁴ The decrease in the overall figure can be largely attributed to the absence of the one-time infrastructure spending that characterized the first year.⁴ Despite this reduction, the 2024 economic impact still positions the Las Vegas Grand Prix as the largest recurring mega-event hosted in Southern Nevada⁴ and remains comparable to the estimated $1 billion economic impact of Super Bowl LVIII, which was also held in Las Vegas in February 2024.⁴

Year	Overall Economic Impact	Visitor Spending	Event-Specific Spending
2023	$1,500,000,000	$884,000,000	$556,000,000
2024	$934,000,000	$336,000,000	$556,000,000

Note: Visitor spending for 2023 is net visitor spending⁶, while for 2024, it is also net visitor spending after accounting for displacement.⁷ Event-specific spending for both years includes vendor and employee wages and infrastructure expenses.⁴

Direct and Indirect Revenue Streams

A significant portion of the economic benefit was derived from visitor spending on non-race-related activities. Attendees at the Grand Prix in 2024 stayed an average of 3.7 nights and spent over $2,400 each on accommodations, food and beverage, shopping, local transportation, gambling, and entertainment.⁴ This expenditure does not include the cost of Grand Prix tickets, thus reflecting the direct economic benefits to Las Vegas from visitor spending outside of the race itself.⁴

Clearly, fans who traveled to Vegas to experience the thrilling Grand Prix also indulged in the various other activities that Vegas is iconic for, illustrating the widespread impact of the event. Examining the Grand Prix itself, event-specific spending in 2024 amounted to $556 million, which included $220 million spent on vendor and employee wages and the remaining $378 million allocated to event infrastructure, operations, and hosting.⁴

Hotel occupancy rates during the Formula 1 weekend in 2024 reached 87 percent, an increase from the 80 percent recorded during the 2023 event.⁴ This rise indicates a growing appetite for Formula 1 within the city.⁵ However, it was clear that the economic benefits were not uniformly distributed across all resorts. Revenues were higher for properties located inside the 3.8-mile racecourse that ran on Las Vegas Boulevard, Koval Lane, and Harmon and Sands avenues,⁴ demonstrating that Formula 1 truly brought heavy tourism to Vegas – even more than the other facets that make Vegas such a popular destination.

Job Creation and Workforce Impact

Direct Employment Opportunities

The Las Vegas Grand Prix has also served as a catalyst for job creation within the local economy. In 2024, the event supported 4,502 jobs in Southern Nevada.⁴ These positions encompassed a range of roles, including those in hospitality, security, logistics, and marketing, as well as jobs related to the infrastructure and operational aspects of the event.⁶ While specific job creation figures for 2023 vary across reports, with one mentioning over 7,700 anticipated jobs¹⁰ and another citing approximately 2,200 jobs related to race infrastructure development¹¹, the focus on 2024 indicates a significant ongoing contribution to local employment.

Type of Impact	Number of Jobs	Total Salaries and Wages (USD)
Direct	2,790	Included in total
Indirect	1,712	Included in total
Total	4,502	284,000,000

Note: The table reflects data from the 2024 Las Vegas Grand Prix economic impact report. From my research, the 2023 Grand Prix had even greater employment opportunities, given that it was the inaugural event.⁴

Indirect and Induced Employment

Beyond the direct employment associated with the race, the Grand Prix also stimulates indirect and induced employment. The spending by Formula 1, the Las Vegas Grand Prix organization, their partners, and the visitors supports a network of suppliers and businesses within the local economy.⁷ This includes vendors providing goods and services for the event, as well as local businesses where employees of the Grand Prix and visitors spend their wages.⁷ In 2024, the total salaries and wages infused into the local workforce due to the Grand Prix reached $284 million.⁴ This substantial figure highlights the broader economic impact on the community, extending beyond those directly employed by the event and into local businesses as well.

Funding the Spectacle: Investments and Resources

Private Investment by Formula 1 and Liberty Media

Liberty Media, the parent company of Formula 1, has made substantial private investments to bring the Grand Prix to Las Vegas. This includes the purchase of a 39-acre site near the Strip for $240 million in 2022 when the venue was announced as a future Formula 1 track and development began.⁴ On this land, they invested approximately $260 million in 2023 to construct the permanent pit building and other infrastructure for the race, with total infrastructure investment potentially reaching close to $1 billion.¹ These investments demonstrate a significant long-term commitment to the event.

Furthermore, the development of Grand Prix Plaza is intended to be a year-round attraction, featuring experiences like F1 X, F1 Drive, and F1 Hub, which will continue to contribute to the local economy and maintain interest in Formula 1 even beyond the race weekend.¹ Even if the Vegas Grand Prix were to be removed from the Formula 1 calendar at some point, these attractions would remain, generating economic activity for decades to come.

Public Sector Involvement

While most of the funding for the Las Vegas Grand Prix has been private, there has been some involvement from the public sector. Notably, there was a reported request in 2023 for $40 million in public funds from Clark County to assist with an estimated $80 million in infrastructure upgrades needed for the inaugural race.¹² The Las Vegas Convention and Visitors Authority (LVCVA) has also played a role, reportedly entering into a three-year deal in May 2022, valued at $19.5 million, to support the Grand Prix in 2023, 2024, and 2025.¹ 

Additionally, Clark County provided the use of approximately 3.8 miles of public roads that constitute the race circuit at no cost to Formula 1.¹³ This public sector involvement highlights a collaborative effort to support this event, given its potential for significant economic returns for the region over several years.

The Social Media Halo Effect

Celebrity Influence and Online Visibility

The Las Vegas Grand Prix has been widely viewed as a premier event attracting a high-profile audience, including numerous celebrities from various fields such as Hollywood, sports, music, and social media.¹⁴ The presence of figures like Gordon Ramsay, Adele, Justin Bieber, Leonardo DiCaprio, Brad Pitt, Shaquille O’Neal, Rihanna, and many others generated considerable excitement and media attention.¹⁴ These celebrities often shared their experiences on social media platforms, reaching their vast followings and further amplifying the event’s visibility and Las Vegas itself.¹⁴

The unique backdrop of the Las Vegas Strip, with its iconic hotels, vibrant lights, and the spectacle of Formula 1 cars racing through the heart of the city, provided visually compelling content that resonated widely online.¹ In addition, the utilization of the Las Vegas Sphere, which was used to play the Formula 1 Intro, creative videos “watching” the cars drive by, and special visualizations — all brought even greater attention and dazzle to the spectacular event..

One example is the celebration of legendary driver Max Verstappen’s 4th World Championship (which he won at the 2024 race). This iconic combination of a globally recognized sporting event, a glamorous location, and celebrity endorsements created a significant social media buzz, enhancing the global profile of both the Grand Prix and Las Vegas as a leading entertainment destination that is poised to grow in the coming years of exciting Formula 1 action.

Media Impressions and Publicity Value

The social media impact of the Las Vegas Grand Prix has been substantial. From November 18 to 26, 2024, the event generated 33,700 stories and over 706 billion impressions, with an estimated publicity value of $6 billion for the destination.⁸ Over the same period, social media reach related to F1, Las Vegas, and the race reached 3.9 billion.⁸ In 2023, the race week reportedly recorded 16 billion global social media impressions.¹⁵ The LVCVA calculated that the inaugural event produced 48.6 billion worldwide impressions.¹⁶ 

These figures significantly surpass the typical annual media impressions for Las Vegas, which usually range between a relatively modest 3 billion and 6 billion.¹ Some reports even suggested that the announcement of the Las Vegas Grand Prix generated four times more social media activity than the announcement of the 2024 Super Bowl in the same city.¹⁷ 

Given how the Super Bowl is largely an American event while Formula 1 is still growing in the U.S., this figure illustrates just how immense the impact of the Vegas Grand Prix is. This level of online engagement underscores the Grand Prix’s effectiveness in capturing global attention and generating significant publicity for Las Vegas.

Long-Term Economic Prospects and Challenges

Sustainable Growth and Recurring Benefits

Formula One has expressed a clear intention to establish a long-term presence in Las Vegas, with reports indicating ongoing talks between the Las Vegas Convention and Visitors Authority and F1 regarding a long-term deal that could extend through the mid-2030s.² This commitment suggests that the Grand Prix is envisioned as a recurring annual event that will continue contributing to the local economy for years to come. 

The year-round operation of Grand Prix Plaza, featuring F1-inspired attractions, may also play a crucial role in sustaining interest in the sport and providing ongoing economic benefits to the city beyond the race weekend.¹ Furthermore, infrastructure improvements made for the race, such as road repaving and utility upgrades, can potentially enhance the city’s infrastructure in the long term, benefiting residents and visitors alike.⁴

Advantages Specific to the Las Vegas Track

Economically speaking, one of the most significant advantages of the Las Vegas track, even relative to other Formula 1 tracks, is that it is a “street track.” Essentially, unlike many of the other circuits around the world, such as Silverstone Circuit in England or Autodromo Nazionale Monza in Italy, which are permanent racetracks, the Las Vegas Strip Circuit is composed of the streets of Vegas itself — it is not a purpose-built racetrack. This entails that after the Grand Prix weekend is completed, while the other circuits can only be used for other racing series occasionally throughout the year, the Vegas circuit can be reverted to public roads and home for local businesses again until the next year’s Grand Prix.

Additionally, relative to other Formula 1 street tracks, a significant advantage that the Vegas Strip Circuit offers is that it delivers a substantially more entertaining race experience filled with thrilling overtakes and ingenious strategies. An issue with many street circuits on the Formula 1 calendar, such as Circuit de Monaco and the Baku City Circuit, is that due to their reliance on regular streets, they are too narrow and lead to potentially boring races with little to no action or overtaking. Vegas is the exception to that, having provided thrilling races and nonstop action in both the 2023 and 2024 races. 

In 2023, the historically dominant Max Verstappen won a hard-fought race, while fellow podium finishers Sergio Perez and Charles Leclerc battled until the finish line — with plenty of action behind them as well. In 2024, the action picked up where it left off, and Vegas was able to witness the crowning of 4-time World Champion Max Verstappen. These dramatic, action-packed races ensure that this race will never lose its appeal and will continue to provide the significant economic activity it has brought in its first two races.

Perhaps most importantly, during the Grand Prix itself, viewers of the race, both in-person and online, can easily observe local businesses as the cars traverse the circuit and approach famous buildings within the city, offering free advertising and enhancing the outreach of Vegas entrepreneurs.

Potential Drawbacks and Disruptions

Despite the significant economic benefits, the Las Vegas Grand Prix has also presented certain drawbacks and disruptions, particularly for local businesses and residents. The extensive setup and teardown phases, along with road closures during the race weekend, have been frustrating and have reportedly led to revenue losses for some businesses, especially those directly affected by the circuit layout.¹ Several corporations even filed lawsuits against Formula 1 and Clark County, claiming millions of dollars in lost revenue due to the race.¹⁸ 

Additionally, economists have raised concerns about the methodology used in economic impact reports, arguing that they often focus on gross spending rather than actual net gains and may not adequately account for negative spillover effects.¹⁸ While the inaugural year in 2023 faced some teething issues and logistical challenges, improvements were made in the second year to minimize disruptions.¹ 

However, as demonstrated by the statistics in this article, the gains from this exciting event more than offset these disruptions, and as Formula 1 returns to Vegas year after year, these processes will inevitably be smoothed out.

Las Vegas vs. the World: Comparative Economic Impact

Benchmarking Against Other Major Sporting Events

The economic impact of the Las Vegas Grand Prix can be benchmarked against other major sporting events hosted in the city. Super Bowl LVIII, held in Las Vegas in February 2024, generated an estimated $1 billion in economic impact.⁴ The inaugural Las Vegas Grand Prix in 2023 reportedly surpassed this figure with its $1.5 billion impact,¹ proving that Formula 1 events can provide significant economic benefits through tourism, hospitality, and global exposure.⁹

Event	Year Held in Las Vegas	Reported Economic Impact (USD)
Las Vegas Grand Prix	2023	1,500,000,000
Super Bowl LVIII	2024	1,000,000,000
Las Vegas Grand Prix	2024	934,000,000

Contextualizing with Other Las Vegas Mega-Events

In addition to major sporting events, Las Vegas also hosts numerous large-scale conventions that contribute significantly to its economy. The Consumer Electronics Show (CES), an annual multi-day event, has historically reported a substantial economic impact on the city, with figures reaching billions of dollars over its history and hundreds of millions annually.⁴ 

While the Formula 1 Grand Prix delivers a significant economic impact within a single weekend, the cumulative effect of various conventions held throughout the year is also a crucial component of Las Vegas’s economic vitality. The nature and duration of these events cater to different audiences and generate varied patterns of economic activity. 

Formula 1 is attempting to spread its influence into both fields, though, with its newly built attractions in Vegas that run year-round for fanatics to experience the thrill of the fastest cars in the world.

Tax Revenue and Community Contributions

Generated Tax Revenue

The Las Vegas Grand Prix has proven to be a significant source of tax revenue for state and local governments. In 2024, the event generated $45 million in tax revenues.⁴ This figure was higher in 2023, reaching $77 million.¹ The tax revenue generated in 2024 included contributions from live entertainment taxes, room taxes, sales and use taxes, gaming-related taxes, property taxes, and commerce taxes.⁴ 

This revenue stream benefits various entities, including the state general fund, Clark County’s general fund, and the Clark County School District,⁷ providing a positive social impact beyond tourism and jobs.

Allocation of Funds and Community Benefits

A portion of the tax revenue generated by the Las Vegas Grand Prix is explicitly allocated to community benefits. For example, in 2024, approximately $15-16 million of the $45 million in tax revenue was set aside for schools across the state.⁴ This is a slight decrease from the $22 million allocated to schools in 2023,¹ but it is still an admirable contribution that will continue for years. 

Beyond tax contributions, the Grand Prix organizers have also engaged in other community initiatives, such as donating over 170,000 pounds of food and beverage items to local food banks and hosting local middle school students at the event to provide insights into STEM-related careers in motorsport.⁴ 

The Grand Prix has also spurred investments in vocational training, collaborating with the Clark County School District and UNLV’s School of Engineering to expose 600 students to behind-the-scenes operations and highlighting career opportunities in motorsport engineering and event management. Initiatives like these align with F1’s commitment to fostering local talent and positively impacting the world aside from pure entertainment, ensuring the event’s legacy extends beyond racing and immediate economic gains.

Final Thoughts About The Las Vegas Grand Prix’s Enduring Economic Footprint

The Formula 1 Las Vegas Grand Prix has undoubtedly made a significant economic impact on the local economy since its debut in 2023. The event has generated substantial revenue, created thousands of jobs, and contributed tens of millions of dollars in tax revenue for state and local governments.⁴ The social media attention garnered by the race, amplified by celebrity attendance and the iconic Las Vegas Strip setting, has provided invaluable global publicity for the city.³ 

While the initial year saw a more considerable overall economic impact due to significant infrastructure investments, the recurring nature of the event and the development of year-round attractions at Grand Prix Plaza suggest a promising long-term economic outlook.⁴

However, the Grand Prix has also presented challenges, including disruptions to local businesses and residents, and the economic impact assessments have faced critical scrutiny.⁴ Balancing the economic benefits with these drawbacks will be crucial for the long-term success and acceptance of the event within the Las Vegas community. Great strides have been made in making this a reality in the second year of the Grand Prix, but there is still work to be done.

Comparing the Grand Prix to other major events like the Super Bowl indicates its status as a top-tier economic driver for the city.¹ As Formula One looks to solidify its presence in Las Vegas and the overall United States with a long-term deal, the Grand Prix is poised to remain an integral part of the city’s identity as a global leader in sports and entertainment, leaving an enduring economic footprint on the local landscape.²

Please feel free to reach out with any questions, comments, or concerns at ssyerapotini@gmail.com.

• Siddharth Yerapotini, Freshman at the University of Wisconsin-Madison.

Works Cited

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19. Image Credits: Formula 1 & Red Bull.