Raising the stakes helps racing industry

Lance O'Sullivan says there will always be horse racing, even in tough times. Photo / Greg Bowker

The prize money up for grabs at Auckland Cup Week this week highlights the benefits of changes to racing in New Zealand, industry figures say.

The New Zealand Derby at Ellerslie yesterday had a winners purse of $2.2 million - up from the $700,000 previously on offer.

An injection of $9 million of Government funding over the next three years means stake money of $1 million at four thoroughbred races - the Derby, Wednesday's Auckland Cup, Telegraph Handicap and 2000 Guineas.

New Zealand Bloodstock's marketing director, Petrea Vela, said changes to the racing industry tax regime several years ago and increases in winners stakes had revived confidence in the industry.

She said the result was fewer horses heading overseas as local buyers stepped up to pay for top quality horses and race them here.

Auckland Racing Club chief executive Chris Weaver said several of yesterday's Derby starters had overseas owners who had chosen to race in New Zealand.

"Historically those horses would have been gone, they would have left our shores and those horses would already be up in Hong Kong and Australia." said Weaver.

He pointed to the Hong Hong owner of late entry Puttanesca being prepared to pay a penalty fee of $66,000 for a shot at the millions on offer.

The most recent set of economic data, released in 2004, revealed the racing industry directly contributes $424 million to GDP, with another $1 billion generated by related activities.

Vela said a slowdown in the economy had taken a toll on the yearling sale at Karaka, with sales down 25 per cent on 2008, but qualified that by saying it was still higher than the previous record year of 2007.

"There's no question when you're dealing with a luxury item and relying on people's discretionary spending that certainly we're going to be feeling it," Vela said.

She said the price falls were consistent with a global trend which could give cashed-up buyers the opportunity to purchase overseas bloodstock.

Legendary jockey Lance O'Sullivan said people had to become more realistic about the prices they could achieve for bloodstock.
"When hard times fall upon us the first thing to go is the beach bach, the boat and the horse."

Weaver said the Auckland Racing Club, which runs Ellerslie, had felt the effects of belt-tightening as corporates switched their race-day presence from a large marquee to taking a couple of tables in the grandstand hospitality areas.

"We've had the same number of people who have pre-bought hospitality as last year, they've just bought different packages," said Weaver.

O'Sullivan was certain the industry would survive the downturn. "There will always be horse racing. We've seen good times and we've seen bad times. It always carries on."