In September 2024 Formula 1 signed a multi-year partnership with the LEGO Group. Three weeks later came a global multi-year licence with Mattel for Hot Wheels. Neither deal involved putting a logo on a Formula 1 car. The opposite happened: the cars ended up as LEGO sets, with all ten teams for the first time, and in 1:64 scale die-cast models, on sale from 2025.

It is the clearest example of what licensing in motorsport can do for a brand. People tend to think motorsport is useful to a company mainly as advertising space: a livery, a trackside board, a hospitality area. I read it differently. For anyone who makes consumer goods, in my view, the most direct route is often not to buy visibility on a team’s brand, but to rent that brand and put it on their own products.

What licensing in motorsport is

A licence is a contract in which the owner of a brand, the licensor, allows another company, the licensee, to use it on its own products or services. In motorsport the licensors are championships, teams, manufacturers, drivers and riders, events and circuits. The licensees are the companies that make toys, clothing, accessories, scale models and video games.

The contract sets out only a few things, but all of them are decisive: which products can be made, in which countries and through which sales channels, for how many years, and with what approval process for designs. It also sets the price, which usually rests on two elements: a royalty, meaning a percentage of sales, and a minimum guarantee, a threshold the licensee pays in any case: if the royalties earned fall short of it, the licensee pays the difference.

Licensing and sponsorship: the difference

This is the difference that matters. In a sponsorship the brand pays to appear on the sports property, and the return comes in awareness, relationships and content. In a licence the reverse happens: the sports property appears on the brand’s product, and the return comes from sales of that product. The first is a marketing cost. The second is a revenue line, with a margin out of which the royalties are paid.

Put in commercial terms: sponsorship buys space on someone else’s brand, licensing rents someone else’s brand to sell it alongside your own. The two can also be combined, and that, in my view, is where they work hardest: a company that sponsors a team and also produces a licensed range in its colours tells the same story on track and on the shelf.

What the sports licensing market is worth

According to the 2026 study by Licensing International, the industry’s international association, worldwide sales of licensed products and services reached $389.8 billion in 2025, up 5.45% on the previous year. Among the types of brand that are licensed, sport grew fastest: up 8.5% to $44.4 billion, 11.4% of the market, third behind entertainment and corporate brands.

Motorsport is part of that figure, and the published data from the study do not break it out. Formula 1’s deals with LEGO and Mattel, however, show the direction of travel clearly: product categories far from the paddock and an audience of families, children and adult collectors, reached mainly in shops, as well as in the Grand Prix fan zones.

Who can grant a licence in motorsport

Every level of motorsport has a brand to license. There is the championship, as with LEGO and Hot Wheels. There are video games, which are licences in every sense: Formula 1’s official series is developed by Codemasters, which has held the licence since 2008 and has been owned by EA since 2021, while the official MotoGP game has been developed by Milestone without a break since 2013. Then there are the teams and manufacturers, with their clothing and accessory lines, and the drivers and riders, with their name, number and helmet.

It is with riders that you see best how the mechanism works. In our work we have handled, among others, the licensing contract between VR46, the company that holds Valentino Rossi’s commercial rights, and Packard Bell, and the agreement under which Grimaldi Industry became the Italian licensee of Dovi4, Andrea Dovizioso’s brand. In both cases a rider’s brand moved beyond trackside merchandise: in the first onto a range of laptops, in the second onto the clothes of an Italian fashion label.

Where brands most often trip up

In my view there are four stumbling blocks. The first is signing a minimum guarantee built on enthusiasm rather than on sales data: it is the threshold you pay even if the shelf does not empty. The second is asking for too many product categories, or too few, compared with the ones you can genuinely produce and distribute. The third is underestimating approval times: every design goes through the licensor, and a racing season does not wait. The fourth is tying an entire range to a single rider or driver. Riders move on, teams stay: a contract built on one name can lose value the day that name changes colours.

How we work on licensing

Our work sits in the middle, between the sports brand and the company that wants to use it. We follow it through every stage, strategic, contractual and operational: working out which motorsport property makes sense for a company’s products and markets, putting the two sides in touch, managing the contract and, where needed, adding co-marketing, partnership and sponsorship activities to the licence. The service is described on our brand licensing page.

Sponsorship shows on track. Licensing shows at the till. The best deals show in both places.