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Formula E electric series has a new charge

LONDON (Reuters) - The Formula E electric racing series will carry more of a charge into its third season.

Alejandro Agag, CEO of Formula E, is pictured before a news conference in Beijing, September 12, 2014. REUTERS/Jason Lee

While new teams, drivers and venues prepare for the start in Hong Kong next week, the loss-making championship is moving closer to the Formula One model of charging hosting fees for races.

“It’s a transition year where we are removing some races and including some new races and of course a lot of things are coming into consideration,” chief executive Alejandro Agag told Reuters on Tuesday.

“Before we used to go to the cities and take all the costs. Now we expect the city to cover part of those costs and that transition always has some moments of, let’s say, imperfection,” added the Spaniard.

That has meant a gap between the second race in Morocco’s Marrakesh on Nov 12 and the third in Buenos Aires on Feb 18. There is another before Mexico City on April 1 and rounds five and nine are to be confirmed.

Agag was unconcerned and said the 2017-18 season would likely start in November with races in December, January and February.

“We are seeing now that there is a lot of competition between cities. If we were taking the costs, we could go to 300 cities in the world. Everyone would welcome us,” he said.

“That’s the model we did in the beginning to get the championship going. Now we expect either local promoters or the cities to cover most or all of the costs of staging a race.

“If you want to race, you have to pay for it. That’s the message.”

Formula E made a pre-tax loss of 43.8 million pounds ($57.00 million) in the year to July 31, 2015 on revenues of 14.8 million. Break even is not expected until at least 2017.

While Formula One can charge around $40 million for races in oil-rich venues like Abu Dhabi and Azerbaijan, Formula E has nowhere near the clout and not all races have local promoters.

London is absent, after local residents blocked the use of Battersea Park, but Agag hoped it would return for season four.

“The financial aspect is obviously important, we have some positive conversations going on in that direction,” he said. “Maybe not directly with the city, but other possibilities institutionally that finance the development and promotion of electric cars.”

The series has more manufacturers, with Jaguar the latest and BMW taking a close look at whether to enter a factory team from 2018. Renault, Citroen’s DS brand, Audi and India’s Mahindra are also involved.

“I think Formula E is in the best moment of its young life,” said Agag.

Reporting by Alan Baldwin, editing by Pritha Sarkar