DirtyWorks said:Hello? Is this thing working?
The point is a sports team in a minor sport fired a major sponsor. If I were a global brand looking for a way to advertise, there's no way I'm touching cycling. I can't even be assured at this point whether the deal I make would last.
If a business relationship breaks down to the point that everyone is looking at their contract, that's bad. In this case, doubly bad for cycling.
Umm... sponsors do the same to cycling teams as well. T-Mobile? Heck, individual cyclists break their contracts all the time... and pay the financial penalties spelled out in the contracts when doing so.
The whole point of having a contract isn't that it somehow ensures that both sides will live up to the deal. The point is to protect both sides so that if one side backs out of the deal, the other has protection spelled out through financial penalties to be paid by the side breaking the deal. It's really not meant so much as an incentive to live up to the contract... just protection in case the other side breaks it.
In most business situations, the financial reward to be given if a contract is broken is enough that having it break isn't that big a deal to the side recieving the damages.
If you expect to make a million dollars in profit off a contract, and the damages for breech are a million dollars... who cares if they break it?
I'm sure Mercedes isn't unfamiliar with contracts. If they wanted a binding deal where Leopard couldn't back out, I'm sure they could have arranged it by setting a ridiculous damage dollar amount. It probably would have cost them a lot more money to get Leopard to accept it though. This still doesn't seem like a big deal to me. Contracts being broken is simply not an odd occurrence for any business. There's no way MB wasn't in some way prepared for this possiblity.