Why a fearsome 'electric alliance' has lasting significance

News that Formula E has opened its chequebook and invested in Extreme E might come as a surprise to many. The two FIA-sanctioned all-electric championships both work out of the same building in London. Both were co-founded by Alejandro Agag and both cars - the standardised FE chassis and the ODYSSEY 21 E-SUV used by XE - are built by Spark Racing Technology and share an array of electric motor componentry.

Surely, on a surface level, they were sister series. So why has FE moved this week to become a minority shareholder, with its chief executive Jamie Reigle now on the XE board of directors?

"We're calling it the 'electric alliance'," Agag says to Autosport with a wry smile as he sits next to Reigle, the pair making final visits to the Hammersmith office ahead of the second UK national lockdown.

"The truth is that we have a really close operational cooperation - Formula E has taken some tasks on behalf of Extreme E already. But you never know if a venture like Extreme E is going to consolidate or not until you're a few months or maybe a couple of years into the project. We decided it was a good moment to formalise this cooperation. The alignment is key. The teams having a common objective, it's important."

That common objective is to use motorsport as a platform to bring about action to counteract the climate crisis by hitting a bigger audience than a conventional documentary about the environment might. And Agag is right in his cautious approach as to whether XE will "consolidate".

The off-road racing championship kicks off with its maiden event, a Desert X-Prix in Saudi Arabia, on 20-21 March - a delayed date and in a different location to what was first planned as a result of the pandemic. As highstreets again batten down the hatches, the financial devastation caused by COVID-19 is all too raw. XE launches directly into this headwind.

What's more, Agag came within a hair's breadth of watching his FE brainchild go bankrupt in March 2015. Ahead of only the championship's fifth race, in Miami, he was briefly out of a job and had to use his own money to cover the costs of freight. That was during a period of comparative economic boom. The welcome cash injection into XE during the current uncertainty will help avoid another uncomfortable call to the bank manager.

"Obviously, to have the backing of Formula E, which means to have the indirect backing of Liberty Global and Discovery Communications [FE's majority shareholders], it gives great financial peace of mind to the Extreme E venture," says Agag.

Arguably the two most high-profile names in EV competition have now combined to shape the future of single-seater and off-road racing

It's also a welcome vote of confidence for FE's own piggy bank. Autosport understands that some team sponsors requested refunds of up to 50% from their original contracts for last season, when the championship docked in seven fewer countries than originally planned.

Extrapolate that to FE as a whole, and given the series was hanging in the balance just five years ago, questions have been asked over its financial security. That Liberty Global and Discovery have agreed to the handing over of the coffers suggests the balance sheets are healthy enough.

In his new role as an XE board member, Reigle will have a direct input on where the championship races, the format of the events, the media coverage, growing the audience and the commercial relations.

It's a move that's been, formally, six months in the planning although informally it stretches much further back. When Agag interviewed Reigle to see if he was the right person to replace him as FE CEO - which he was, assuming the role in September 2019 - Reigle wanted to see a plan in which the two would tie together.

"I wouldn't claim that I pitched the idea," says Reigle, "but certainly from the very beginning of the relationship, it's something we talked about given the platforms are so complementary.

"Our vision is common: we want to accelerate the climate agenda, we want to accelerate EV adoption. So there's an enormous amount of synergy that comes from that."

The takeaway from the new alliance is that arguably the two most high-profile names in EV competition have now combined to shape the future of single-seater and off-road racing. They both welcome series to electric racing as that serves to promote the cause, although those newcomers will face a tough ask to dethrone the incumbent kings.

Neither give much away when asked if they have a codified five- or 10-year plan for electric motorsport, but that's not to say there isn't a grand vision. For now at least, it's for their eyes only.

In the medium term, however, it's easy to see how the partnership will work. The direct relationship between XE and FE powertrains means that when the former opens up development in 2023, it's right to anticipate the likes of BMW and DS will move into XE - lamentably, SUV road car sales continue to grow - and rekindle their FE partnerships with Andretti and Techeetah respectively to "piggyback" on the technology. In reverse, Agag expects FE teams to gain a load of information about extreme battery temperature management that will come with XE visiting Greenland and Brazil.

There's also a less tangible outcome of the tie-up. With XE announcing that Formula 1 world champions Lewis Hamilton and Nico Rosberg have both created their own teams to compete, there was a perception that the off-road series was hogging the limelight.

PLUS: Why the latest Hamilton-Rosberg battle won't have the same edge

But Reigle, the former commercial director of Manchester United, says the new partnership dismisses any notion that, as Alex Ferguson coined in deference to Manchester City, XE have become FE's 'noisy neighbours'.