Madrid: The Valencia regional government is negotiating with Formula One chief Bernie Ecclestone to try and cut the cost of staging the city`s grand prix, president Alberto Fabra said on Thursday.
According to local media, the heavily-indebted Valencia administration pays around 20 million euros (16.5 million pounds) to stage the European Grand Prix and agreed a 10-year contract last June.
However, the region is under pressure to make deep budget cuts as part of a wide-ranging austerity drive by Spain`s central government and Fabra said he was seeking "a substantial cost reduction."
"We are looking at various alternatives that do not constitute a significant outlay," he told Spanish radio.
"At the same time, they would have to serve as an attraction so that a lot of people come to the region," he added.
"We need to find this balance which will be attractive in the current conditions."
Fabra`s bid to cut the cost of the Grand Prix has reportedly created a rift between the regional government and the city administration, led by Valencia Mayor Rita Barbera.
The city has said that the race brings in revenue of 55 million euros and Barbera believes attracting visitors is even more important in a time of economic hardship.