The huge cost of Man Utd missing out on the Champions League
Erik ten Hag's team faces a daunting challenge to secure a return to top-tier European competition, as failure to do so could spell financial trouble for them. Thirteen years ago, Manchester United clashed with Chelsea in a pivotal Champions League quarter-final match at Stamford Bridge. Fast forward to Thursday, and United find themselves in a similar situation, needing a victory against Chelsea to keep their hopes alive for next season's Champions League qualification.
Both clubs, once regular contenders in European football's elite tournaments, have seen a significant decline in recent years. Chelsea, currently sitting 12th in the Premier League, are almost certain to miss out on European football altogether this season. Meanwhile, Manchester United's campaign has been marred by disappointing performances, including finishing at the bottom of their Champions League group.
Although Chelsea's European hopes seem bleak, there remains a glimmer of opportunity for Manchester United to secure a return to the prestigious tournament, despite their recent lackluster draw against Brentford.
With the Champions League set to expand next season, Manchester United could secure qualification with a fifth-placed finish. Despite trailing Tottenham by nine points, a victory at Stamford Bridge would narrow the gap to six. Given Tottenham's reputation for faltering under pressure, there's a possibility that United could overtake them and secure Champions League qualification unexpectedly.
However, if this scenario doesn't unfold, the consequences for the club could be significant. Missing out on Champions League football could lead to financial challenges and missed opportunities for growth. The true cost of Erik ten Hag's side failing to qualify for the Champions League would be substantial.
What Happens if United Misses out on Champions League
- No access to a €2.5 billion prize pot
Qualifying for this season's Champions League meant that Manchester United, among 32 other teams, received a share of approximately €2.1 billion (£1.8bn/$2.3bn) distributed by UEFA to participating clubs.
With the expansion of the competition next season, the prize pool is expected to increase to around €2.5 billion (£2.1/$2.7bn). This expansion was agreed upon to counter the threat posed by the European Super League. Under the new format, 36 teams will compete, leading to an additional 64 games.
The amount each club earns under the current format is determined by various factors, including their performance in the competition, the size of their country's television market, and their 10-year coefficient, which is calculated based on past performances.
For instance, last season's champions Manchester City received €134.9 million in prize money (£115m/$145m), while Real Madrid, who were eliminated by Manchester City in the semi-finals, earned the second-highest amount of €118.8 million (£101m/$149m), surpassing even the finalists Inter Milan.
- Colossal contrast to Europa League
Sevilla, on the other hand, earned a relatively modest €21.8 million (£19m/$23m) for winning the Europa League last season. This amount pales in comparison to what thirty other teams earned simply by participating in the Champions League.
Despite Manchester United's disappointing performance in this season's Champions League, they still stand to earn up to €60 million (£51m/$64m) from UEFA. This is nearly double the €32.6 million (£27m/$35m) they received for reaching the quarter-finals of the Europa League last season, during which they played 12 matches.
Under the new Champions League format, teams are guaranteed €18.6 million (£15m/$20m) just for qualifying, which marks a €3 million (£2.5m/$3.2m) increase from this season. In contrast, teams in the Europa League are guaranteed only €4.1 million (£3.5m/$4.4m).
There's also a substantial disparity in the money awarded for winning matches. In the Champions League, each group stage victory is worth €2.1 million (£1.8m/$2.2m), with a total of eight matches under the Swiss Model format. Qualifying for the knockout phase, whether by finishing in the top eight or through the play-off round, earns a further €11 million (£9.4m/$11.8m).
In comparison, a victory in the Europa League is worth only €450,000 (£385k/$485k), while qualification rewards just €1.75 million (£1.5m/$1.8m). Therefore, if Manchester United were to qualify for the Champions League and win all eight group stage matches, they would earn a total of €46.4 million (£40m/$50m) in prize money. In contrast, achieving a similar feat in the Europa League would only yield €9.45 million (£8m/$11m). This potential difference amounts to €36.95 million (£31m/$39m).
- Lower matchday revenue
It's evident that Champions League matches hold greater appeal to fans compared to Europa League games, leading to reduced ticket sales and lower television revenue for clubs missing out on the elite competition.
In their recent financial reports, Manchester United disclosed a significant boost in broadcast revenue of £52 million ($65 million) between July and December 2023, compared to the same period in 2022. Additionally, they saw a rise in matchday revenue by £23.8 million ($29 million). These increases can be directly attributed to their participation in the Champions League.
With next season's Champions League format offering an extra home game and the potential for a play-off round if United finish between ninth and 24th in the table, the financial consequences of failing to qualify for European football's premier club competition would be even more pronounced for the club.
- Pay cuts for players
If Manchester United fail to qualify for the Champions League, there will be some relief for the club's accounts as players are expected to face a 25 percent pay cut. This measure was implemented the last time United missed out on Europe's premier competition, meaning players like Bruno Fernandes, Marcus Rashford, and Luke Shaw could experience a second pay reduction in three years.
For instance, top earner Casemiro's weekly wage would decrease from £350,000 to £262,500, while Rashford's earnings might fall from an estimated £300,000 to £225,000. Captain Bruno Fernandes would see his weekly wages reduced to £180,000.
Although these players wouldn't necessarily face financial strain, some might consider moving away to mitigate the impact of their reduced salary, particularly if they doubt United's immediate return to the Champions League the following season.
It's widely known that Paris Saint-Germain has shown interest in Rashford, and they could offer him consistent Champions League
- Struggling to attract top talent
Money isn't the sole motivating factor for players; the allure of competing in the Champions League holds immense significance for aspiring footballers. Unfortunately, Manchester United's track record in securing Champions League qualification has been inconsistent over the past decade, with only three appearances in the knockout stage.
This inconsistency has hindered the club's ability to attract top talent. Despite making efforts to sign promising young players like Jude Bellingham and Erling Haaland, both opted for Borussia Dortmund over United. Dortmund, although a smaller club in stature, offered guaranteed Champions League football—a crucial platform for players to showcase their skills on a global stage.
United's failure to consistently qualify for the Champions League not only impacts their ability to attract top-tier talent but also diminishes their appeal as a destination for aspiring young stars looking to climb the ranks in world football.
Qualifying for the Champions League holds added significance for United due to their precarious financial position, both in European and domestic competitions. The club was fined €300,000 by UEFA last year for a minor breach of financial fair play regulations and must adhere to similar rules next season, including UEFA's new squad cost ratio.
Meeting these financial obligations is crucial, especially considering the Premier League's Profitability and Sustainability Rules, which impose strict limits on club losses over a three-year period. United have already spent significant sums in recent years, leaving little room for financial leeway.
New minority owner Sir Jim Ratcliffe has emphasized the importance of Champions League qualification for meeting financial obligations, although he acknowledges the need for a longer-term vision to implement structural changes within the club. Ratcliffe has highlighted the necessity of securing Champions League football as part of a two to three season challenge to revitalize the organization and achieve sustainable success.
