Manchester United is currently navigating through a turbulent season, with the club’s future hanging in the balance. The Red Devils are perilously close to the relegation zone, sitting just seven points above Ipswich Town, who occupy the 18th spot in the Premier League. This precarious position places the club’s continued participation in the league in serious jeopardy.
If the team’s fortunes don’t improve, United could face a catastrophic financial blow that could drastically alter the club’s operations and prospects. This situation is particularly worrying as it marks the club’s lowest league standing since 1989 when they finished in 11th place. Despite this, the current form suggests that finishing even that high is becoming increasingly unlikely.
Co-owner Sir Jim Ratcliffe seems to be turning his focus to financial austerity measures, overseeing significant job cuts and cost-cutting across the club. However, these measures could soon backfire, particularly concerning Manchester United’s sponsorship agreements.
One of the most significant blows that could strike Manchester United in the event of relegation involves its lucrative deal with Adidas. In July 2023, the club secured a 10-year extension on their kit deal with the German sportswear giant, valued at €108 million annually. Thus, the English giants would earn more than €1 billion throughout the agreement’s duration.
This deal is currently the most lucrative kit sponsorship agreement in Premier League history, surpassing previous contracts. However, reports suggest Adidas has the right to terminate the deal with a one-season notice should Manchester United fall into the EFL Championship.
The potential loss of this sponsorship would be catastrophic for the club. “Adidas could reduce their payments to just €54 million per season if they decide to continue with the agreement post-relegation,” according to reports from The Telegraph. This would represent a significant reduction in revenue for the club, and the loss of such a major sponsorship would further strain United’s financial stability.
The Old Trafford outfit’s current form underscores the dire situation the club finds itself in. The team has struggled with consistency, particularly in attack, where new signings like Rasmus Hojlund and Joshua Zirkzee have yet to make the desired impact. The Red Devils have won only one of their last five Premier League matches, and their lack of goals has made their path to survival increasingly uncertain.
With Ruben Amorim at the helm, the team faces even more challenges. Amorim has openly acknowledged that the club is in a relegation battle, a reality that seemed far-fetched at the start of the season.
After a 2-0 defeat to Newcastle, Amorim expressed his concern for the club’s future. “We are in a relegation fight,” the Portuguese remarked, illustrating the harsh reality facing the team. If the Red Devils continue to struggle, they could fall further into the relegation zone, with teams like Crystal Palace and others hot on their heels.
