Another lost French football giant?

While the world shifts from club football to world cup and continental cup qualifiers during the international break, big news is being ignored in European club football. Lyon are in serious trouble and may even be relegated to Ligue 2 in the French Football System. 

Almost eleven months ago, Lyon were in danger of being relegated to Ligue 2. They sat bottom of Ligue 1 at 10 points in 15 matches, a whopping 26 points behind leaders PSG. Many people thought Lyon was a done deal after they shipped off Dembele, Barcola, Lukeba, and tons more talent in the summer transfer window. A coach carousel, scouting failure, and terrible negotiations in the past few years sunk Lyon from Champions League to non-Euopean caliber. Lyon have lost tons of money since their golden years and were even hesitant to part with multiple coaches last season despite both of them being unable to lift them out of rock bottom of the league. Lyon eventually hired a manager who took them out of the relegation zone last season and who has started the 24-25 season decently, but with continuous free transfers, money owned to players and coaches, and a lack of a recent cash injection from a multi-club ownership group, it seemed inevitable that sanctions would eventually arrive at OL Lyon. 

The French financial play regulators (DNCG) are known to be notoriously strict, and Lyon’s desolate financial situation finally triggered their sensors. They have not been give a points deduction but a provisional relegation, meaning that if they don’t get their financial situation under control, they will be relegated to Ligue 2, even if this time they don’t sit close to rock bottom. Lyon have reported acquiring over 500 million euros in debt, although that number could be greater if Lyon are hiding any debt from the public. Their American-based ownership group, which owns large stakes in both Crystal Palace and a currently successful Botafogo, is hoping to be able to close the gap through the other clubs’ revenue without selling any of Lyon’s biggest players.

However, the DNCG has placed a transfer sanction on Lyon, meaning that if they do choose to sell players, they will not be able to immediately replace them in the January transfer window until they are cleared. The question is if they are not able to raise money from the ownership group’s other clubs, how will they build up enough to present a stable financial situation to the DNCG. Their current squad value is around 240 million euros, which is a far cry from the 500+ million they currently have in debt. Their revenue from last season is over -100 million euros, meaning that they spent over 100 million euros more than they sold. 

If Lyon wants to avoid following the same fateful path as many of their former rivals, including Bordeaux, the team that broke their championship streak only 16 years ago, the American ownership group must get innovative to right the ship financially and find a way to redesign the club as one that generates young talent to sell for profit, not as one that buys expensive players from other clubs just for them to lose value by the time they are sold.