Tag Archives: F1 news

Formula One: MISSON WINNOW branding to feature in revised Ferrari livery

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The 2018 Japanese Grand Prix will see Scuderia Ferrari add new branding it’s 2018 challenger in the form of recently formed Philip Morris International brand MISSION WINNOW.

Sneak previews of livery revisions have been published on various social media platforms over the course of the last 24 hrs including #MsportXtra as seen below, with branding set to be added to the rear wing, engine cover, nose, and bargeboards.

The MISSION WINNOW trademark was registered in August this year (further details available here) whilst the specifics regarding products relating to the name are unclear, there are several references to Vaping technologies within the registration paperwork.

Ahead of the 2018 season, Philip Morris International (PMI) had been widely expected to introduce e-cigarette brand IQOS to the Ferrari livery, given its longstanding commercial partnership with the Scuderia (as predicted on here on #JWGP with illustrations from Sean Bull). Whilst IQOS retail stands have become a familiar sight at Grand Prix this season the branding has yet to feature on the car. Presumably, this will have been due to advertising uncertainty in key broadcast markets. With  MISSION WINNOW PMI appear to have discovered a loophole in these regulations.

Similarities between the MISSION WINNOW brand design and choice of colours and PMI brand Marlboro will not go unnoticed.

Timing surrounding the addition of this brand name to the Scuderia’s livery sends a clear message of PMI’s expectations for the remainder of the season….

There is no subliminal message around The MISSION!

Follow MISSION WINNOW on Twitter here

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Formula One: Three Car Teams and Budget Caps

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Formula One 2018 is delivering everything and anything a fan of the sport could imagine. From the #FightForFive, to a Hollywood worthy #SillySeason, to midseason team takeovers, new logos, fonts, and of course the epic theme music from Brian Tyler. Yet bubbling just below the surface political games, regulation frustration, and the adage of money talks, continue to put into question how the sport will evolve in the near future.

Two such pressing topics to explore are the number of seats on the grid heading into 2019, and the evaluation of budget caps with the objective of equalising performance. On the face of it there is no simple solution to either issue. On the topic of budget caps, figures in the region of €200-€250M per season with a soft launch in 2019 followed by a regulated implementation from 2020 onwards have been touted by Ross Brawn and fellow F1 management.  Top flight teams have baulked at the prospect of cutting annual expenditure in half and categorically stated that without significant job cuts the target is not achievable. More efficient teams see the cut as insufficient as the spending to the budget cap would still represent more than double their existing spending capability.

That being said, there is a general acceptance Budget Caps are coming and that they will be good for motorsport in general. Top teams are taking steps to prepare for this more regulated future, as referenced on this site a number of months ago. Taking this preparation one step further, could a budget cap combined with a third car allowance be a solution?

Major costs associated with operating a manufacturer supported Formula One team take the form of fixed costs, these include factors such as facilities & employees. The manufacturing of additional race cars would not have a significant impact on the team’s operating budget. In fact, in many cases, top teams will have 3-4 fully operational race prepared cars before the start of a new F1 season. If top teams committed to operating a third car with no increase in the overall operating budget of the team in essence redirecting development budget to operating a third car, therefore reducing the performance gap to the midfield, F1 could solve the pressing issue of a too many high quality drivers and not enough seats and address the B Class championship regularly referenced when drivers in midfield teams discuss the sport.

In order to reduce the prospect of a single team dominating podium proceedings, restrictions, such as the number of races completed, or championship points scored, could be put in place regarding the experience of a team’s third driver. In addition, a team’s third car could be operated from a separate garage space with an alternative livery to ensure a vibrant look to the grid.

Formula One could mandate the that the top 4 teams in the WCC could be eligible to run a third car with the option to sell this provision should they deem the opportunity not relevant to their operating model. i.e. Should Haas or Racing Point finish 4th in the WCC they could sell their 3rd car allocation to McLaren. Or should Red Bull Racing see their existing model with Toro Rosso to better suit the way in which they go racing they could sell the space to another team.

If Formula One were to explore this route, Ferrari could continue to maintain it’s line up of Kimi Räikkonen & Sebastian Vettel, with Charles Leclerc taking the third car. Mercedes could bring George Russell into the team, Red Bull Racing could not offer Fernando Alonso a seat again, and Renault could bring Esteban Ocon on board alongside Ricciardo and Hulkenberg.

Timed with a budget cap which should limit in-season development for teams running third drivers, the performance gap to the two car teams could be minimised bringing the entire field closer together and sustaining the credibility of young driver development programmes.

Toto Wolff has intimidated Formula One should seriously explore regulations around three car teams, with Liberty becoming the promoter of Formula 2 and the soon to be reborn Formula 3, three car teams may be required to ensure participation remains relevant to the next generation of drivers.

Formula One: Should Red Bull Racing rest Ricciardo?

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With Daniel Ricciardo having announced his decision to leave the Red Bull Racing family at the end of this season, rumours surrounding the security of position with the team for the remainder of the season have started to gather momentum.

Adding fuel to fire, Red Bull junior team, Scuderia Toro Rosso, yesterday posted images of Red Bull development driver Sébastien Buemi completing a seat fitting with the team, leading many to suggest he may take the place of Pierre Gasly in the coming races. With Red Bull Racing having confirmed Gasly will replace Ricciardo in 2019, there would be a clear logic to promoting him now to maximise his time within a new team environment.

Red Bull Racing have all but secured third position in the World Constructors Championship with an advantage of more than 160 points over their nearest rival Renault. In fact, with the FIA applying 2019 entry fees based on points scored in 2018, the team from a financial perspective would do well to reduce the number of points scored between now and the end of the season.

Since Daniel Ricciardo’s contract with Red Bull stems from his time as a Red Bull junior, there is likely to be a certain level of flexibility within the agreement to change his status to development driver. Moving him to Toro Rosso would be less than palatable for Honda as he would gain knowledge of their power unit before moving to the works Renault team in 2019. As such bringing Buemi back into the STR fold for the remainder of 2018 and possibly beyond makes strategic sense.

Taking the logic of Red Bull Racing having nothing more to gain in 2018 in terms of constructor’s championship position and subsequent prize funds, a yet more bold move from the Red Bull Empire would be to move Max Verstappen over to Toro Rosso for the remainder of the season.

In so doing Verstappen would have the opportunity to familiarise himself with Honda power ahead of 2019, and as Red Bull’s leading driver best equip the team in their challenge constructors battle with Racing Point Force India (who in only 2 races have amassed a points tally greater than Toro Rosso has over the entire season)

Alongside the talk of resting Ricciardo, and bringing back Buemi, another increasingly likely piece of the Red Bull 2019 jigsaw is Daniil Kyvat. After a year spent with the Scuderia in a development driver capacity, Red Bull look likely to welcome the Russian back into the fold with open arms.  From Honda’s perspective, the sooner he returns with any knowledge of Ferrari’s trick power unit, the sooner they can interrogate him for their 2019 plans.

The Singapore Grand Prix on paper represents Red Bull Racing’s last opportunity to win a race in 2018. The sporting side of Red Bull will likely leave the line-up unchanged until after this race. The business & strategic planning side should then kick in and make the following changes for the remainder of the season:

Red Bull Racing –

Pierre Gasly

Sébastien Buemi

Scuderia Toro Rosso –

Max Verstappen

Daniil Kyvat

From a personal perspective, I am a huge fan of Ricciardo and what he brings to Formula One, but Red Bull have little to gain from keeping him in his seat for the remainder of this season. There is an opportunity to take a competitive advantage with the suggested driver changes. A team looking to challenge for championships in the next 24 months must take every opportunity presented to them.

Be Bold Red Bull! Be Bold!

Formula One: Arm the Sprinklers!

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Formula One returns to Paul Ricard this weekend for the first French Grand Prix in twenty years. The legendary circuit redeveloped in the early 2000’s under the guidance of former CEO Phillipe Gurdjian, has in recent years become a venue of choice for Formula One tyre development testing and was the logical home for the return of Formula One to its spiritual home of France.

Redevelopment of the Paul Ricard circuit was initially focused on the venue hosting racing testing and development programmes. Succesful completion of this objective came in the form of the FIA awarded the circuit as First Centre of Excellence for Motor Sport Safety. This recognition comes in part due to the layout of the circuit, it’s approach to run off areas and ability to sustainably simulate dynamic weather situations. As mentioned in an early article here on JWGP available here.

Whilst the venue’s approach to vehicle safety, through large tarmac covered run-off areas, perfectly lends itself to performance testing, minimising the risk of a driver being penalised for on-track errors and will likely lead to teams pushing the boundaries of track limits throughout the Grand Prix weekend. Coupled with this, the current philosophy surrounding Formula One aerodynamics have left many well informed observers to suggest overtaking will be somewhat of a challenge through the race:

With this in mind Formula One is at risk of a fourth successive event in which on track excitement looks set to be minimal. But worry not, there is a solution! As mentioned the Paul Ricard HTTT (High Tech Test Track) has a visionary trick up its sleeve, under the guidance of previous circuit owner Bernie Ecclestone and more recently his ex-wife Slavica, the circuit has an inbuilt sprinkler system.

The system is capable of simulating a multitude of wet weather scenarios at the touch of a button. Formula One returning to France and Paul Ricard offers owners Liberty Media the ability to bring to life the long-promised proposal from Mr Ecclestone to spice up Formula One through the use of sprinklers! (check out some of  his other proposals here)

Of course, with no announcement of such trial being made prior to the race weekend, Liberty Media will have to manufacture a scenario in which the magic sprinkler system can be activated by mistake thus creating global media coverage for an otherwise uninspiring event.  Winne Harlow, what are you up to this weekend? 😉

Formula One: Ferrari QUIT …Ordinary Smoking

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Scuderia Ferrari secured their second victory of the 2018 Formula One World Championship in Bahrain yesterday, with Sebastian Vettel managing to extend the life of the soft tyre compound well beyond the Pirelli advised operating window. The four-time champion converting a two-stop strategy focused on pure pace into a one-stop endurance challenge in response to what many saw to have been a checkmate move from Mercedes with Bottas and a recovering Hamilton pitting for medium compound tyres after Vettel’s first stop. This demonstration of masterful tyre management and dynamic race strategy suggests a thrilling season is in prospect.

After the processional opening race of the season, the eventful Bahrain Grand Prix was a welcome relief for fans and media alike. Overtaking is possible in 2018! Away from the racing, another feature of the 2018 season that continued to grab the attention of commentators was the smoking Scuderia Ferrari and the Ferrari powered customer teams. Technically minded reporters suggest this feature of the 2018 Ferrari power unit is the result of the power unit solution employed by Ferrari to overcome additional restrictions on oil being used as fuel. Through 2017 the oil generating this ‘smoke’  would have been channelled back into the power unit and possibly improved performance, for 2018 Ferrari have elected to channel oil out of the car. Much to the frustration of any competitor lapping behind them.

Whilst the technical explanation is entirely logical, (albeit poorly explained in this article) there is an alternative school of thought around this new feature of Scuderia Ferrari. Ahead of the 2018 season, it was widely expected the scarlet team would feature branding from title partner Philip Morris International’s electric cigarette / vaping division IQOS. In fact livery designer extraordinaire Sean Bull put together this fantastic mockup livery around such an announcement:

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Regional advertising restrictions around products containing tobacco likely put an end to these plans, but curiously around the same time as the 2018 launch, PMI announced an extension of its agreement with the Scuderia. Since 2008, when all tobacco advertising was banned in sports, PMI and Ferrari have sought to bypass these regulations through the use of suggestive images, such as barcodes mimicking the brand name Marlboro or team logos reflecting the Marlboro brand identity, is it possible the new smoking look to the 2018 Ferrari is a form of next level subliminal advertising?

IQOS stands for I Quit Ordinary Smoking. The IQOS device acts as a substitute for cigarettes, giving users the tobacco kick as cigarettes, with reduced health risks. During use, IQOS emits a harmless smoke cloud (seen here). Has Ferrari Team Principle and Former PMI Marketing Executive, Maurizio Arrivabene, created the ultimate subliminal advert for IQOS in developing a car to mimick the characteristics of the product a sponsor is seeking to promote?

Is it time to rename the Ferrari SF71-H  the SFIQOS-H!?!

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Photo credit: Mark Sutton

Formula One: “Grand Prix Driver” – The Conflicted Review

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I’m conflicted. Last week I was sent an advance copy of the Amazon Prime documentary series Grand Prix Driver. This fantastic series offers previously unimaginable of levels of access to the McLaren F1 team as they prepare for the 2017 Formula One Season. Recorded over a period of four and a half months, Manish Pandey, Chris Connell, and Anwar Nuseibeh have produced an in-depth study into the life of a Formula One team with seemingly no topic being off limits. All of which, for a lifelong F1 fan such as myself, sounds incredible. So why am I conflicted?

It is said you should never meet your heroes. After watching Grand Prix Driver, I think this phase should be modified to ‘never watch a documentary about your heroes. I want to make it clear, the production values of the documentary are second to none. To gain the level of trust required to film some of the scenes depicted through the episodes is a testament to the passion, dedication and commitment of Manish Pandey and the team surrounding him. This series is a must-see for any fan of motorsport. Unfortunately, however, it’s also a must-see for anyone studying business management looking for examples of how not to run a successful business, and perhaps most importantly, for Toro Rosso and Red Bull Racing on how not to work with a Power Unit Partner.

If you have seen a trailer for the documentary, it will be clear the series charts the breakdown of the relationship between McLaren and Honda on the eve of the 2017 season.

 

Analysing the series and reflecting on narrative documented, I have tried to break down my assessment of the team into a few key sections.

Partnerships

The key rationale for the McLaren Honda partnership was that Ron Dennis and/ or the team felt it would not be possible for McLaren to challenge for world championships as a customer team. Logic and recent history suggest this assessment is absolutely correct. The mantra throughout the McLaren Honda partnership and throughout this series is that of “One Team” and “We win as a team; we lose as a team”. The documentary shows those words to be largely empty. Relations between McLaren and Honda employees at every level of the business seemed strained at all times. There is a constant feeling of us and them.

An interesting insight into teams using customer power units in Formula One is when the customer receives the power unit. As a customer team, power units very rarely enter the team facility. One unit will be made available for the first time the car is fired up ahead of the season. After this, Power Units will be delivered to the circuit by the supplier and taken away again at the end of a test or race weekend. The benefit of direct / works relationship with a power unit manufacturer should be these limitations are removed. Team and Power unit manufacturer work as one in parallel. Based on the Grand Prix Driver documentary, this unity was never achieved between McLaren and Honda.

The first time McLaren physically saw the 2017 power unit was in the days preceding the first fire up of the unit. This is not an integrated partnership. Heading into 2017, Honda were playing catch up, they decided to overhaul their design philosophy. This decision, it is implied, was one McLaren did not have a say in. After taking such a decision, communication between McLaren and Honda should have been continuous, when it came to installing the power unit there should have been no surprises. As the documentary will show, this was not the case, with components having to be re-engineered on the fly.

The relationship between McLaren and Honda was not a partnership. It was barely more than a customer relationship, where the supplier happened to be supplying power units free of charge.

Humility

In speaking to Manish Pandey about the documentary, the topic of humility came up. Manish’s view of humility was interesting. His perspective was that both Honda and McLaren demonstrated great humility as they prepared for the documentary. He and his team made several attempts to get the team to discuss ambitions for the season. Looking for the soundbite of ‘returning to the top step’ or ‘challenging for the championship’. No one offered such remarks. Manish’s view was that this demonstrates the team were realistic in their approach to the season, and on this, I agree.

However, as the McLaren Honda relationship fell apart around them, it was the team’s complete lack of humility that struck me. Throughout the entire series, no McLaren representative takes any level of accountability for the partnership failing. Honda is made entirely responsible for the shortcomings of the team performance. This is wrong. We’ve all had relationships that haven’t worked out, at no time is one party solely responsible for a relationship failing. It comes across as hugely arrogant of McLaren to place all the blame for their performance through the Honda partnership at the foot of the power unit manufacturer.

Honestly, I am amazed McLaren are happy for this lack of humility to be made public. At times I wasn’t sure if I was watching a documentary series set in Woking or a Mockumentary series from Slough.

Communication

In the opening episodes, meetings are filmed from outside rooms giving the viewer a feel for events taking place without the content being made public, by the final episode cameras have been invited into meeting with no talking points edited or removed. Whilst again, this is great access, being part of these meetings will be quite distressing for any fan of the sport. Time after time the viewer is shown milestone dates on timelines being missed or management interactions in which it seems almost impossible to offer a clear answer to basic questions. To me this again comes down to accountability, no one in the organisation seems willing to accept their role in the failure.

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Sponsorship

The topic of sponsorship or partners is something frequently addressed through the series. In a bid to highlight a new beginning for the McLaren team, it was decided that a departure from silver, grey and black tones in the car livery and team environment was required. The origins of this decision and influencing factors are a little conflicted in the series, but the message for change was clear. The ambition being a new livery concept will entice new sponsors to join a new McLaren.

For me, the professionalism around this decision is diminished somewhat by branding being applied on the eve of the launch in what appears to be a corridor. Nevertheless, the ambition is clearly communicated. This desire to rebrand after a challenging period also explains why McLaren are expected to reveal another new livery concept for the 2018 season.

The McLaren team has developed a strong reputation within the technologies sector for its work outside of Formula One in recent years. Major FMCG’s consult with the group on numerous challenges. The McLaren Formula One Team depicted in this documentary is not one many FMCG’s would look favourably upon. I do not believe the McLaren commercial team will look favourably on the way in which the team is portrayed.

Even Handed Approach

In my discussion with Manish Pandey, in an interview for Paddock Magazine (click here to head to the interview) I raised the question of the way in which McLaren and Honda were depicted within the series, highlighting my concern that Honda did not have the opportunity to offer their side of the story.

Understandably Manish did not hold my opinion. The narrative of a documentary is often defined by the events it covers from the perspective of the lead. This is not a Honda documentary. It is a McLaren documentary and the views within it are communicated as such. Again this is not a criticism of the documentary, more a reflection of the brief and the client.

 

I sincerely hope my interpretation of the McLaren team based on the series is not an accurate reflection of the way in which the business operates. 12 months have passed since this documentary was filmed. With new management structures in place, much-needed process and accountability may have been successfully implemented. I, like many other F1 fans, hope to see McLaren back at the front of the grid challenging for race wins.  With The McLaren Team seen through this 2017 documentary, I doubt this would have been possible. Whatever the power unit.

Grand Prix Driver is available on Amazon Prime from February 10thClick here for more.

 

Formula One: Can F1 afford to wait until 2021?

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Barely a day goes by without one of the leading motorsport websites publishing comments around the future plans for F1. From louder engines to racing game inspired car designs, 2021 will amaze and inspire a new generation of fans. All of which sounds great, but it’s 2018. There are 3 seasons of Formula One between now and the promised fantastical future. The landscape of the motorsport industry can and will change dramatically in 3 years. Can Formula One really afford to wait?

2017 saw the introduction of the current set of technical regulations guiding the sport. Whilst cars are visually more impressive than there predecessors with the dimensions of the cars and tyres increasing. An overall increased emphasis on aerodynamics has had a dramatic impact on drivers ability to overtake with the 2017 season seeing less than half the number of overtakes of 2016.  At present, there appears to be no plan to address this issue, with the 2018 regulations seeing no modifications around aerodynamic regulations.

Mindful of a likely closer battle for wins, Mercedes, Ferrari and Red Bull Racing, may have focused the aerodynamic philosophies of their 2018 challengers around an ability to more closely follow a competitor, but without regulation changes a significant increase in overtaking from 2017 to 2018 is unlikely.

All this comes at a time the commercial positions of Formula One are coming under threat. Longstanding partners involved in the championship are defecting to the likes of Formula E or other sports, and at this time, prospects for new partnerships appear limited. With the Formula One business focusing their attentions towards 2021 why would a partner commit to the championship ahead of the ‘revolution’? The Formula One product from 2018 -2020 may be a difficult product to sell.

It is possible, Formula One management are focusing taking a strategy of focusing to the future with the view and expectation of teams demanding an earlier introduction of new regulations. With the Season 5 Formula E car set to make its public debut in the coming weeks, and Indycar looking strong with a new car concept, competition between championships is ever growing. Can Formula One and the teams committed to its success afford to wait another 3 years for change?

Formula E: Julias Bär confirmed as Title Partner for the Zürich ePrix

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Julius Bär – leading Swiss private banking group and Global Partner of the FIA Formula E Championship – has today been announced as the title sponsor for the historic first running of the Julius Bär Zürich E-Prix.

The electric street racing series will be bringing circuit racing back to Switzerland for the first time in over 60 years, with the inaugural Julius Bär Zürich E-Prix set to take place on June 10.

With its headquarters in Zürich, Julius Bär has been Formula E’s global partner since the inception of the championship in 2014. Julius Bär has been instrumental in bringing Formula E to the streets of Zürich for the very first time and have acquired the naming rights for the inaugural race.

Gian A. Rossi, Head Switzerland at Julius Bär, emphasises the Bank’s pioneering spirit and its commitment to future technologies as the main reason to support Formula E and the Zürich E-Prix: “Formula E is an investment in our society’s future. The racing series serves as a test bed for innovations advancing the future of mobility and ‘smart cities’. We firmly believe that in a country whose flair for innovation is the secret of its success, the racing series will generate great interest and underscore the image of Switzerland as a hotspot for technology. The decision to pick Zürich to stage the race is the right one – after all, it is a flagship for research and innovation as home to ETH, one of the two Swiss Federal Institutes of Technology, as well as being the country’s largest city.”

Racing had previously been forbidden in Switzerland for decades, with the last event taking place at Bremgarten circuit in 1954. However, a law change in 2015 lifted restrictions on fully-electric racing and paved the way for Formula E to bring electrifying wheel-to-wheel action to the streets of Zürich.

Alejandro Agag, Founder & CEO of Formula E, said: “It’s only fitting that at such an historic moment in the championship and for motorsport in general, one of the main protagonists in bringing racing back to Switzerland for the first time in over 60 years, has put its name to the first-ever Julius Baer Zürich E-Prix. Since even before the first race in 2014, our global partner has believed in the concept of electric street racing and has been instrumental in making the championship what it is today. Formula E makes history at every race, but on June 10, Formula E becomes the first category to bring back professional circuit racing to Switzerland – none of this would have been possible without Julius Baer and the vision of electric racing.”

Sebastien Buemi, Renault e.dams driver and proud Swiss, with his country’s flag emblazoned on his helmet, has stood on the top step of the podium 12 times before in Formula E, and will be looking to not only secure the Julius Bär pole position award, but put his name in the history books as the first professional circuit racer to win at home in over six decades.

“I cannot wait to be able to race on home soil – it’s something no other professional circuit racer has said in 63 years! The atmosphere of racing on the streets, coupled with having your home crowd cheering you on is something I’ve never experienced before and this will be one of my dreams achieved – I can’t thank everyone enough who has played their part in bringing racing back to Switzerland; from the city, the fans who have supported this, Julius Bär and Formula E,” the 2015/16 champion said.

Head to the Zürich ePrix website for all the latest on the event and to order your tickets, by clicking here

Formula One: Preparing for the budget cap

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The Liberty Media vision for the future of Formula One Teams is clear. The owners expect 12 commercially viable, profitable, franchises all capable of challenging for race victories. In his role as Managing Director of Motorsports, Ross Brawn, has been mandated with the task of delivering a strategy to ensure this vision is achieved.

12 commercially viable & profitable teams, on paper, sounds fantastic. With the variable of available finances removed, the resourceful nature of F1 teams will truly be put to the test. Outwardly it seems as though there is widespread support from the teams for such a move. Afterall, what business wants to spend more money? With representatives from leading teams including Red Bull Racing emploring Liberty Media to ‘ Save F1 Teams from themselves’ the route to implementing a budget cap should, in theory, be straightforward.

However, As with any commercial decision in Formula One nothing is straightforward. The first major hurdle to overcome is the existing structure around payments and the legacy of disparity. In 2017 Joe Saward explained the complexities around the current structure in this article. The existing structure rewards success and longevity, a something which is not overly inviting to a new team, nor geared towards a midfield team ever being in a position to surprise. In an estimated payment fund of $900M per season, the top 3 teams receive approximately 60% of the revenue, leaving the remaining, currently 7, teams to compete for 40% ($360M) between them. It is estimated that the smallest operational budget in F1 today is in the region of $100M, with only $50M coming from the championship, teams have a significant shortfall to cover.

A more appropriate payment structure would be equal distribution amongst all teams, with a proportional bonus for constructors championship position, similar to that seen in the Premier league as detailed here.  Unfortunately, in order to reach this point, the largest teams, with operational budgets believed to be in excess of $400M per season must agree to a cut in support from the system under which their team structure has been developed. What business would agree to lose as much as 50% of its funding without a clear view of how it will cut costs or increase revenue through other ventures.

Convincing; Red Bull Racing, Scuderia Ferrari, and Mercedes Grand Prix to agree to this change will be one of the key tasks ahead of Ross Brawn through 2018 and 2019 if a new system is to be introduced under the new commercial vision for the sport in 2020.

The task is far from simple, the infrastructure of the top teams has been built around a mindset of a limitless budget. If a budget cap of $150m per season were to be introduced in 2020 with no consultation from the teams, it would be almost impossible for the top teams to comply. From a personnel headcount perspective alone a team such a Mercedes Grand Prix, with in excess of 1400 employees, if an average salary of $50,000 is applied, the team commit 46% of its budget to salaries before considering building a car. Without modifying the current team structure, introducing a budget cap within the next 3 seasons, unless Liberty Media expect teams to make more than 50% of their workforce redundant, is not feasible.

On a more positive note, there are indications that the top teams in question are preparing for the change. A budget cap in Formula One will not mean that the likes of operating entity such as Mercedes Grand Prix or Red Bull Racing will be limited to an expenditure of $150M per season, rather their allocation of resources to F1 will see this limit applied.

As a result, it is highly likely that diversification will be a key element to the future of F1 Teams. Over the past decade, McLaren and Williams have established an industry-leading position in the application of engineering solutions developed to improve performance in motorsport being incorporated into manufacturing processes and commercial entities.  For these teams, this third-party business will likely continue to grow. it is, however,  unlikely Ferrari or Red Bull Racing will view this as an appropriate use of resources or brand credibility.

Instead, expect the very top teams to move towards expanding their foothold in other forms of motorsport.

  • Mercedes Grand Prix has already made steps in this direction with the announcement of a commitment to Formula E team from season 6 of the championship. This alongside the development of the Mercedes Project One, which to many is a clear indication of Mercedes ambitions to return to Endurance Racing. A return which with LMP1 regulations under review and the prospect of the reinvigoration of the FIA Global Engine strategy, Mercedes are well positioned to find success.

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Credit to Sean Bull Design for the concept Mercedes Formula E livery 

  • Similarly, Red Bull Racing through their partnership with Aston Martin has acknowledged an interest in taking the Valkyrie racing, and under guidance from Ross Brawn will no doubt be seeking to bring the Toro Rosso team entirely in-house.

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  • McLaren has taken the decision to take control of their GT programme, and have already explored further engagements in championships including Indycar following the positive coverage generated through the one-off partnership with Andretti Autosport at the Indy 500 in 2017.

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  • Ferrari continually talks of a return to Endurance Racing, and could, similar to Red Bull Racing consider a strategy of an in-house B-team with which budget cap compliance could be achieved.

In conclusion, political posturing between the top teams in Formula One, Ross Brawn, and Liberty Media throughout the 2018-19 seasons will likely overshadow on-track performances. Fans of the sport should take any empty threats from top teams to walk away from the sport as just that. Empty threats. The financial implications of such a move make the option unviable. Instead, teams will double down on motorsport, getting involved with more championships, with the eventual winner being the fans.

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