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F1 cost cap backed by Mercedes

March 28, 2019

Formula 1‘s future is currently in the balance with talks being held in London this week between all the major stakeholders to determine what the sport should and will look like in years to come, one sticking point could be the contentious issue of a budget cap.

There is little doubt that if all ten teams were spending the same amount of money it would close up the field and give the teams at the back a better chance of competing for podiums and wins.

But why would Mercedes, Red Bull and Ferrari want that? They have the money to spend, so why shouldn’t they be allowed to spend it in pursuit of championships?

Well, seeing it solely from their point of view it’s difficult to argue with them.

However, if we’re looking at it holistically, three teams with almost infinite budgets ($400m) and seven teams that are unable to compete with them because they don’t have the money to invest in staffing, resources or development (as little as $100m, reportedly) and you end up with a pretty one-sided championship where three of six drivers will end up on the podium in every one of the 21 Grand Prix in a season, a la 2018.

The problem F1 has is that it needs to keep the big teams happy whilst making sure the smaller teams don’t go bust. Any one of the ten teams leaving F1 in the current climate would be a complete disaster for everyone involved.

And the red lines of the big teams are completely different to those of the smaller teams and so it’s not an easy task.

A budget cap has been proposed as recently as 2010, when, encouraged by a more realistic financial burden of a season in F1, three new teams entered – Virgin, Lotus and HRT.

Unfortunately for them, pressure from the big teams told, the budget cap was scrapped and all three teams went to the wall in short order.

It has been suggested that the proposed budget cap will be somewhere in the region of $150m a year from 2021, with an extra concession given to any team that also supplies engines.

As you’d expect, teams like Williams and Racing Point are fully behind this planned cap, and Ferrari and Red Bull are slightly less keen.

But Mercedes, apparently the biggest spenders in 2018, have made positive noises about the proposed capping of budgets, with reporting that Toto Wolff said:

“Mercedes is certainly interested in having a cost cap implemented at the right levels so that it makes sense for everybody. [We must] get the big teams on board in a way that is implementable and cap us to make sure we are not running away with it with higher costs each year.”

A cynic might argue that wily old Toto is saying that knowing it’s impossible to get unanimous agreement from each of the teams for such a cap and so he can make such magnanimous comments without ever being held to account.

Liberty now have the job of persuading three big fat proverbial turkeys (no offence to anyone in Stuttgart, Milton Keynes and Maranello) to vote for Christmas.

I’m glad it’s not me.


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