FIA/FOTA UPDATE: June 10 Ferrari's Position

Ferrari team principal Stefano Domenicali insists the FIA cannot include his outfit on the entry list for 2010 when it is published on Friday, unless the governing body has agreed to demands laid down by the Formula One Teams' Association (FOTA).

With less than 48 hours to go until motor racing's governing body publishes the list of teams entered for the 2010 championship, there has been mounting speculation that Ferrari could controversially be part of the gang that is deemed to have an automatic entry.

This is because the team had made commitments with the FIA and Formula One Management several years ago about guaranteeing its presence in F1, in return for favourable commercial terms and a veto on technical regulations.

Domenicali joined a FOTA meeting in London on Wednesday to discuss the matter, as the teams' body prepared itself for Friday's announcement. Afterwards, Ferrari issued a statement saying that it could only be part of the entry list if the conditions it laid down on May 29 were met.

"Ferrari's position has not changed," Domenicali said. "Back on 29 May, we put in a conditional entry with the other teams that make up FOTA. Along with this entry, we put forward to the FIA a package of proposals which included among other elements, a significant reduction in costs.

"As always, we will do all we can to find a solution that is acceptable to all parties. If this is not possible, then the FIA will not be able to include Ferrari in the list of teams entered for the 2010 FIA Formula 1 World Championship."

The agreement at the centre of the latest argument was deemed valid by a French court last month, when Ferrari sought an injunction over the 2010 regulations being introduced. The courts ruled that only the time frame for sorting the matter out prevented Ferrari being given the opportunity to overturn the 2010 rules.

However, Ferrari insists now that the terms of the contract it had in place are no longer valid.

Speaking in an FIA press conference in Turkey last weekend, Domenicali said: "We had an agreement with the FIA but we felt that the obligations inside that agreement were breached, so the agreement is not valid anymore."

 

Domenicali stated:

Speaking in an FIA press conference in Turkey last weekend, Domenicali said: "We had an agreement with the FIA but we felt that the obligations inside that agreement were breached, so the agreement is not valid anymore."


This is key, I would like to know what obligations Ferrari feels were breached. If legally they are correct, they hold the better hand and can control the discussions.

 

Michael, as I read the results, the French court did not negate Ferrari's veto rights, they merely stated they did not veto in the time frame allowed, they were too late. Also, in a statement in the last few days by the FIA, they stated that in their opinion the Ferrari contract is in effect, and that includes the veto rights.

So far, nothing has been stated or published to the contrary. So my question still stands, assuming all of this is true, what else in Ferrari's opinion could have been breached? Another question, what exactly is the wording of Ferrari's veto rights?


Nice try, but at this point it is still 0:0, nobody is winning.

From an AP wire:

The French court, however, refused to grant the injunction to Ferrari with Judge Jacques Gondran de Robert ruling that Ferrari had failed to use a veto against the new rules at meetings of FIA World Motor Sport Council in March and April when the matter was discussed.

Ferrari did vote against the new rules at these meetings but did not go as far as issuing a veto which was its right. The judge accepted Ferrari's legal right to challenge the plans but agreed with the FIA that the team should have taken its case earlier to the World Motor Sport Council.

 

Yes and no. AS I understand it, the veto is functional as long as Ferrari commits to the 2010 season without conditions.

This has been my point in other threads. None of us know the exact wording of the veto, but if Ferrari commits to 2010 as suggested by Mosley, would they not be able to use that veto concerning certain uncomfortable rules? Thus making the unconditional signing of the FOTA teams less of a problem. The issue is, can the other teams trust Ferrari to do what is good for everybody, and not just Ferrari?

The actual wording of this veto power determines its strength.

 

The court refused an injunction because Ferrari did not attempt to use its veto in a timely manner, we can only assume that the veto power has a time frame attached.

If I remember correctly, the FIA did just this, told the teams to go for a break away series, and they even volunteered to help run it if FOTA wanted.
Yes of course, the FIA series without Ferrari would be devalued, but then we virtually don't have Ferrari this year anyway. The same happened with the IRL and CART. At one time, CART had all the name drivers, but the IRL controlled the significant events. Since sponsors call the shots anyway, even if these teams were to leave, form their own series which is extremely doubtful, give it 2-3 years, and they will be back. Like Damon Hill said, its IRL/CART all over again.

I still believe it is obvious that FOM/FIA have the upper hand at this point. Nothing has become public that disputes this.

 

Michael the court did what you said above, but in its decision also stated that it agreed with the FIA that Ferrari has the veto power but did not use it on a timely basis. That was the crux of the FIA's arguement to the court, Ferraris' timing. The FIA had to agree that the veto power existed, which they did, but the fact that Ferrari voted against new rules but did not use their veto power back in March worked against Ferrari.

I suggest you think it through also. F1 will continue in some form even without the majority of the FOTA teams. It has to, no choice on the part of FOM. Its an ongoing big business, you seem to think it will just fold and go away, very very unlikely. No more than CART or the IRL folded after their split, FOM will continue, of that I have no doubt. Legal action against the FOTA teams will likely kill even that slight chance of a breakaway series. Brawn, Williams, Force India, and I will even say BMW (they want budget caps and they liked KERS), will stay with the FIA. Possibly Mercedes, not with McLaren, but with Brawn. So the only world championship will be the one that FIA/FOM control. If Ferrari leaves, by the end of the summer, they will return. Certainly the revenue to Bernie will be much much less, but somehow, as always, he will renegotiate and continue to survive. You continue to underestimate Bernie Ecclestone.

I don't at all see it as a do or die for FOM/FIA. But I do clearly see it as a do or not do for FOTA. You suggest that most of the FOTA teams can continue to exist even without F1, certainly that applies to Ferrari, Toyota, BMW, Renault, and Red Bull, they have other core businesses. But McLaren's consulting business would not pay for the massive F1 payroll. The same goes for the remaining teams, without F1, they might as well shut down. And they will. There is no other series that can give these team's sponsors the visibility of F1. The one shot annual LeMans just does not cut it.

And do you think that the Ferrari facatory, or Fiat will just suddenly absorb the F1 budget? No way! BI will suggest that budgets for 2010 factory operations for 2010 have no room for another $300 million expenditure. Massive layoffs. This includes Toyota. You suggest that these teams can just sit around or jump to another series as if it were easy. Its not, it is near impossible. FOTA has stated this, using words only a hair away from impossible. You should know better, that is why I will not say you obviously have no idea of the difficulty of simply changing course from F1 to another business. And Max and Bernie know this. You are being blind and unrealistic. I wish you were correct, but I do not see any use for denial. One thing for sure, with the exception of Ferrari, none of these teams will cough up the money necessary UP FRONT to bput on another series. Toyota, Mercedes, Renault will just shut down F1 operations if they do not continue with the FIA. Remember, the BOD of these companies are single votes away from dropping F1 even now. You think they will say no problem to the gamble of a breakaway series, or no activity at all?

And you forget the team's contractual responsibilities. Let's assume the sponsors forgive these F1 teams, and let's assume they don't ask for any money back. Just how long will these teams continue payroll, and other non-direct racing expenses before the lack of sponsor money cause the whole thing to come to an end. Sponsor money is what pays for the daily operations, all of these teams are in this for a profit. Even in good times, they don't always make a profit, but without sponsor money they are the ones that are screwed, not FOM or the FIA.

But let's assume the sponsors say they will stick around for the new series. You know as well as I do, it will take at least a year if not two before the series proves itself to potential TV broadcasters adn sponsors. Face it, being the name teams may get you in the door, but they will need to prove they will not be another CART on opening day. And I doubt if current team sponsors would coninue on the same level.

You get the point, financially, these teams may continue their core business, but their F1 business will be dead. And if they have no core business, the team is dead. The teams know this, so sooner or later if not this Friday, they will join the FIA F1 series.

I don't care what happens to Mosley after October. If he decides he wants to continue, there is that possibility that those that elect him will understand and/or agree that in this game of politics, he did what he had to do, otherwise the FIA would be weakened if it allowed the teams to dictate policy. Then there is the possibility that they will take your view, that Mosley killed the sport, and Mosley is gone. I have no idea. I hope he just retires and goes away even if he wins at this negotiation. New blood is needed in the FIA. Four terms are too much. Although, I will predict that whomever is his replacement will ultimately be no different.

I stick with what I have been saying all along, and so far, actions by all the involved parties indicate I am warmer than you are. FOTA is backed into a corner. They have no place to go, except with the FIA.

In this one situation Michael, I hope at the end it is you that is correct. Actually, I don't care which one of us is correct, as long as there is a viable F1 series next year with all the teams and a couple of new ones.

 

http://www.ferrarichat.com/forum/showthread.php?t=246536

 

Of those that attend races, what percentage do you think are actual fans? I figure maybe 25%, those that read all the latest news articles, buy Autosport, F1 Magazine, etc. The other 75% are there for the show off of the track and the t-shirts. Of that 75%, most are watchers, but then I would add the category of "followers". Those that really know who sits behind the wheel of each car, maybe even the points standings, but if some between race tidbit doesn't appear in their daily newspaprer, or on TV, they don't hear about it until the next race.

As for TV viewers, I would think its 50% watchers, 25% followers, and 25% true fans.

So the majority of F1 watchers/followers really do not understand no care about the current politics.

David, what do you think?