ACEA Statement

If you were the FIA, knowing that no other major car makers would be knocking on your door wanting to enter F1 because 95% of them are losing money, how would you react to this?

 

A professional response would be mandatory.

The FIA is not a professional organization. Look how they responded to Jackie Stewart? Look at how they responded to Martin Brundle?

They should heed the comments and implement an effective governance system that would make it attractive for these entities to enter F1. Furthermore, there is no reason F1 racing could not be a profit center. The new teams are a sham - if it was really only about costs, then some of the new entries would be companies like Porsche, Lambo, Peugeot, VW, Bugatti, or others. But it is a sham, so the new entrants are podunk teams who Bernie and Max probably called upon with a promise that they will turn a profit.

There is more than enough $$ in F1 to have teams make a profit, and in that case there would be no need at all to lure these new teams... they would be overflowing with entrants from large established companies.

It doesn't matter how much $$ Porsche is losing... if they could turn a profit from being F1, they would be there.

 

I agree, either a professional polite response or no response at all, should/would come from the FIA to the ACEA. My point being, at this point in time, the opinion of the ACEA is to use your term, irrelevant. They have no clout in this matter.

Michael, I can honestly say you are living in a dream world of the late 1990's. If being in F1 makes money, and irrespective of corporate economics, then Honda would not have left F1. And that will apply to the BOD of the other manufacturers that are considering a similar move for economic reasons. Its not so much that being in F1 is draggiing down these corporations, its just when you are at a stockholder's meeting, and dividends have gone down, these mostly non race fan stockholders and BOD members react by cutting out expenditures like motor sports. Its already happened with Honda. There exists only two teams that exist on racing, Ferrari and McLaren.

I don't care how much money can be made in F1, as long as the world economic situation is difficult, and companies like Porsche have gone from having the money to buy VW, Audi, and Bugatti, to reporting big losses, there is no corporate money to go F1 racing for the next 5 years. None.

Keep in mind, that FOM has helped make most of the current F1 principals very wealthy men. The reason there is so much money in F1 is because Ecclestone has made the sport a huge commercial venture. The teams get 47% of the TV revenue, with the new deal probably around 50%. Most of the rest belongs to CVC, Bernie would have less than 20%. So even with governance changes, where does this money you talk about come from?

And using Porsche as your example, from what you infer, it would be the logical assumption that Porsche would make money in F1, so why haven't they entered F1? You dwell on governance, its not just governance, its the cost of racing. VW(which is Bugatti) and Audi, are looking at supplying engines for the IRL. As is the Fiat company Alfa Romeo, likely using a Ferrari based engine. This interest came before the current politics in F1 became so public. The IRL is much cheaper and more publiclity for the dollar, not to mention past their political issues.

At any rate, even if Mosley was gone, you will not see large corporate entities enter teams in F1 for a long time.

 

Not sure that's the point Ron.
Opposition to the FIA is spreading to a larger community. The auto makers relationship with the FIA encompasses a lot more than F1.
Looks like being associated with the FIA is becoming an embarasment.

 

Bingo! It's not the stark reality of the world financial crisis that is the problem here. It's how the reputation of F1 is apparently being damaged by the current heads.

 

In our somewhat insular world we think the FIA is only about F!. They have other important constituencies that have allowed them to exercise their sporting arm with a great deal of leeway until now.

 

It seems that anyone who ever disagrees with you, doesn't get it. So, you're never wrong, other people are just clueless. LOL! Ron you are the Chuck Norris of the F1 section

My point regarding costs was that with appropriate governance, there could be a business case made, along with reduced costs, that would make F1 attractive to new entrants.

Do you think Campos just decided to spend $50mm to be in F1? USF1? No, I don't think so. I think these teams are looking at the expenses and the revenues and trying to figure out a way to either make money being in F1, or at least not lose money.

If it was about money, and not spending too much of it to be in F1, then you'd see more manufacturers moving to F1. Manufacturers have an additional element that independent teams do not have - that is exposure and brand awareness (i.e. advertising) that F1 does for them. Campos, iSport, Superfund and others do not. For the rats, it is ONLY about the bottom line.

The reason you are not seeing Porsche, VW, Audi, Bugatti, Pegeuot or any of those companies showing interest in F1 is because of the *governance*. They aren't going to jump into that frying pan - no way. If the rules were stable and they could make a 5 year commitment and *know* what they were getting into, they could make a business case for it.

But they can't, because who knows what tomorrow will bring... maybe it will be new engines, or they may get fined a hundred million, or their earned results may be voided at the whim of Max... because the sport has utterly inadequate *governance*.

It's all about governance. Not money. Governance.

Dave's point is very correct - larger forces are piling on to the anti-FIA (aka the "need appropriate governance") bandwagon.

Max is screwed.

 

This is true, however besides F1 and WRC, they don't have as much as people think. If F1 left the FIA (well, I mean if a new series became the de-facto F1 and was under a different governing authority), it would be a massive blow for the FIA. Other than F1, most big racing series aren't governed by the FIA.

They have to be very careful wielding their stick... it's getting shorter and shorter every time someone else piles on

 

Maybe the FIA should get out of the racing business entirely.

 

At the end of the day respecting the FIA's rules and govenrance is voluntary... what are they going to do invade a country that disputes the FIA? I just say everybody ignore the FIA for a couple of years and they will die on the vine. Bernie will have so many law suits going on... they will just bleed all their cash. tie them up with attorneys for years... that's the way to get at Bernie & max....

 

Lifted from Autosport:

Seem to me that Mad Max really is getting desperate..... As for Porsche, why not let them issue their own statement?......

Cheers,
Ian

 

At the very least he thought it important enough to acknowledge. But he still doesn't get it, does he?

 

I thought this was interesting from the FIA response to the ACEA, suggests to me that the FIA would settle for ultimate budget caps of around $100 mill USD (see the one third of this figure comment below at the very end) or $260 million USD (see the first sentence below mentioning the $200 mill Euros) depending on how you interpret this:

"The potential savings are not immaterial: reducing the costs of the five manufacturers from the €400 million to €500 million recently reported by Ferrari to even a level of €200 million would release €1 billion to €1.5 billion a year back into the core businesses. Although a team like Ferrari could still spend as much as €200 million despite the FIA's cost reduction programme, others will be able to compete successfully for as little as one third of this figure."

 

I disagree with you 50%, and if you go back and look at your own posts, it is you that favors the wording "doesn't get it" when you respond to me and others. And I don't use the word clueless, I think that belongs to somebody else. But please show me where in these current discussions I initiated, not as a response to you, using these words of which you accuse me.

The FIA is involved in governance of other motor sports where Peugeot is involved, also Porsche, and Audi. So these manufacturers do not appear to have serious trouble with FIA governance to keep them out of racing. That is not the reason you do not see major corporations lining up to enter F1.

No other form of motorsports has two car teams that spend $500-$700 Euros annually and still don't win. How do you expect any new team to enter the sport, make money and win championships if they consider that financial challenge? There is no question that Mosley overstepped his authority as FIA chief. But he is still in place, we don't know what is thought of him internally in the FIA, and the current negotiations must sidestep the personality issues and proceed to a compromise. I fear that the Mosley/diMontezemelo friction may have already affected the negotiations, possibly that is why Ross Brawn is meeting with the FIA today.

My disagreement with you of 50% means I think you are incorrect that this is only about governance. It's not. I would agree that stability is needed if F1 governance, but the other part of this equation from the FIA and most certainly FOM's perspective remains as monetary. Reducing the costs of F1 so new teams can enter the sport. To think all that matters to current or future participants in F1 is governance is allowing yourself to remain in the personality pit. Mosley this and Mosley that. Mosley will have his wings clipped soon, but the monetary issue will continue to prevail as most important for the long term in F1. I look at this from all angles, and I see FOTA wanting rules stability (governance as you call it), and FOM/FIA wanting budget restrictions for obvious reasons. I also see that there are teams within FOTA that want budget restrictions (BMW, Brawn), and I also hear that it has been revealed within FOTA that there are two teams that may not return for economice reasons (Renault, Toyota). From this, there is no way anyone will convince me that from all perspectives this negotiation is only about governance. The ultimate compromise will include budget restrictions, and method to prevent arbritrary implementation of rules by the FIA chief. The latter will lead to Mosley's retirement.

With budget restricitions, and Mosley either retiring or having limited power, then you might see some major names coming to F1. The latter alone will not bring in new teams.

Also consider what the other teams truly think but may not have stated publically as did Frank Williams about Ferrari's special deal with the FIA. How will this biting tidbit affect how the teams ultimately agree with the FIA? Maybe nothing, but I personally, I don't think so.

Michael, I would love to also live in that dream world of the 1990's that you propose where large manufacturers entered racing. I don''t see that happening any more, unless there are budget restrictions that make it enticing to become a winner without spending unlimited amounts of money.

The FIA/FOM/FOTA party going on right now is about money and power, not simply governance.

 

Ron, I think the point is ultimately going to be the removal of Max Mosely.....period. All sides have agreed that cost reduction is necessary. ACEA's statements refer to the governing of F1, as do FOTA's. The FIA choose to respond by sticking their head in the sand with a response that only addresses money. Until the issue of Max is dealt with to the satisfaction of FOTA, ie. Max's removal, or them having a much stronger say in the process of governance there is not going to be a resolution within F1...... IMHO

 

One other note: Does the hand of LDM look like it had anything to do with the ACEA statement? I said in another post some time back that Bernie was playing with the ultimate politician in LDM and he and Max should pay close attention, very close attention. If the political winds start blowing hard enough the FIA itself could find itself irrelevant..........

 

Exactly!

IMO...
In every statement by FOTA all they repeatedly talk about is "governance". The monetary issue is taken care of. FOTA's stand is clear and has been consistant. The FIA is the one going around in circles about the money issue (which is basically resolved) and pretending the main issue about governance just doesn't exist. However, I can understand why the FIA doesn't want to even acknowledge governance issue because they know what will ultimately have to happen.

 

Preeeeeeeeee cisely.