from crash.net this should be interesting Carol * * * * * * * * FIA President Max Mosley has finally conceded that he is 'willing to compromise' over the controversial budget cap row that is rocking Formula 1 and he is 'very optimistic and confident' that a solution will be agreed by the stated 2010 entry deadline tomorrow (Friday) that will avert an impending crisis. Following another meeting of the Formula One Teams' Association (FOTA) on Wednesday one publicly marked by the temporary suspension of Williams from the organisation, in response to the former multiple world championship-winning Grove-based concern having earlier this week become the first of the present incumbents to sign up to participation next year it is understood that a resolution is now all-but in place. Though current world championship leaders Brawn GP and traditional tail-enders Force India refused to back the expulsion of fellow independent outfit Williams and look set to similarly submit their entries on Friday regardless of the final outcome of the dispute, it is believed that thanks in large part to the stringent efforts of McLaren team principal Martin Whitmarsh and Mercedes-Benz Motorsport Vice-President a scenario has been reached that FOTA is confident will prove satisfactory to Mosley. The deal is centred upon a 100 million cap in 2010, dropping to Mosley's stipulated 45 million limit a year later, with further concessions for the competitors of whom Ferrari, Toyota, Renault and Red Bull have all threatened to walk away over the new regulations including one staff member per team, such as Red Bull Racing's highly-paid chief technical officer Adrian Newey, being excluded from the cap in much the same way as will be drivers and bosses. I am willing to compromise, Mosley told Italian newspaper La Gazzetta dello Sport, but only if small and new teams can operate with much lower budgets and are not much slower than the others. I am very optimistic about a solution. The big and small teams have very different interests, and we have to protect everyone. Will Ferrari enter by Friday? I think so. I am optimistic and confident. Ferrari is very important for Formula 1, but Formula 1 is very important for Ferrari as well.
Interesting if the teams really go for this. I was under the impression (rumor) that Mosley would have agreed to a final budget of $150+ mill USD after 3-4 years, not $65+ mill USD in two years as in this article. What is proposed in this article is a real surprise, and a bit too agressive. I can't imagine the teams gave in to the FIA like this. Of course, the concessions such as drivers, the single staff member, may actually bring the budget total to that $150 mill USD? The fine print. Curious to see that. If we get to see that. And it seems every article is different, is this in Pounds Sterling or in Euros??
The Formula One Teams' Association (FOTA) has agreed to propose a system of technical partnerships for new teams to assist them in joining the grid in 2010, following a meeting between the team principals in London yesterday, AUTOSPORT has learned. As the teams close in on an agreement with the FIA over the future regulations of F1 ahead of tomorrow's 2010 entry deadline, FOTA hopes this compromise would allow prospective new teams assistance from the established operations to compete credibly in their first seasons without having to fund a significant increase beyond the set budget cap. FOTA is pushing for a "glidepath" approach to adopting the budget cap regulations, with a two-step reduction in expenditure in 2010 and 2011. This would see expenditure limited to 100 million in 2010, dropping to 45 for the following season. The technical partnerships would give the new teams assistance in terms of parts, particularly non-performance differentiators, as well as some design know-how. The FOTA proposal is believed to stop short of allowing full-blown customer cars, something that is strongly opposed by several teams, and would be structured to ensure that the newcomers compete under the budget cap in their own right in 2011. FOTA also discussed further ways to develop the budget cap concept, with the possibility of some commonality of non-performance differentiators still on the table in a bid to repackage the imposed limit as a programme of cost containment. Although final agreement has not been reached, it is believed that both the FIA and FOTA are confident that a resolution can be found ahead of the entry deadline.
FOTA caved. Gotta be more to this, how do you go from $500 mill USD to $138 ($100 mill euros) mill USD in one year?? Ferrari and Toyota are in this stratosphere, they give up the most. But how? And the second year drops the "budget" to under $65 mill USD. I am shocked if FOTA agrees to this agressive change.
It sounds as if it is FOTA who are proposing these numbers, not the FIA. Presumably it's a done deal, I can't see the FIA turning down a compromise like this.
I agree with you completely, no question that it is supposedly FOTA's proposal. I am just surprised because rumors suggested that the FIA would comprimise even more so to the favor of the teams. Either the rumors were not accurate, or FOTA spent too much time on Flavio's yacht. There must be other concessions, as these numbers in a two year period seem too agressive. I have to believe the FIA will jump on this. Brawn and Force India will follow Williams and submit their entry by the May 29th deadline. McLaren and BMW are rumored to be preparing their applications. Which suggests that FOTA needs an agreement before it falls apart. Those sponsor contracts and their FIA contracts apply a lot of pressure to making a decision. I think by Friday, to save face, every team will submit their 2010 application. And we will see all the parties act as victors and one big happy family.
100 mil Euro cap that doesn't include engines, driver salaries or motorhomes doesn't seem overly restrictive.
Consider Ferrari and Toyota's current budgets. Subtract the items you listed, and you still have double, maybe triple of this propose budget. I have read that Ferrari is over $500 mill USD and Toyota around $700 mill USD. That would be a serious cut.
Don't get me wrong, as long as there is an agreement, and new teams find a way into the sport, this is all good. I am just surprised that FOTA would agree to a two year time frame, when I believe they could have had a bit longer.
I think we (well me at least ) may have been focusing on the FOM/FIA bargaining position and not been considering that FOTA was asking for things that they were willing to ditch during negotiations as well.
The only question I have is how would the FIA stop a team from setting up companies they don't technically control, but would supply parts/expertise/engineering/etc. at a greatly reduced or no cost?? It's not that hard; you fund the separate companies with corporate money...Example: Toyota money not Toyota F1 money (this a is very blatant example; there are many ways to hide control of another company). This way, the F1 budget is not being used and only the money that is paid to the other corporation by the F1 team would be counted under the cap. A lot of very large corporations hide debt in related companies; what is there to stop F1 teams from using them to hide costs? Mark
Difficult but not impossible to police. More to the point how can the playing field be leveled when exisiting teams have such an advantage when it comes to physical plant etc. ?
I understand. You have to step away, not look at the personalities or your own personal judgements, and see what cards each party to the party holds. Apparently FOTA agrees that the FIA can get involved in the operations of a team. Apparently FOTA agrees that budget cuts and budget caps are an agreeable solution. Apparently FOTA understands that the FIA was not willing to accept their letter of no rules changes. Apparently FOTA understands that new teams need to be brought to the sport. Apparently the FIA was not stuck to 2010 for instant final reduction. Apparently everybody knew that a break away series was near impossible. Apparently everyone knew that no one would really leave F1 over these issues. Apparently none of us knew exactly what each party was really willing to throw in to the negotiation pot. From this, the stongest hand in my opinion is not FOTA's. Assuming the points in the article that started this thread are true.
I remember reading that the FIA determines the cost of such activities, ie they are not solely looking at the money spent but also the details of services rendered.
Carol, Max's sudden change of heart is NOT going to change what FOTA'S main objective is in the least bit. It will maybe at best delay for a year or so the enevitable battle for CONTROL of F1 that is coming when Concorde is up. The manufactures have finally had all they can take of Max playing with the rules as he sees fit, and Bernie controlling everything as he sees fit, at their very considerable monetary expense. We may get a compromise on caps to keep the racing going, but it's only a stop gap measure for now. The teams may enter, but this only allows everybody to keep racing, this does'nt address Bernie's BIG problem that's looming. All of these games by Max and Bernie have been IMHO just a chirade to see how united FOTA is, and nothing more. If they stay the course, they will finally succeed, if not Bernie wins again, and the games will continue............Stay tuned Mike
Further note........... I wonder if LDM/Ferrari have forgotten yet that their really not needed in F1? I wonder if LDM/FOTA is going to take their collective feet off the gas now?.........I don't think so.
What we don't know is what revenue adjustments were made. Expenses are meaningful only if you know the other side of the equation.
Well, I´ve heard other figures, much smaller, around 200-300 mill $ for the big teams. I suppose nobody knows exactly how much they´re expending. Discounting engines, salaries, etc... it´s not such a big cut. McLaren is probably expending the same, if not more, and they´re willing to cooperate with Max, wich is quite surprising. It would be great if they allowed more technical freedom, to compensate the financial limitations, but I think it won´t happen.
