The F1 Politics game ...

There are reports today that Bernie Ecclestone is blaming KERS for the fire in the Williams garage in Barcelona. It is probably wiser for all concerned if we wait to hear the conclusions of the inquiry in Spain into what happened. Williams suspects that it was more to do with static electricity and fuel vapour.

However, I suspect the real reason for this story is that Ecclestone wants to stir up trouble for the FIA. By using his pet website to stir up trouble about KERS, and knowing that the cut-and-paste brigade will soon be churning out articles saying that KERS is dangerous, Mr E will raise questions about the new hybrid technology that is central to the future formula being planned by the FIA for the 2014 season. He is clearly against it and has been from the start and has the support of some of the teams because they think it will be expensive or it will make them less competitive against their opposition.

The FIA has already agreed to push back the new rules for a year and it is hard to imagine that it will agree to any further delays. The thought process behind the new technology (which actually dates from thinking in the previous FIA regime) is that it will not only ensure that the sport maintains an good image in terms of green matters, but also that it will have more direct relevance to the automobile industry, which is hot to trot on all things hybrid at the moment, which means that there is an opportunity for new manufacturers to join the fight. Obviously, a relative small car company such as Ferrari is perturbed by this idea, even though it could use KERS to great effect on its supercars to make them rather less open to environmentalist criticism.

Sticking with the current engines is an option that would suit a lot of people, but the FIA feels that it is not the best way forward and as it owns the sport and controls the rules, it has every right to do what it is doing, if it goes through the right processes. If it gets the formula wrong then there will not be sufficient entries and there will need to be a rethink, but the reality is that it looks like a change of engine rules will not really affect the size of the grids. An as with all new technologies the cost involved will reduce dramatically once the initial research and development is done. In any case, this is research that the car companies want to do, so they are not the ones complaining.

One might easily suppose, therefore, that this is part of a much bigger conflict in which the FIA and the Formula One group are negotiating over money. The Federation needs to agree to the Concorde Agreement, which it may not wish to do. There is also a veto clause in the contract between the FIA and the Formula One group that might be actioned if the FIA considers the flotation to constitute a change of control. This is assuming that a float happens, but even so a the sale of shares thus far would seem to suggest that CVC Capital Partners needs to explain how it remains in control when it appears to have less than 50 percent of the shares in the business.

The Concorde Agreement deal can probably be solved with money because the FIA’s primary beef is simply that it was not given a fair deal when the 100-year lease was agreed back in 2000. There is no doubting that the federation did agree to the numbers at the time, but that was for different reasons and looking back now, the arrangement was a very poor one in financial terms.

In the old days, Ecclestone had less trouble with the FIA as his long time mate Max Mosley was in control and they worked in cahoots on many occasions to get the teams to do as they were told. These days it is not so easy. Todt is not Mosley and that means that getting the FIA to budge is not as easy as once it was. However, when push comes to shove, the right amount of cash to enable the FIA to pay for its campaigns and other expenses is the best solution for all concerned. If the fight escalates things could get much messier, not least because the fIA as the right to determine a budget cap if it chose to do such a thing.

This would mean that all the teams would HAVE to spend the same amount (or less) no matter how much money the Formula One group gave them. That in turn would weaken the position of the Formula One group because it has always succeeded in breaking up the teams using money as the lever. If the teams are thus united they will inevitably realise that they can cut better deals with the Rights Holder if they work together than if they slit one another’s throats… As this would not affect their competitiveness, but only their bottom line.

From Saward Blog, interesting stuff.

 

Oh the good old days..

A Big battle looming maybe...

Am glad to say Todt won't roll over with Bernie, but I have conflicting interests on which side I take.