- 33,155
- Hammerhead Garage
It's easy to write this off as Mosley trying to justify his presidency, but I think it's more than hot air. I won't deny that, at the very best, Mosley did as much harm to the sport as he did good (and that's being generous). But there's stuff in here that makes me think twice - there was a lot of stuff going on that we never saw, and Mosley's article confirms a lot of things that were never really talked about: Ferrari pressuing the FIA to nail McLaren without evidence, and the way the FOTA walkout was a manufacturer initiative and the sudden silence that came from FOTA even after though they were loser than ever to a breakthrough in the negotiations. I'm not prepared to write this off as fluff or as a lot of hot air or Mosley's propaganda; I think there may actually be something in there. I don't think it redeems Mosley, but rather it's a case of FOTA being just as self-serving and stubborn as he can be.Max Mosley: the inside story on McLaren's 'spygate' and the F1 teams breakaway
On July 3, 2007 I got a call from Ron Dennis, the boss of the McLaren Formula One team, to say that at 7.30 that morning, lawyers acting for Ferrari had raided the home of Mike Coughlan, McLaren's chief designer, and recovered CDs which were believed to contain the entire technical details of the current Ferrari Formula One car. "Spygate" had begun.
Ron assured me that this had come as a complete surprise and he was instituting an immediate internal inquiry to see if anyone else at McLaren was involved. A little later I got a call from Jean Todt with the extraordinary tale of the tip-off to Ferrari from a fan whose employer had been asked by Mike Coughlan's wife to copy the information.
Despite Ron's inquiry, which, he said, established that Coughlan was the only one involved, we invited McLaren to the World Motor Sport Council. Although no one on the council believed them, we had to acquit. Concrete evidence of use by McLaren of the Ferrari information was simply not there. Without it, McLaren would have won an appeal to the FIA International Court of Appeal (ICA).
Ferrari were understandably furious. I even had a lengthy call from Fiat chief executive Sergio Marchionne, who is someone to be taken seriously. All I could do was say that without evidence, we could not convict, however much we might believe them to be guilty.
However, during August, emails emerged which showed others inside McLaren were indeed aware of the Ferrari information. Back in front of the WMSC for a second time McLaren could not escape. They were clearly guilty.
The problem was what to do. Armed secretly with the entire intellectual property of their main rivals, not to mention a flow of additional information from Nigel Stepney, their 'mole'" inside Ferrari, McLaren had clearly enjoyed a massive but wholly illegitimate advantage. This called for a sporting penalty. The most appropriate one was to exclude them from the championship. But there was also 2008 to consider. They had had this information in the crucial April to July period during which the following year's car takes shape. They would have had the benefit of the combined knowledge of McLaren and Ferrari in developing their 2008 car.
The only safe thing would have been to exclude them from 2007 immediately and also from the 2008 championship. But with little or no income for 18 months and over 1,000 employees, their situation would have been dire. A ban would also have destroyed the great championship battle which was going on between Lewis Hamilton and Kimi Raikkonen.
I was for a ban. I understood the consequences but I believe in the old legal maxim "hard cases make bad law". But I was outvoted (so much for the accusations of dictatorship) and the council went for a very large ($100 million) fine instead. McLaren did not appeal. No doubt they realised that the ICA would almost certainly substitute a ban for the fine. They also knew no civil court was likely to interfere with a ban in such circumstances and the requirement to make full disclosure under oath during the legal process of discovery might lead to much greater embarrassment.
Despite the large sum involved, McLaren knew they had got off lightly, particularly after checks on the 2008 car revealed further devastating evidence. One email exchange between engineers responsible for the 2007 and 2008 cars asked whether information had come "from our mole" at Ferrari.
Unfortunately a few superficially plausible pundits seized on the size of the fine without a moment's thought about the alternative. They did not ask themselves why there was no appeal either to the FIA ICA or to a civil court. They spoke of a "witch hunt". Some even tried to suggest McLaren were not guilty, although this stopped when the mole email finally became known in December 2007 and McLaren decided to confess and apologise.
But for me, personally, "spygate" and its consequences marked a new era. The view that I was too aggressive, too confrontational and perhaps even a bully was peddled non-stop. I was blamed (wrongly as it happens) for the size of the fine. So when Formula One confronted a real problem just over a year later I was less well placed to deal with it. And my situation was worsened by revelations about my private life, notwithstanding a big vote of confidence by the FIA and successful litigation against the newspaper responsible.
Following the failure of the teams to agree cost-cutting measures in the autumn of 2002, we used the parc fermé rules in January 2003 to eliminate qualifying cars, qualifying engines and stop the use of three engines per weekend. This was the start of our campaign against excessive spending. It met with considerable success, particularly for engines.
Despite this, the manufacturer teams were still spending $400-500 million each year. This was clearly unsustainable, given that a contest which would be indistinguishable when watched on TV or from the grandstands could be organised with greater technical freedom for between 10 per cent and 20 per cent of those budgets.
In January of 2008, I called a meeting of all the teams, together with Bernie Ecclestone, in Paris. I raised my concern that with six manufacturers in Formula One the sport was particularly vulnerable to any change in their fortunes. This was at a time when the car industry was riding high off the back of record sales and profits in 2007. The collapse of Lehman Brothers and the world financial crisis lay in the future.
I pointed out that the level of costs was unsustainable even for those companies and that, with other pressures like new European Union emissions limits, their resources would be pulled away from Formula One. I said: "A third factor was the possibility of a worldwide recession that would have an effect on the motoring industry." The meeting agreed that action was required and we initiated a study into the introduction of a budget cap for Formula One.
These measures were ready to be passed into regulation by the summer of 2008. Only one or two teams objected and, in normal circumstances, we would have been able to carry through what were clearly essential measures. However, at that crucial time, I was temporarily weakened by the events of the preceding months.
No action was taken and the problem became acute when, in the autumn of 2008, the financial world went into meltdown. The shares of the major manufacturers fell precipitately. In December Honda pulled out of Formula One without notice, despite their team's firm entry in the 2009 championship. It was not likely that they would be the only ones to react in this way. We could not afford to delay action any further.
During the summer the teams had created the Formula One Teams Association. FOTA wanted to take charge of the sport. We held a meeting with all the Formula One teams in Monaco on Dec 12 2008. It was successful. They too agreed that costs had to come down. They had a number of proposals which were fine but, in my personal view, restricted technical freedom too much, but we were prepared to accept their ideas. I felt we also needed a concrete figure and a foolproof method to check that no one was spending too much, but things were advancing.
But as the weeks went by, there was no progress. I asked for meetings to discuss cost reduction. The teams refused to meet and made it clear they wanted to do all this internally without the FIA. I felt this was too uncertain. Apart from one private meeting with Ferrari (and FOTA) chairman Luca di Montezemolo in February, there was no dialogue. However at that meeting, in response to my concern that we would lose more manufacturers because of the financial crisis and find ourselves with too few cars on the grid, he promised letters from the chief executives of the main companies guaranteeing their teams' participation in the championship.
It soon became clear that Luca could not deliver on his promise. But without guarantees of participation, Formula One was in serious danger. With no new teams and a very real likelihood that more of the manufacturers would follow Honda's example, we could be left with 14 cars or fewer.
Unable to have a meeting with the teams or find any sort of agreement with them about what to do, the FIA had a choice. We could do nothing and just hope for the best. Or we could publish some rules to attract new teams so that if the worst happened and we did indeed lose some of the current teams, we would still have enough cars for a credible championship.
It seemed to me obvious that we should consult individually every team who were willing to talk to us but then draw up rules which would reduce costs to a level at which a new team could enter but a big team could still continue to compete effectively.
This process of consultation led to the gradual evolution of the rules which started at £30 million all-in, and ended up, after much discussion, at £40 million excluding the cost of drivers, engines and promotion. This meant a big-spending team like Ferrari or Toyota could continue at $200 million or more in total, but nevertheless benefit from a reduction of about 50 per cent. However, a genuine independent team could be competitive on a much smaller budget.
We knew that some of the top-spending teams would probably not agree. They did not want a Formula One with very free technology but strictly limited expenditure. They were used to throwing money at problems and competing on an equal basis with just two or three other big-budget teams.
Doing nothing and hoping for the best is seldom the best way to meet imminent danger. I was kicking myself: we had probably been one of the few sports or businesses that had foreseen the problems of 2008 and taken steps to prepare ourselves but (for all the wrong reasons) we had not finished the job. Now we had to finish it. We knew that if we delayed, it would be too late for any new team to build a car for 2010. So we published the principles of our new rules mid-March. Then, in the continuing absence of any dialogue with FOTA and after discussing the matter in two WMSC meetings, we published detailed rules on April 29.
FOTA told the world this was "dictatorship". It was cited as an example of my "autocratic" style. No doubt they would have preferred us to do nothing so that they remained in a powerful position as the only teams in Formula One. But from an FIA point of view, given our duty to maintain a full grid and the refusal of the FOTA teams to discuss rules for cost reduction and their inability to provide guarantees of participation, it is difficult to see what else we could have done.
Publishing the rules and allowing the minimum 20-day period under the International Sporting Code before the opening of entries at last brought FOTA to the negotiating table. We met the FOTA teams at Heathrow on May 15 but it was clear they had come not to negotiate or discuss but simply to dictate to us their terms.
When we raised the question of the cost cap (fundamental to our plans and the reason we had applications from new teams for the first time in many years) a Toyota employee tried to lead a walkout while Ferrari added to the hostile atmosphere by launching legal proceedings against the FIA during the meeting.
Ferrari's legal proceedings failed and we had another meeting in Monaco on May 22. This time FOTA were prepared to talk. They asked for three things: clear rules of governance, stable regulations and a more gradual reduction in costs. We offered to re-introduce the governance and stability provisions of the 1998 Concorde Agreement to cover the first two points and to look at their ideas on cost reduction for the third point.
When the deadline for entries was reached on May 29, the eight FOTA teams submitted conditional entries, which not only rejected outright the published 2010 rules, but also excluded the International Sporting Code (ISC). The FIA then had until June 12 to accept or reject entries.
On June 11, we had yet another meeting with FOTA. This time we agreed everything except the mechanism for the cost cap. But even here, we agreed that the target figures of their and our cost cap (or "resource restriction", as they preferred to call it) were virtually the same. We agreed to put our respective financial experts together to agree the methodology.
We understood Ferrari's reluctance to publish figures but we saw no real difficulty because all the detail of the FIA method for checking and enforcing the cost cap had been worked out with the team chief executives in a series of meetings in the first half of 2008, with only Ferrari dissenting. We were also happy for the teams' own auditors to certify compliance, with outside auditors involved only if there was genuine suspicion of cheating.
No sooner had this been agreed than elements within FOTA tore up the agreement. The following Monday our financial experts were confronted with a blank refusal to discuss any of the FIA cost-cap provisions, notwithstanding the 2008 agreement with the teams.
FOTA then announced that it was going to run its own breakaway series.
Even if you've already judged him (which I know a lot of you have, and I'm willing to bet a good proportion of you post without even reading the article in its entirety, if at all), it still amkes for some pretty interesting reading.
