On Cutting costs in F1

[GilesGuthrie]

I've been thinking about this cost-cutting nonsense for a while now, and it strikes me that no simple rule change can cure the financial discrepancy between the larger teams and the smaller teams.

This is because the larger teams will always have more money than the smaller teams, because the sponsors will always want to sponsor the more successful teams.

And the one thing that you can rely on engineers for is to spend money that is available to them. And the more money they spend, the more outlandish the ideas they have.

So the problem faced by the governing body is to create a formula that conveys no advantage with increased spend. This will be hard for them to do, because money almost always confers advantage, through increased time in wind tunnels, research labs, metallurgy etc.

To do this, the FIA would have to create so many 'control' parts that they would cause F1 to be devalued through the loss of its status as the most technologically advanced formula in the world.

It's a tough balance to strike. I'm hoping that the current measures will at least be a step in the right direction.

 

[Jordan]

Doesn't a each team get TV money when they score points at a race? And, the more points they score, the more money they are given? It looks like spreading that out evenly among all teams would be one way to help.

 

[GilesGuthrie]

The TV monies are divided out in championship order, with more money going to the higher-placed teams. This is one area that's most under criticism and will have to change, at the renegotiation of the Concorde Agreement in 2006 at the latest. My guess is it could change before then though.

 

[advanR]

would a salary cap type system help things? not for drivers, but for the car development and everything else. everyone can only spend the same amount.

 

[Bollocks#999]

How about Bernie gives more back to the teams than what he does currently and then there would be no more talk of a breakaway series in 2007?

 

[GilesGuthrie]

Originally posted by Bollocks#999
How about Bernie gives more back to the teams than what he does currently and then there would be no more talk of a breakaway series in 2007?

The breakaway's not going to happen. Why do you think the GPWC are so upset about the latest changes? They are having the rug comprehensively pulled from underneath them.

Never underestimate the power of Mosley/Ecclestone.

 

[vat_man]

Originally posted by GilesGuthrie
The breakaway's not going to happen. Why do you think the GPWC are so upset about the latest changes? They are having the rug comprehensively pulled from underneath them.

Never underestimate the power of Mosley/Ecclestone.

I wondered what that was about - it's a little confusing, with a couple of the engine providers indicating they're happy to supply other teams (i.e. Mercedes and Renault), and then the GPWC members going berzerk.

I think they've gone a little far in some areas, although I like the idea of being allowed to share components if you want.

 

[GilesGuthrie]

Component sharing does make a lot of sense, and has been working in World Rallying for a while now. I don't know if it's still the case, but the Skodas were running with modified Prodrive Impreza drivelines.

I've never really thought that the GPWC would make any headway, simply because the car manufacturers are only united against a common enemy. The thing is that if that enemy were to disappear, they would lose that simple direction and fall into disarray, and we'd be right back where we were in the early 80s with the 'grandees' (Ferrari, Alfa, Renault) against the garagistes (Williams, McLaren, Tyrrell, Lotus).

I also think that the GPWC members, if taken individually, lack the stomach for a fight. And if you go back in history, to when Max deposed Balestre as FIA chairman, or when Bernie singlehandedly won the FISA/FOCA war, these things always come down to massive PERSONAL combat situations, where there is a lot of face-to-face, one-to-one lobbying. Max and Bernie are specialists at it, and the simple fact is that there's no-one on the GPWC capable of standing up to them, save perhaps Jurgen Hubbert, and I think he's quietly setting himself up to be Bernie II, in which case it would be imprudent to be too antagonistic towards Bernie I.

Seriously, anyone who hasn't read Timothy Collings' The Piranha Club should do. EVERYTHING that is currently happening in F1 has happened before, and it's all there in Collings' book.

 

[Wastegate]

Here's my take on the cost-cutting situation. The reason for the current cost-cutting measures is not to close the performance gap between the teams, but purely to cut costs. F1 may be the pinnacle, the elite - but it's been in danger of becoming so eliteist that only the best and richest of the elite could afford it.

Engine budgets were in danger of becoming higher than the total budgets of the smaller teams. When even medium sized teams like Jordan had to cut staff and employ pay drivers (the well backed and talented Sato) in 2002 despite full sponsorship on the car the writing was on the wall.

The succesful teams will always attract more money, and money usually means success in any motorsport. Even in forms of with spec chassis or purchased chassis such as F3000 or CART the winners are always the richest teams.

Successful teams like Ferrari, Williams and McLaren will always be able to attact more money that teams like Minardi, and so long as it's spent wisely will result in some kind of performance advantage, even if it's just in testing chassis set-ups or making 100 different suspension components to test them aerodynamically.

And there's little new in the rules. Component sharing was common 10 years ago when midfield teams like Footwork and Ligier bought technology from McLaren and Williams, before the practice was outlawed by the FIA.

In answer to Bollocks#999 question about the distribution of TV money, I don't thing Bernie is in control of this any more, since the sale of the rights to Kirch. Since their collapse the control is in the hands of some bankers, and it could be very difficult to get them to give up profits!

What the meetings last week did achieve is a more even split of the TV money available amongst the teams, so that the likes of Ferrari get less than previously and Minardi more. But the exact details are top secret.

 

[Pupik]

There are almost no ways to truly cut costs in F1. You can ban something, but the teams just develop a new way around the ban, which costs more money. So if you banned carbon-fiber for example (it's expensive),the teams will just research a new substance. And of course, if it's a flop, then you pay even more to fix the problem. Better teams are better funded, more prizes and pay-outs, more sponsors, it's a vicious cycle.

There are only a handful of sure-fire ways to keep costs down, most of which are unpopular ideas, and even go against the sporting nature of F1:

1) Spec engines or chassis
2) One fuel brand for all teams
3) One make of tires

If you put a spending-cap in place, how would you enforce it? Have an FIA-appointed agency follow the teams around, and prove their spending through receipts?

 

[vat_man]

Originally posted by GilesGuthrie
Seriously, anyone who hasn't read Timothy Collings' The Piranha Club should do. EVERYTHING that is currently happening in F1 has happened before, and it's all there in Collings' book.

Next in the queue, after Perry's book.

 

[Bollocks#999]

will have to read this one
...right after murry walkers (muddly talker ) book