Archive: budget cap

The Formula 1 news has been dominated by political activity of late. I have struggled to bring myself to write about it, but today’s events seem like a good stage to provide an overview of where things stand.

This business with Ferrari taking the FIA to court over a veto is very interesting. Ostensibly the loss of the court case is bad news for Ferrari, but in fact their point has been proven. The court did confirm that Ferrari do have such a veto — just that they have failed to play their card correctly.

What this has conveniently done, though, is proved the point that the FIA simply are not to be trusted in this sort of situation. This technical veto — along with a host of financial and sporting perks — was given to Ferrari as a reward for jumping into bed with the FIA the last time the governing body’s power was put into question. GPWC (later GPMA) was an alliance of some of F1′s biggest names. It was essentially a bargaining tool for the teams not unlike today’s Fota. Ferrari was a major player in it — until the FIA lured them away with bribes. With Ferrari gone, GPMA was toothless and little was heard of it ever again.

This time, Ferrari aren’t for turning. The threat to the FIA’s power is therefore much greater this time round. So the FIA has preoccupied itself with looking for ways to either break up or undermine Fota. That is why they have this sudden obsession with new teams, even though there have been vacancies on the grid for over ten years. I seriously doubt we’d be hearing about how vital it is to attract new teams were it not for Fota. By doing whatever they can to bring in new teams, the FIA can ensure that there will no longer be unanimity among the teams.

After all, the FIA does not really have much else going for it. Participants, fans, media commentators and other onlookers have all completely lost faith in the FIA as it brings in ever-dafter regulations that lack any cohesion. For just one example, they will constantly bang on about cost cutting, then force teams to incur further costs by radically changing the regulations periodically.

Moreover, the FIA constantly fail to meet their own regulations, such as when earlier this year they attempted to change the sporting regulations within days of the season starting without first consulting the teams. Nor can the FIA administrate the sport in an even-handed way, as has been patently demonstrated by countless unfathomable stewards’ decisions over the past few seasons. The FIA is also wholly inadequate at formulating or policing the technical regulations, as is apparent with the completely botched introduction of kers and their inability to simply tell anyone if the double deck diffuser was legal.

Earlier this year Fota put forward a measured set of proposals that were based on actual market research which was conducted in an open and transparent manner. By contrast, Max Mosley just plucks new rules out of his freshly spanked arse. The FIA changes the regulations willy-nilly, out of the blue, for no apparent reason, without consulting anyone. The views of the teams, drivers, fans and the wider industry all count for nothing as far as the FIA is concerned.

This is the nub of the matter really. As has now become clear, the budget cap controversy was merely a conduit for a larger battle to begin — a battle over the governance of the sport. Do we want Formula 1 to continue to be driven into the ground by a frustrated politician who has no interest in consulting the people who really matter to the sport? Or would we prefer a future where fans and teams have a say, and where regulation changes can be measured and predictable? Well, I know whose side I’m on.

While people may scoff at the apparent arrogance of Ferrari’s recent statements, they do have a point. As readers will know, I am no Ferrari fan. But there is no doubt that this brand carries a lot of history, a lot of status, a lot of respect, a hell of a lot of fans and money by the bucket load. Arguably, the Ferrari brand is much more famous than the Formula 1 brand.

So Ferrari’s point about the calibre of the supposed new teams is bang on in my view. Make no mistake, the vast majority of these are teams that under normal circumstances would not be able to even consider entering F1, with an F1-standard car at an F1-standard budget. It is feasible only with the FIA promising to skew the rules in their favour — just as they skewed the rules in Ferrari’s favour back in 2005. This sort of crap has no place in a “sport” in the 21st century.

Privateer teams may be romantic, and I would love to see decent private teams to be able to compete at an F1 standard on merit, just as Brawn and Williams do today. But F1 is supposed to be the pinnacle of motorsport. And though some of the proposed new teams are accomplished enough at certain levels, few if any could claim to be on the cusp of being at F1 standard in normal circumstances.

As Joe Saward put it, it beggars belief that Max Mosley would think that it would be worth trading names like Ferrari, Toyota, Renault, BMW and potentially Mercedes for names like Wirth Research, Epsilon Euskadi, RML, Formtech, Campos and so on. Ask Max Mosley’s precious “man in the pub” about any of the names from the first list, and their eyes will light up in recognition. Asking about names from the second list would elicit a nonplussed response.

A grid full of teams like this, and with none of the historic and famous names that mean so much to people, would be an empty F1 indeed. It could be a return to the bad old days of the late 1980s and early 1990s, when the grid was full of half-arsed operations which polluted the field and acted as mobile chicanes. The FIA went too far in its efforts to get rid of these teams in the mid-1990s. Now it seems happy enough to go too far back the other way.

Max Mosley’s case seems utterly weak. He should know that too, because the last time he threatened the teams by forcing them to enter at short notice, the list of “new teams” was similarly long. Of these teams, one — Prodrive — was given the nod. It never materialised because the FIA decided to forego the biggest opportunity to cut costs they could ever ask for by making customer cars illegal.

As before, these new teams look like paper tigers. Yet Max Mosley is hinging the future of the sport on them because he finds it more palatable than relinquishing any of his power.

The other big news to come from the FIA last week was its proposal for an optional budget cap limiting teams to a budget of £40 million excluding costs of drivers, engines, hospitality, marketing and fines (because that’s the FIA’s money, duh!). I don’t particularly have a problem with a budget cap in theory.

Cutting costs has been the biggest issue in Formula 1 for years, and not just from the FIA’s perspective either. Beforehand, though, the approach was to institute ever more barmy technical restrictions which, it can be argued, have adversely affected the racing. All the while, teams still spent the same amount of money simply trimming off weight and having their CFD systems create increasingly alien aerodynamic tricks.

Ideally, I would think that F1 teams should be free to raise however much money they like and spend it as they see fit. But just now it is clear that this is an untenable situation. So we must make a choice. As an F1 fan, given a choice between strange technical restrictions (18,000 RPM limit on the engine? Why? To prevent faster cars catching slower cars?) and a budget cap, I would opt for the budget cap any time. F1 is, after all, supposed to showcase the best technology. F1 teams can still do this with a limited budget so long as they have the freedom to innovate.

But it is the FIA’s motives behind the budget cap that concern me. Alongside the budget cap comes a raft of other proposals that hint towards a complete U-turn in FIA policy towards new teams.

For the best part of a decade-and-a-half, the FIA have made it difficult for new teams to enter F1. The main form this took was in the entry bond. Following the Mastercard Lola debacle of 1997. Under pressure from the title sponsors, the Lola car was rushed out a year earlier than originally intended. It went to Albert Park having done almost zero testing. The cars were a dozen seconds slower than pole position during qualifying. Before round two in Brazil, Lola went bust.

After that, new teams had to pay a $48 million entry bond in order to demonstrate that they were financially stable. That is why the trend has been for new teams to buy old teams rather than start from scratch (which only Toyota and Super Aguri did while the bond had to be paid). The entry bond was dropped a couple of years ago in recognition of the dwindling grid.

Now the FIA seems determined to welcome back smaller private teams, having spent the past decade driving them out, keen to avoid another Lola. Now, they will welcome any new interest with open arms — including Lola! There is also apparent interest from Prodrive / Aston Martin, not to forget USF1 which launched earlier this year.

A number of GP2 teams are also bound to be eyeing an entry to F1. iSport have dropped a heavy hint, while ART, Campos and Racing Engineering are also said to be interested. In March, Joe Saward believed that five new teams were in the pipeline. That number will have surely increased since then.

It is unusual because there probably haven’t been so many teams seriously considering entering F1 since the early 1990s. And it is not as though the small grid is a new problem. For several years there has been space on the grid for 24 cars. F1 has not seen more than 22 cars enter a race since 1995 (excluding the ill-fated Lola in 1997 for one race). Indeed, for four of the last seven seasons there have been only 20 cars on the grid.

Not only have the FIA introduced budget cap proposals in order to attract new teams, but FOM have agreed to actively make it easier for new teams to enter. This will come in the form of free chassis transportation and free air travel for employees. Plus, far from having to pay a $48 million entry bond, new teams will now be paid $10 million per year to enter! I’ll buy two please!

All of this is on top of the plan to increase the maximum number of cars that will be allowed to enter the championship. The grid could now potentially increase in size from 20 cars this year to 26 cars next year, the first time in recent years the FIA have countenanced such an idea.

Why does the FIA have a sudden interest in swelling the size of the grid? Could it possibly have something to do with that pesky Fota organisation that is giving the FIA a bit of well-deserved heat just now?

All ten Formula 1 teams are presenting a united front at the moment. Despite their considerable differences, the ten teams have just about managed to put them aside in order to stand up to the FIA and Bernie Ecclestone, who find it difficult to credibly counter such unanimity among the teams.

It is difficult enough for the ten teams to remain so friendly with each other. It would be awfully helpful if the FIA could make it eleven, twelve, thirteen teams that have to get on with each other. To make those extra new teams be teams that are on the same page as the FIA — as the new teams naturally would be — that would be a stroke of genius. All of a sudden, Fota would not be quite so credible.

The new teams are joining specifically because of the new budget cap, and they will be happy enough to plug an FIA-supplied Cosworth engine into their cars. They will be happy to acquiesce to the FIA’s mad plans for years to come.

Most fans like to see larger grids, and many of us love to watch a small team take on the big guns. But Fota is the best chance there is for the future of Formula 1 to be mapped out in a way that is fan-friendly.

The budget cap may ostensibly be a way of securing the future of Formula 1. But the new teams could be the biggest threat to the chance of actually improving it.

Today the World Motor Sport Council met to make its decisions and already F1′s bloggers and Twitter users have been voicing their opinions. Here are some of my more in-depth thoughts.

Points

The points system for 2009 has been amended, and the result is a compromise between Bernie Ecclestone’s controversial ‘medals’ proposal and the current points system. Basically, the current 10-8-6-5-4-3-2-1 system will remain in tact, but the Drivers’ Championship will be awarded to the driver with the most wins.

I have long been in favour of a radical change to the points system, and I am quite receptive to a “medals-style” system. But many other fans were not so keen.

This compromise solution isn’t one that I have seen suggested before. But on the face of it, it seems like a fair enough compromise. I would still prefer a more radical change to the points system, rather than having the championship automatically going to the driver who has had the most wins. But this could have been much, much worse.

Testing

From now on, teams will be allowed three young driver training tests between the end of the championship and the end of the year. I believe that such tests were unlimited before (correct me if I’m wrong). This represents yet another barrier to the young drivers that Max Mosley purports to be helping.

Straight-line testing is also facing further restrictions. Between 1 January 2009 and the end of the championship, teams will be allowed only eight days of straight-line or constant-radius testing. As pointed out by @sidepodcast on Twitter, this could leave McLaren in trouble given the amount of straight-line testing they have already done this year.

I’m not opposed to limits on straight-line testing. It seems fair to limit it just as other testing is restricted. However, applying this retrospectively does seem to be rather underhanded, and is especially unfair on those teams that took advantage of straight line testing a lot over the winter. Is it yet another FIA anti-McLaren conspiracy? Don those tin foil hats! Say what you like about Max and Bernie, but they sure know how to stir up a fuss!

Qualifying fuel loads

The weights of all cars after qualifying will now be published. This will give the geeks (like me) a lot of interesting data to analyse on a Saturday evening. But I’m not sure how this will improve the show. Personally, the suspense surrounding a driver’s fuel load is the only good thing about having race fuel loads during qualifying. I quite like not knowing when the leaders are going to take a pitstop.

People talk about F1′s script writers. Well now we will have a “spoiler” long before the race has even begun. This is a shame.

I assume this is a response to those who lament the fact that qualifying no longer shows who the fastest driver is. But the real solution to this would be to get rid of the ridiculous race fuel load idea altogether. It has never worked, and it adds nothing to the show.

Tyres

Just a small one this. Wets are now officially “intermediates” and extreme wets are “wets”. This seems rather uncontroversial to me, because I normally refer to inters and extreme wets. Since inters became such good all-round wet weather tyres, this problem has existed, and it’s good that the FIA has tried to inject a rare bit of clarity into the regulations.

Media

Drivers will now have to make themselves more available to sign autographs. And there will be no running away in a fug of embarrassment after a poor performances. All drivers must make themselves available to the media for interview after the race or after they have retired.

Senior team personnel will also have to make themselves available to TV crews. Fota had proposed a similar idea anyway, and it’s a good idea to ensure that the fans get more out of the sport.

Changes to the 2009 Technical Regulations

You what? Yes, apparently the FIA have changed the 2009 Technical Regulations, details of which will be published later today. Haven’t they left it a bit late?…

The batshit-crazy zone

Mind your step. This is where we enter the realms of nonsense. It wouldn’t be the FIA without a nice dose of nonsense, and they certainly haven’t disappointed this time round.

From 2010 onwards there will be a budget cap of £30 million per season. But it’s a voluntary budget cap. So to give teams an incentive to stick to the magic limit, the FIA will allow these teams to have more technical freedoms. Essentially, there will be not one but two sets of Technical Regulations. Maybe from 2010 onwards the sport will become known as “Formulae Ones”, “Two Formula Ones”, “Formula One.1 and Formula One.2″.

In all seriousness, I think this is a recipe for disaster. For one thing, the FIA reckons it will be able to work out when “the cost-capped cars have neither an advantage nor a disadvantage when compared to cars running to the existing rules.”

Now I don’t know about you, but I quite like the idea that in F1 some cars are better than others. It’s called competition. It’s what sport is made of. And too often motorsports go down the route of trying to equalise performance between the cars by restricting the best cars. Then that series goes down the pan (hello, BTCC). That’s because people watch motorsport for the competition between teams and drivers. The moment you try to neutralise that, you start to alienate the core audience.

Besides, it’s all very well to do what they do in Touring Cars and add extra ballast to race-winning cars. But it’s a different thing altogether to try and work out how to manipulate cars when they are being run to separate sets of regulations. The FIA can’t even create one decent set of unambiguous technical regulations, never mind two of them, and with the aim of having the two types of cars performing equally!

For me, this just stinks. The FIA would be able to penalise cars for very little good reason, other than something vague about equalising performance. Decisions would probably be made in smoke-filled rooms, obscured from the fans’ view.

Believe it or not, F1 just got even more political.

Today the teams are all meeting in Maranello to discuss their response to Max Mosley’s calls for yet more cost-cutting in F1.

In a letter (PDF link) sent to each of the teams earlier this month, Max Mosley said:

Formula One is becoming unsustainable. The major manufacturers are currently employing up to 1000 people to put two cars on the grid. This is clearly unacceptable at a time when all these companies are facing difficult market conditions.

But it makes me wonder quite what qualifies Max Mosley to declare F1 “unsustainable”. I can’t help but notice a glaring hole in Mosley’s argument.

A central pillar of our economic system is the idea that individuals and firms are able to decide for themselves how best to use their resources. After all, the individuals and firms (in this case the F1 teams) have all the necessary information at their fingertips. If Formula 1 is sustainable for a team, that team enters. If it is unsustainable for a team, it does not enter. Simple as that.

If an F1 team finds it to its own advantage to employ 1,000 people to put two cars on the grid, so be it. That is a fact of life. If the teams really feel a need to cut costs, they will. It. Is. That. Simple. The idea that people make these decisions for themselves is a central pillar of liberal society.

Meanwhile Max Mosley, the head of the governing body, is sitting in an ivory tower and has seemingly just decided that he knows better than the teams. Despite the fact that he has absolutely no experience and no knowledge whatsoever of what it is like to run an F1 team in 2008. Sure, he was heavily involved in March — but that was over thirty years ago, when F1 was a very different world indeed.

To underline just how little information Max Mosley has on what it takes to run an F1 team, think back to his proposed budget cap. That was apparently met with some mirth among the teams. Flavio Briatore was particularly taken aback:

I already pay 40 per cent less than the cap. If I want to keep to the limit then I need to spend more. It’s nonsense.

So here is the situation. We have ten parties that find it sustainable to enter F1. We have one party that thinks it is not sustainable, and that is the party with the least amount of information on it.

Sure, there could and perhaps should have been twelve teams on the grid this year. But let us not forget that the reason the smaller teams left is because they were not given a suitable guarantee that customer cars would be allowed. And who is responsible for that? Oh yes, Max Mosley.

Right there, we had the perfect opportunity for costs to be cut in F1. But Max Mosley failed to let it happen. I can only conclude that he is not actually interested in cutting costs. This adds yet further weight to the suspicion that the FIA will use the “cost cutting” explanation to justify any of their mad schemes for the future of F1. “Cost cutting” is the back door through which Max Mosley’s endless vanity projects are shoved through.