The budget crap — another FIA political ploy

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.

4 comments

  1. Hi Doctor

    Great post, however I’m not sure that new teams would automatically follow the FIA line once they were established in F1.

    If a team makes it past the first season their issues will become much the same as the rest of the established teams. Yes their perspective would be closer to Williams or Red Bull than Mercedes McLaren or Ferrari, but they would be trying to keep sponsors happy, innovate, and ultimately win races just as much as the other teams.

    If their goals, constraints, and resources are the same (I don’t believe there will be any unlimited budget/restricted development teams for long) they’ll be able to unite on issues that are really important.

    Unless Bernie/Max continue subsidizing some teams I can’t see there being any special reason to follow the FIA party line (even the Ferrari sweetheart deal hasn’t kept them out of FOTA).

    More teams increases the challenge of building consensus, but we’re looking at 13 teams, not 30.

  2. Thanks for the comment OgRib. You may be right.

    The key point that you hit on is that the new teams will be closer to the privateers than the manufacturers. Generally, the privateers have tended to be closer to the FIA in recent years. But it’s been easier for the privateers’ views to be ignored simply because they are outnumbered by the manufacturers.

    It would certainly improve the situation in one sense, in that it will restore the balance towards the privateers, who are in it for the love of the sport and not just to make money. But I fear it is more likely that the FIA’s “divide and conquer” ploy will work.