86 replies to this topic

[wj_gibson]

I think Ron is referring more to Sauber and Force India than to the two teams we presume to be dead in the water anyway.

[HeadFirst]

"The big teams don't need to "help" the smaller teams, they need to stop being greedy and split up the sports revenues more equally so that smaller teams can survive and compete on their own.

F1 racing won't get better by having half a grid of B teams that pull over every time an A teams car wants to pass them.

The F1 Strategy Group needs to pull their heads out of their butts and create a system that builds a healthy sport for everyone instead of just writing rules to fill their own pockets"

 

Why do they *need* to?  What business with hundreds of employees, millions in infrastructure investments, that relies on performing better than the others to exist says "hey, give my business less money so you can give more to my competitors so they have a better chance beating me."  That is ridiculous, is it not? F1 isn't society or the playground, it is a sport/business where every player knows how ruthless it is.

 

How about the NFL, NHL, MLB, and the NBA for a start.

[johnmhinds]

 

Why do they *need* to?  What business with hundreds of employees, millions in infrastructure investments, that relies on performing better than the others to exist says "hey, give my business less money so you can give more to my competitors so they have a better chance beating me."  That is ridiculous, is it not? F1 isn't society or the playground, it is a sport/business where every player knows how ruthless it is.

 

Being so ruthless that you kill of the sport you're competing in isn't good business sense.

The teams get over a billion dollars a year between them before we even start factoring in things like sponsorship money, if they can't share that out equally and still make hefty profits then the sport is being run by the worst businessmen on the planet. 

[Disgrace]

I don't see evidence in post-FOTA F1 to suggest that big team "help" is pure charity, but something like austerity. While austerity handed down from elites proclaims to be policy based in strong moral principle for all, it is actually a cover for their continued moral depravity. By keeping small teams in F1 on a financial leash (terms and conditions apply), the big teams can continue evading the long term solutions. In the event of three car teams, assuming it will go ahead with the collapse of grid numbers, McLaren do not have anywhere near the resources of Red Bull or Ferrari to be competitive.

[MirNyet]

Any idea's as to what sort of help he is offering?

[LORDBYRON]

 

Any idea's as to what sort of help he is offering?

 

Could be any one but it  may turn out to be not who we think.

 

 

http://www.forbes.co...rs-say-lawyers/

Edited by LORDBYRON, 14 December 2014 - 16:06.

[Jimisgod]

Any idea's as to what sort of help he is offering?

A certain Danish employee?

[CHIUNDA]

Ron said this that he thought some of the small teams might not make it to Melbourne

Is it so he dont have to run a third car as this and his drivers would be a cheap option ?



https://twitter.com/...008440164294656

For me this brings to the fore three things:-

1. I was reminded that the last time McLaren did this sort of thing, JB became WDC and moved from the ranks of has been drivers to the group of elites. Brawn, a near dead team won both championships and paved way for the return of Mercedes to F1 since the 50s. Needless to say, Mercedes then won both championships in 2014. Mercedes help to Williams has also seen the revival of that once great team.

2. This is a great way for McLaren to run plenty of mileage and gather extra data on its development parts without shouldering the full costs of running a 3rd car or a 2nd team. This should shorten the maturity curve for McLaren-Honda much the same way Mercedes benefited from its 3 engine customers.

3. Like has been said by many posters, It also provides an opportunity for McLaren to expose its young drivers to F1 and prepare them for the first team, without once again McLaren shouldering the full costs of a 3rd car or 2nd team.

Nothing socialistic about this approach if you look at it from this perspective.

[Bloggsworth]

Lotus, Force India & Sauber are on the edge, probably only kept afloat by some Hollywood accounting...

[chumma]

I think hes seat hunting for Magnussen more than anything with this gesture.

[Rob]

 

Nonsense. If you look at the early 90s you could finish 2 laps down and still be in the top 6.

 

 

Or in the 1995 Australian GP, second place.

[Maximus1]

What an ironic statement!!

I would have thought that Mclaren needs help themselves

[Morgan00]

I think hes seat hunting for Magnussen more than anything with this gesture.

 

I hope so. A season at the back end of the grid is still better than not racing at all. 

Edited by Morgan00, 15 December 2014 - 06:51.

[ViMaMo]

Can they run things like MotoGP way? Or FIA can find a suitable old chassis and engine/gearbox for the teams on the lower end of the grid. They can focus on racing, bring in young drivers, who race among a common platform.

[johnwilliamdavies]

I think Ron is referring more to Sauber and Force India than to the two teams we presume to be dead in the water anyway.

 

I'd have thought it would be Sauber and Lotus. If you look at the oil price, and it's affect on Venezuela (default on the way?) the PDVSA money is rather vulnerable.

[anbeck]

Can they run things like MotoGP way? Or FIA can find a suitable old chassis and engine/gearbox for the teams on the lower end of the grid. They can focus on racing, bring in young drivers, who race among a common platform.

 

That's what I thought a few years ago: Give Dallara some of the TV money and let them develop a chassis that is sold to any interested party, but which can also be developed freely by any of the teams who bought it. This will mean that we won't have any B-teams that will be too closely associated to the big ones politically. And we won't have a Mercedes GP customer car fill the final slot on the podium.

At the same time, the fact that such a subsidised chassis could be developed freely would mean that although all Dallara teams shared the same tub, they could add bits and pieces that would make the cars different over the course of a season, and it would allow new teams to build expertise and facilities over a few years until they would be able to build a whole car themselves.

 

Engine-wise, the same thing could be done. You could argue that the attempt to make Cosworth a real available alternative didn't work out that well, as its customers jumped the ship one by one. But I think it could work as something more than a stopgap  if done in a better way.

 

Given that Ferrari gets a bigger share of TV money, I don't see any reason why Dallara or some other constructer shouldn't get a little subsidy as well. 

 

Sorry, I got a little OT. But if the big teams really wanted to help smaller teams, there is no way around restructuring the distribution of TV money - whether you give it to smaller teams directly or supply some kind of supplier is another thing.

[ViMaMo]

Yeah instead of spreading their limited resources too thin and to very limited effect, they can do this ^ .

[mclarensmps]

Here I was thinking that Ron had an ego the size of Jupiter...

[Doughnut King]

How about the NFL, NHL, MLB, and the NBA for a start.

 

It's not really applicable to F1, but the NFL also has the draft system, a system that is meant to even out the competition.

[HeadFirst]

Can they run things like MotoGP way? Or FIA can find a suitable old chassis and engine/gearbox for the teams on the lower end of the grid. They can focus on racing, bring in young drivers, who race among a common platform.

 

Not sure you even have to go that far. Eliminate the requirement to produce your own car, and someone like Dallara might step up to produce a customer car. It is also possible that one or more of the current teams would sell customer versions of their chassis, as was the case with RB/TR up until ..... 2009.

[HeadFirst]

It's not really applicable to F1, but the NFL also has the draft system, a system that is meant to even out the competition.

 

Sure it is applicable. The examples I quoted all have some form of financial support for the less wealthy teams. MLB for example, has revenues from the television contract distributed equally, a luxury tax on the big spenders, which also goes to help the weaker (financially) teams. The NFL and NHL both have some sort of revenue sharing, and the NBA has a luxury tax. All of these systems are designed to help teams at the lower end of the economic scale. For example small market Kansas City went to the World Series this year, and the Green Bay Packers (a community owned team) are perennially one of the top teams in the NFL. 

[ardbeg]

Who needs more than 16? Or 14 for that matter?

 

Why do we need cars 2-3 seconds of the pace? What did Marussia and Caterham provide to the casual F1 viewer? What have they done to deserve $20-30 million more?   At least Sauber can race mid pack, Force India can get podiums and Lotus can win.  They usually employ drivers on merit.

If you remove the tail end, the midpack will become the new tail end. FI, Sauber and Lotus will be the one that comes last. Their income would drop. The will become the new Caterhams and Marussias. So we don't need them and run with eight cars. Maybe six. They've tried it and it was not a success.

[ardbeg]

I wonder if obliging the big teams to run a second team, like red bull and STR, would be the answer? It would ensure a full grid, give young drivers a place to learn and possibly provide a less disparate grid?

It would increase the cost but not the income. I'm not sure that is a sound business model.

[Nathan]

HeadFirst

 

How about the NFL, NHL, MLB, and the NBA for a start.

 

 Perfect place to start, as long as we understand we can't reverse history.

 

NHL is pricing the potential Seattle expansion fee notion north of $250 milliion USD. There is crazy talk that if an owner wanted to put another hockey team in the Toronto area the party would have to pay over $1 billion, with a kick back to the cash flush Toronto Maple Leafs for sharing their turf.  Sound Scuderia-esque?

 

The last NBA expansion team paid $300 million USD. That was split equally amongst the other NBA team owners. Talk of Seattle 2.0 is $800 million. That is just to have the right to operate an NBA franchise and get a slice of revenue pie.

 

NFL...Texas owner paid $700 million. Again, mostly split amongst the current owners. You can be darn sure the next time it will start at one billion.

 

Back in 2006 the eleven F1 teams had the chance to match the CVC offer of $2 billion. Adopting the franchise model would have cost each $182 million.   Every time Bernie offered to sell his kit to the teams the teams said no. $182m sounds like f-ing peanuts compared to the sports/business leagues you speak of, especially with hindsight as that is almost what each franchise would now be making in FOM revenue annually.

 

To be fair most teams probably couldn't have done so, and in 2006 when FOM was sold five buyers under the franchise model would have had to have been auto manufactures. Until the end of this season three of those auto manufactures haven't been participants for more than a few years now. Would that have produced a stable, healthy Formula-1?

 

Back in 2006 where was Frank and Alex going to find their $183 million to buy a seat at the revenue pie pan? CVC Partners-Williams Grand Prix Engineering Limited?.. Ron and Mercedes paying for this right after constructing the MTC?  2007 would have broke him.. Did Fiat have that cash handy? Having owned two teams Honda and Red Bull would each have had to pay $366 million on top of what they actually did. Was that all realistic at the time? Perhaps it was.  It is hard to argue F1 wasn't worth $2 billion at the time, and besides, something is worth whatever its owner deems.

 

Under the franchise model, who would have shown up to buy Midland? The Mol's didn't have that kind of money. Did Mallya?

 

So F1 would have been left with a half dozen teams??

 

So far converting to the franchise model sounds like eldestructo to me. Especially since CVC values F1 at $9 billion now, which seems reasonable because that is talking NFL money to get in on NFL revenues.

 

Then there are the capital costs that I won't further bore you with.

 

Two lasts things, someone will jump in on revenue sharing which is really no different to Ferrari and Red Bull get more money as they do now, and lots of NBA, NHL and MLB team owners lose money.  MJ can feel Lopez/Mallya like pain, from Forbes...

 

"The massive losses are the reason Michael Jordan was able to buy a majority stake in the Bobcats (he previously was a minority owner) in a deal that valued the franchise at the fire-sale price of $175 million in March 2010. Jordan also pledged $100 million to cover the team’s losses which have picked up in recent seasons. The team has lost an average $20 million over the last three seasons, $6 million more than any other team in that period."

 

Soooo is the NBA dying?!?!?!     Doesn't the NHL still own the Phoenix Coyotes because no one wants to take the team over? 7000 people at Panthers games?!?  NHL... R.I.P.

Just always remember, many times the teams had the chance to buy from Benie what they gave him to begin with.

[Nathan]

 

ardbeg

If you remove the tail end, the midpack will become the new tail end. FI, Sauber and Lotus will be the one that comes last. Their income would drop. The will become the new Caterhams and Marussias. So we don't need them and run with eight cars. Maybe six. They've tried it and it was not a success.

 

 

They should just run GP2 with F1, then Marussia and Caterham would have looked better for sponsors and investors.

 

Formula-1 is too expensive, that is the #1 problem.  Even if every team was paid the same by FOM Marussia and Caterham would just be having their estate sales next season instead because they would still be racing for last.

 

That fact you have to spend $100 million USD/year just to not finish last is more mind bending than Ferrari getting special payments.

[Lennat]

They could offer them a cheap supply of Honda engines (some extra mileage might be useful) and have them run Vandoorne and Magnussen, I suppose... 

[Brazzers]

Any idea's as to what sort of help he is offering?

 

Provide useful Ferrari data like the good old days. 

[HeadFirst]

 Perfect place to start, as long as we understand we can't reverse history.

 

NHL is pricing the potential Seattle expansion fee notion north of $250 milliion USD. There is crazy talk that if an owner wanted to put another hockey team in the Toronto area the party would have to pay over $1 billion, with a kick back to the cash flush Toronto Maple Leafs for sharing their turf.  Sound Scuderia-esque?

 

The last NBA expansion team paid $300 million USD. That was split equally amongst the other NBA team owners. Talk of Seattle 2.0 is $800 million. That is just to have the right to operate an NBA franchise and get a slice of revenue pie.

 

NFL...Texas owner paid $700 million. Again, mostly split amongst the current owners. You can be darn sure the next time it will start at one billion.

 

Back in 2006 the eleven F1 teams had the chance to match the CVC offer of $2 billion. Adopting the franchise model would have cost each $182 million.   Every time Bernie offered to sell his kit to the teams the teams said no. $182m sounds like f-ing peanuts compared to the sports/business leagues you speak of, especially with hindsight as that is almost what each franchise would now be making in FOM revenue annually.

 

To be fair most teams probably couldn't have done so, and in 2006 when FOM was sold five buyers under the franchise model would have had to have been auto manufactures. Until the end of this season three of those auto manufactures haven't been participants for more than a few years now. Would that have produced a stable, healthy Formula-1?

 

Back in 2006 where was Frank and Alex going to find their $183 million to buy a seat at the revenue pie pan? CVC Partners-Williams Grand Prix Engineering Limited?.. Ron and Mercedes paying for this right after constructing the MTC?  2007 would have broke him.. Did Fiat have that cash handy? Having owned two teams Honda and Red Bull would each have had to pay $366 million on top of what they actually did. Was that all realistic at the time? Perhaps it was.  It is hard to argue F1 wasn't worth $2 billion at the time, and besides, something is worth whatever its owner deems.

 

Under the franchise model, who would have shown up to buy Midland? The Mol's didn't have that kind of money. Did Mallya?

 

So F1 would have been left with a half dozen teams??

 

So far converting to the franchise model sounds like eldestructo to me. Especially since CVC values F1 at $9 billion now, which seems reasonable because that is talking NFL money to get in on NFL revenues.

 

Then there are the capital costs that I won't further bore you with.

 

Two lasts things, someone will jump in on revenue sharing which is really no different to Ferrari and Red Bull get more money as they do now, and lots of NBA, NHL and MLB team owners lose money.  MJ can feel Lopez/Mallya like pain, from Forbes...

 

"The massive losses are the reason Michael Jordan was able to buy a majority stake in the Bobcats (he previously was a minority owner) in a deal that valued the franchise at the fire-sale price of $175 million in March 2010. Jordan also pledged $100 million to cover the team’s losses which have picked up in recent seasons. The team has lost an average $20 million over the last three seasons, $6 million more than any other team in that period."

 

Soooo is the NBA dying?!?!?!     Doesn't the NHL still own the Phoenix Coyotes because no one wants to take the team over? 7000 people at Panthers games?!?  NHL... R.I.P.

Just always remember, many times the teams had the chance to buy from Benie what they gave him to begin with.

 

So aside from the history lesson what is your point? I was responding to this question ... 

 

What business with hundreds of employees, millions in infrastructure investments, that relies on performing better than the others to exist says "hey, give my business less money so you can give more to my competitors so they have a better chance beating me."  That is ridiculous, is it not? F1 isn't society or the playground, it is a sport/business where every player knows how ruthless it is. 

 

The businesses I mention are doing exactly that, giving up a share of the profits to the competition for the betterment of the sport as a whole. Btw (just as an FYI) the Coyotes have been sold to new owners  http://www.cbc.ca/sports/hockey/nhl/nhl-finalizes-sale-of-phoenix-coyotes-to-new-owners-1.1367926 and most experts believe that the concept of territorial rights is open to debate  http://www.thehockey...rn-Ontario.html . I am not suggesting in any way that the F1 situation is an easy fix, only that the concept of revenue sharing in sports in neither ridiculous, nor new.

[aguri]

If they don't share revenues there will be no revenues to share.

 

A sport doesn't grow if over half the grid physically can't cultivate any success or fanbase.

[Nemo1965]

 Perfect place to start, as long as we understand we can't reverse history.

 

NHL is pricing the potential Seattle expansion fee notion north of $250 milliion USD. There is crazy talk that if an owner wanted to put another hockey team in the Toronto area the party would have to pay over $1 billion, with a kick back to the cash flush Toronto Maple Leafs for sharing their turf.  Sound Scuderia-esque?

 

The last NBA expansion team paid $300 million USD. That was split equally amongst the other NBA team owners. Talk of Seattle 2.0 is $800 million. That is just to have the right to operate an NBA franchise and get a slice of revenue pie.

 

NFL...Texas owner paid $700 million. Again, mostly split amongst the current owners. You can be darn sure the next time it will start at one billion.

 

Back in 2006 the eleven F1 teams had the chance to match the CVC offer of $2 billion. Adopting the franchise model would have cost each $182 million.   Every time Bernie offered to sell his kit to the teams the teams said no. $182m sounds like f-ing peanuts compared to the sports/business leagues you speak of, especially with hindsight as that is almost what each franchise would now be making in FOM revenue annually.

 

To be fair most teams probably couldn't have done so, and in 2006 when FOM was sold five buyers under the franchise model would have had to have been auto manufactures. Until the end of this season three of those auto manufactures haven't been participants for more than a few years now. Would that have produced a stable, healthy Formula-1?

 

Back in 2006 where was Frank and Alex going to find their $183 million to buy a seat at the revenue pie pan? CVC Partners-Williams Grand Prix Engineering Limited?.. Ron and Mercedes paying for this right after constructing the MTC?  2007 would have broke him.. Did Fiat have that cash handy? Having owned two teams Honda and Red Bull would each have had to pay $366 million on top of what they actually did. Was that all realistic at the time? Perhaps it was.  It is hard to argue F1 wasn't worth $2 billion at the time, and besides, something is worth whatever its owner deems.

 

Under the franchise model, who would have shown up to buy Midland? The Mol's didn't have that kind of money. Did Mallya?

 

So F1 would have been left with a half dozen teams??

 

So far converting to the franchise model sounds like eldestructo to me. Especially since CVC values F1 at $9 billion now, which seems reasonable because that is talking NFL money to get in on NFL revenues.

 

Then there are the capital costs that I won't further bore you with.

 

Two lasts things, someone will jump in on revenue sharing which is really no different to Ferrari and Red Bull get more money as they do now, and lots of NBA, NHL and MLB team owners lose money.  MJ can feel Lopez/Mallya like pain, from Forbes...

 

"The massive losses are the reason Michael Jordan was able to buy a majority stake in the Bobcats (he previously was a minority owner) in a deal that valued the franchise at the fire-sale price of $175 million in March 2010. Jordan also pledged $100 million to cover the team’s losses which have picked up in recent seasons. The team has lost an average $20 million over the last three seasons, $6 million more than any other team in that period."

 

Soooo is the NBA dying?!?!?!     Doesn't the NHL still own the Phoenix Coyotes because no one wants to take the team over? 7000 people at Panthers games?!?  NHL... R.I.P.

Just always remember, many times the teams had the chance to buy from Benie what they gave him to begin with.

 

Interesting post. Always nice to have some historical background. Thanks.

[charly0418]

Its hard to take Ron seriously when seeing how Boullier acted during the US GP team principals press conference

[mclarensmps]

Its hard to take Ron seriously when seeing how Boullier acted during the US GP team principals press conference

 

That may depend on who you think Ron is talking about and who Boullier was alluding to in that Press Conference. 

[charly0418]

That may depend on who you think Ron is talking about and who Boullier was alluding to in that Press Conference. 

 

Eric was pretty direct on that press conference, he didn't want to share more money to the smaller teams. Plain and simple.

 

He was defending McLarens interest so I honestly cant blame him

[kevinracefan]

and Caterdog was within .5 of the red dogs...

[mzvztag]

There is no place for socialism in F1.

 

There is place, even necessity, for socialism in everything. otherwise, the humanity is doomed.

And I really mean it.

Edited by mzvztag, 16 December 2014 - 18:40.

[Disgrace]

Let's keep it to F1 though, for the sake of the thread. Everyone is otherwise more than welcome to apply to the Paddock Club if you're seeking political discussion.

[mclarensmps]

Eric was pretty direct on that press conference, he didn't want to share more money to the smaller teams. Plain and simple.

 

He was defending McLarens interest so I honestly cant blame him

 

The teams that were in question at the time were Caterham and Marussia. I think here we are talking about more sustainable outfits. 

Just to clarify: *I THINK* we are talking about the more sustainable outfits. We may very well be talking about the absolute minnows whom are in and out, but I suspect not...