90 replies to this topic

[FullThrottleF1]

Question say's it all.

[LuckyStrike1]

It's pretty much open isn't? 

There's available slots on the grid if anyone cares to enter an F1-team. 

[FullThrottleF1]

It's pretty much open isn't? 

There's available slots on the grid if anyone cares to enter an F1-team. 

My understanding is that it has to be agreed by the FIA and the Commercial Rights Holder.

[RedBaron]

I think most of the people on the Forbes rich list just send emails from Formula 1 right to their Junk folder now.

 

VW won't answer the phone.

 

BMW and Toyota both text back saying 'New phone who's this?'

 

Dave Richards is sitting by the phone, but it isn't ringing. He didn't pass the credit check.

[pdac]

My understanding is that it has to be agreed by the FIA and the Commercial Rights Holder.

 

This.

 

But in a fantasy world, no. Without any payment for 10th I can't see any sensible outfit wanting to take up the place and if there were some idiot, they'd most likely go the same way as Manor and probably in a shorter time frame. So all that would do is detract from any positive messages they might want to foster about themselves as the new guard.

[LuckyStrike1]

My understanding is that it has to be agreed by the FIA and the Commercial Rights Holder.

 

Formally yes of course. But it's not like anything stands in the way of a team applying to enter if they wish to and if they are somewhat realistic they will join. So no need for a tender, itäs already open for anyone with ambitions to apply. 

 

Problem is that very few that are entering have realistic prospects. We'll see how Haas will fare, but the loophole they could enter through to guarantee some survival is now closed. 

[FullThrottleF1]

10 teams for the rest of history, damn  

[LuckyStrike1]

10 teams for the rest of history, damn

 

 

You'll hate me then. I predict a F1 with only 5 teams but with multiple cars entered   

But in motorsport you can always count on someone with grand dreams and ambitions not quite matched by reality so it's not hopeless. There could always be a new backmarker joining. 

[Clatter]

My understanding is that it has to be agreed by the FIA and the Commercial Rights Holder.

If someone credible came a knocking i doubt they would be turned away. There are spare slots and not a queue of teams waiting so there's no need to wait for a tender process. The only reason teams came forward last time was because the FIA made a lot of promises regarding the costs which they failed to implement. If Liberty change the way the teams are paid then they might attract some offers, but otherwise I don't see any new teams entering.

[Clatter]

10 teams for the rest of history, damn

Or less unless something changes.

[Izzyeviel]

Stefan F1... 

[FullThrottleF1]

You'll hate me then. I predict a F1 with only 5 teams but with multiple cars entered   

But in motorsport you can always count on someone with grand dreams and ambitions not quite matched by reality so it's not hopeless. There could always be a new backmarker joining. 

That is the day I stop watching F1

[superden]

The days of people clamouring to get in to the circus are long gone, for many reasons.

[Thrasymakus]

I've said no not because I don't think they'll try to get new teams, but because Ross Brawn is in charge.

Rather than immediately try to replace the team he'll try to get costs down to a point where a new team can survive on a realistic budget (i.e. one pay driver and foolish millionaire owner). Then see who comes knocking.

By the end of this year I think we'll see some of the cost savings in place, early next year teams will start serious planning and by 2019 we'll see some new teams.

[pdac]

I've said no not because I don't think they'll try to get new teams, but because Ross Brawn is in charge.

Rather than immediately try to replace the team he'll try to get costs down to a point where a new team can survive on a realistic budget (i.e. one pay driver and foolish millionaire owner). Then see who comes knocking.

By the end of this year I think we'll see some of the cost savings in place, early next year teams will start serious planning and by 2019 we'll see some new teams.

 

I like your positivity, but I think the time-frame will be somewhat longer. By the end of this year we may hear some more detail placed on the one-liners that describe what LM plan to do, but there'll be no (significant) changes until some time later.

[Clatter]

I like your positivity, but I think the time-frame will be somewhat longer. By the end of this year we may hear some more detail placed on the one-liners that describe what LM plan to do, but there'll be no (significant) changes until some time later.

I agree, if for no other reason than it's likely existing contracts will need to expire first.

[BRG]

What happened to that promising sounding Romanian team Forza Rossa?

[wrighty]

i think, as mentioned previously, that the tender system will be history by the end of 2017 and F1 'should' have measures in place to make that kind of bidding war obsolete. Teams in GP2 need to be able to make the step up with a feasible resources increase, not the insane money printing oligarch backing they'd need at the moment....

[HP]

I thought the door is always open for new teams? Just get rid of the tender system. It's unnecessary fencing.

 

i think, as mentioned previously, that the tender system will be history by the end of 2017 and F1 'should' have measures in place to make that kind of bidding war obsolete. Teams in GP2 need to be able to make the step up with a feasible resources increase, not the insane money printing oligarch backing they'd need at the moment....

Yes and no. The issue will be not to cheapen F1 too much. If too affordable, F1's value vanishes. No way that Liberty accounting would agree to that. It's not exactly sound financial management to buy up F1 for a high price and then devalue it, unless they do it to get rid of F1 as a competitor. Right now there isn't competition to F1, so we can assume that Liberty's plan is to make F1 more valuable. That also means it won't be easy for new teams to get in. The classic "too successful for their own good scenario". The way IMO forward is to increase revenue, something under BE was not making the right moves. If revenues are higher, than teams get a larger share

 

If it stays where it is right now however, then F1 might hit the same ending as did the Concorde (the plane, not the F1 agreement). Out of date, too expensive. What will be left are good memories of times gone. Having said that, Liberty didn't buy up the commercial rights to let everything go down the drain.

[PayasYouRace]

Liberty could make the commercial side more appealing, but I'm sure it's the FIA who decide who enters.

[tormave]

Makes no sense to invite new teams in before something is done about revenue distribution and costs. Brawn seemed to have decent ideas about both.

[GrumpyYoungMan]

Ideas are one thing, implementing them another, after all no one would vote for or a agree to a pay cut!

[Lotus53B]

Ferrari's special bonus would pay for two teams, all historic payments would pay for three or four.

 

Iff Liberty/FOM/FIA can sort out the money in the sport we'll get new teams.  Until then, no.

[LuckyStrike1]

Or implement the long discussed, never materialised, budget cap. The one that HRT, Caterham and Manor once was falsely promised. 

I think that is easier than trying to convince Ferrari, McLaren, Mercedes, Red Bull and Williams to decrease their earnings substantially. 

[Lotus53B]

Budget caps won't work - the big teams can just offload projects to other "subsidiaries" and then charge the actual team tuppence for the work.  The FIA/Liberty couldn't afford the accountants to police it, the same as Apple/Google/Facebook/Starbucks/Amazon get away with paying 0.01% tax by shifting money through their subsidiaries so that the revenue can't trace it.

 

And if budget caps ever could be enforced, say, $100M you'd have a situation where Ferrari, Mercedes etc., were getting $100M free profit every year and taking money out of the sport.

 

Cap the payments, distribute the leftover.

[Pete_f1]

Come on, the future is electric and driverless. I.e. the much cheaper Formula E and Roborace.

[Wuzak]

Or implement the long discussed, never materialised, budget cap. The one that HRT, Caterham and Manor once was falsely promised. 

I think that is easier than trying to convince Ferrari, McLaren, Mercedes, Red Bull and Williams to decrease their earnings substantially. 

 

I think the problem with the budget cap plan was that was too low. $25m or 25m euros, I can't recall, it was about half that of a back of the field team at the time.

 

It certainly would not have worked for the major teams with 500-1000 employees and all the simulation gadgets.

 

One attractive thing about a budget cap, if it could be made to work, is that woudl allow the rules to be freed up - no wind tunnel restrictions, no track testing restrictions, etc. You could do whatever you want inside the budget limit.

[tormave]

Budget caps won't work - the big teams can just offload projects to other "subsidiaries" and then charge the actual team tuppence for the work.

Budget caps can work, but it's a major undertaking to police them. You could simply mandate, that any material flow to the team from outside requires open books also from those that provide it. If the supplier won't comply, the team needs a new supplier.

Brawn has however mentioned cost control approaches where the lap time enhancement from additional investments are rewarded much less than today. One such approach was discussed long time ago, namely defining a maximum downforce level. Easy to police by pushing the car down with the threshold force and measure that it's bottomed out.

[Clatter]

Budget caps can work, but it's a major undertaking to police them. You could simply mandate, that any material flow to the team from outside requires open books also from those that provide it. If the supplier won't comply, the team needs a new supplier.

Brawn has however mentioned cost control approaches where the lap time enhancement from additional investments are rewarded much less than today. One such approach was discussed long time ago, namely defining a maximum downforce level. Easy to police by pushing the car down with the threshold force and measure that it's bottomed out.

So they would have rerun that test every time a setup change was made to the car, and if they wanted to run the car at a higher height then they would have to change to a softer suspension setting even if that is not optimum. Not entirely against the idea, but don't really agree with the method.

[superden]

Come on, the future is electric and driverless. I.e. the much cheaper Formula E and Roborace.

Maybe. Probably.

But that'll be it for me and many others.

[LuckyStrike1]

Budget caps won't work - the big teams can just offload projects to other "subsidiaries" and then charge the actual team tuppence for the work.  The FIA/Liberty couldn't afford the accountants to police it, the same as Apple/Google/Facebook/Starbucks/Amazon get away with paying 0.01% tax by shifting money through their subsidiaries so that the revenue can't trace it.

 

And if budget caps ever could be enforced, say, $100M you'd have a situation where Ferrari, Mercedes etc., were getting $100M free profit every year and taking money out of the sport.

 

Cap the payments, distribute the leftover.

 

 

It would work. 

 

Yes, with the current payment distribution it would mean top teams would get a free profit and take money out of the sport but you would make it better for the smaller teams to survive as long as the budget cap is set low. 

 

Policing it would work, even when talking about groups such as Mercedes. 

But it won't happen, but it would be the way forward if the intention is to have more teams and more privately owned racing teams in the sport. 

But that is the problem with F1 - they don't know what they are and what they want, and that actually goes for F1-fans as well. 

[Garndell]

I think they will try and sort out the financial mess in F1 before opening up for another team or 2.  It'll be easier to get new teams in with s fairer payment system in place and more likely for the likes of Audi to join in such a reformed sport/business.

[tormave]

So they would have rerun that test every time a setup change was made to the car, and if they wanted to run the car at a higher height then they would have to change to a softer suspension setting even if that is not optimum. Not entirely against the idea, but don't really agree with the method.

The car only needs to be legal in the qualifying and the race and they already have parc ferme in-between. So testing it once would suffice. I gave that only as an example of regulation, which would make zillion-plane front wings obsolete without having to ban them. I'm sure Brawn has better ideas.

[LuckyStrike1]

I think they will try and sort out the financial mess in F1 before opening up for another team or 2.  It'll be easier to get new teams in with s fairer payment system in place and more likely for the likes of Audi to join in such a reformed sport/business.

 

It's already open, hasn't been closed.

[Clatter]

The car only needs to be legal in the qualifying and the race and they already have parc ferme in-between. So testing it once would suffice. I gave that only as an example of regulation, which would make zillion-plane front wings obsolete without having to ban them. I'm sure Brawn has better ideas.

I think the car has to be legal at all times during an event.

[PayasYouRace]

I think the car has to be legal at all times during an event.

 

We cleared that one up in the FISA/FOCA days.

[Lee Nicolle]

I've said no not because I don't think they'll try to get new teams, but because Ross Brawn is in charge.

Rather than immediately try to replace the team he'll try to get costs down to a point where a new team can survive on a realistic budget (i.e. one pay driver and foolish millionaire owner). Then see who comes knocking.

By the end of this year I think we'll see some of the cost savings in place, early next year teams will start serious planning and by 2019 we'll see some new teams.

Foolish BILLIONAIRE owner. A million is pocket change!

[senna da silva]

No, clearly America is not interested in "foreign investment"!

Edited by senna da silva, 29 January 2017 - 06:16.

[FPV GTHO]

The current payment system doesn't support more than 10 teams. Even after you fix that, arguably there's still not enough sponsors in the sport if you want the teams to survive on more than FOM money. Even the bigger teams are having money come in from shareholders etc to keep them ahead.

[loki]

The current payment system doesn't support more than 10 teams. Even after you fix that, arguably there's still not enough sponsors in the sport if you want the teams to survive on more than FOM money. Even the bigger teams are having money come in from shareholders etc to keep them ahead.

It would have to be someone like Haas where they own the sponsor and have the money to compete even without the purse.

Edited by loki, 29 January 2017 - 18:32.

[Nathan]

I think they will try and sort out the financial mess in F1 before opening up for another team or 2.  It'll be easier to get new teams in with s fairer payment system in place and more likely for the likes of Audi to join in such a reformed sport/business.

 

It's a spending mess, not a financial mess..

[Garndell]

It's a spending mess, not a financial mess..

 

The extra payments to some teams & the allocation of funds to the lower teams do make a financial mess.  Spending is out of control but it can be alleviated, even just a little by a more equitable distribution of funds.

[pdac]

The extra payments to some teams & the allocation of funds to the lower teams do make a financial mess.  Spending is out of control but it can be alleviated, even just a little by a more equitable distribution of funds.

 

I'd say that unless the distribution of funds is 100% equal (i.e. every team gets the same) then it won't solve the out-of-control spending. I do, however, feel that equal distribution could (because winning or improving your position in the WDC would be about glory and trophies and not about keeping your business afloat).

[Augurk]

Completely equal distribution would be terrible, imo. There has to be a prize fund that encourages to at least put in the effort. I think every team should get the same base amount, but there still should be a hefty prize fund. Furthermore I don't think the base amount should be enough to keep the team afloat. That way it's just: get your foot in the door, minimize spending, and you've got a "free" (self-supporting) advertising vehicle driving around at the back. There should be incentive. 

[Rinehart]

Question say's it all.

Its going to take until 2020 to get a new commercial and participation model in play and only then can an attractive tender for new teams be viable. 

[LuckyStrike1]

The extra payments to some teams & the allocation of funds to the lower teams do make a financial mess.  Spending is out of control but it can be alleviated, even just a little by a more equitable distribution of funds.

 

That is one solution but not the only solution. 

 

It is not a totally unrealistic prospect that Mercedes, Ferrari, Red Bull and McLaren won't accept a cut in their revenue either during their current contract term or at the end of the contract term. They have a nice stream of revenue from the sport now, so to get them to cut it down is a tall order. 

So what do you do then? Take money out of Liberty's share and distribute amongst the midfield teams leaving owners with less revenue? Generate more income for the sport sounds nice, so everyone get's more but that doesn't solve the unequal distribution of the money. Everyone will get a little bit more but there will still be a uneven distribution and the smaller teams will still struggle - or be more uncompetitive and thus struggle. 

 

So what do you do if the four top teams won't accept a cut in their revenue? That's the big question. 

[Anderis]

Completely equal distribution would be terrible, imo. There has to be a prize fund that encourages to at least put in the effort. I think every team should get the same base amount, but there still should be a hefty prize fund. Furthermore I don't think the base amount should be enough to keep the team afloat. That way it's just: get your foot in the door, minimize spending, and you've got a "free" (self-supporting) advertising vehicle driving around at the back. There should be incentive. 

I kind of agree. i have been saying for years that disproportion in prize money that big and small teams receive is way too big. But that doesn't mean first and last team  in WCC should receive exactly the same.

 

The worst thing is that some teams receive some arbitrarily fixed payments which make them receiving more money even in case of finishing last than the other team would get for finishing first. The two most desired changes for me would be:

- The prize money structure allowing small teams to build and keep their competitiveness in long term, making them potentially a big team in the future. Now it's impossible, because even if let's say, Force India would finish 3 or 4 years in row ahead of Ferrari, Ferrari would still be receiving something like €80m more per year on prize money alone due to their huge bonus that is not results-related. So they'll keep outspending Force India, making a long-term competitiveness switch almost impossible, which is very bad from sporting point of view.

- The team finishing last in WCC should still receive enough money for survival, even if there are more than 10 teams. I would say the last should get at least 50% of what first is getting, including all possible bonuses for first. The difference between first and last would still be quite significant, but you could realistically make your way up the grid over years.

[BRG]

 

So what do you do if the four top teams won't accept a cut in their revenue? That's the big question. 

Tell them to p!ss off.  

Where would they go with their massive factories and wind tunnels, huge workforces, and massive physical and intellectual inventory which would all become redundant overnight?  Liberty has them over a barrel if they chose to play hard ball and the people who run the top teams must know that.  They aren't fools.  They will kick and scream but in the end they will have to accept reality.

[johnmhinds]

That is one solution but not the only solution. 

 

It is not a totally unrealistic prospect that Mercedes, Ferrari, Red Bull and McLaren won't accept a cut in their revenue either during their current contract term or at the end of the contract term. They have a nice stream of revenue from the sport now, so to get them to cut it down is a tall order. 

So what do you do then? Take money out of Liberty's share and distribute amongst the midfield teams leaving owners with less revenue? Generate more income for the sport sounds nice, so everyone get's more but that doesn't solve the unequal distribution of the money. Everyone will get a little bit more but there will still be a uneven distribution and the smaller teams will still struggle - or be more uncompetitive and thus struggle. 

 

So what do you do if the four top teams won't accept a cut in their revenue? That's the big question. 

 

I don't think anybody is expecting that to happen, the redistribution of money can't realistically happen until the end of 2020 when the current Concorde Agreement runs out.

 

Any talk about it right now is just political manoeuvring to let the teams know what to expect from Liberty Media going into the future.

[Clatter]

Tell them to p!ss off.
Where would they go with their massive factories and wind tunnels, huge workforces, and massive physical and intellectual inventory which would all become redundant overnight? Liberty has them over a barrel if they chose to play hard ball and the people who run the top teams must know that. They aren't fools. They will kick and scream but in the end they will have to accept reality.

What does Liberty have if the teams called their bluff? Would the crowds come to the races if all that's left is the back of the grid.?