440 replies to this topic

[taran]

Grid penalties perhaps.

 

Doesn't really work. Take Hamilton in the 2021 Mercedes as an example.

He was hit with a 10 second penalty after ramming Verstappen off the track in Silverstone and still had the speed to fight his way to first. Or Hamilton in Brazil. In a two part race, he had the speed to climb from last to first.

 

If a team think they can get a rocketship if they overspend, grid penalties won't be a deterrent.

 

[taran]

The obvious solution is for bloated teams to shed staff to get more grip on their budgets. They went from 300 to around 1,000 and can just as easily go back to a much lower headcount. They just don't want to and cover behind loyalty to the staff.

 

The big teams had enough warning to know numbers had to go down considerably but they didn't want to give that embedded advantage so we got some window dressing with a few sacked and others moved around to other projects but still available if necessary.....

 

And now it is becoming clear that bloated personnel numbers means less money for upgrades. Midfield teams have between 400 and 600 staff so they have more money for upgrades and can stay within the cap but their upgrades take more time because less people to produce them but that is the pay-off.

 

Hence Horner and Binotto's whining. They want their cake and eat it too.

[pdac]

Williams have been fined for not submitting their accounts

 

https://www.bbc.co.u...rmula1/61726721

 

 

Williams have been fined $25,000 (£20,000) for a breach of Formula 1's cost cap regulations.

The team missed the 31 March 2022 deadline to submit its 2021 accounts and are the first to be punished under the cap since its introduction last year.

 

 

[cbo]

Doesn't really work. Take Hamilton in the 2021 Mercedes as an example.
He was hit with a 10 second penalty after ramming Verstappen off the track in Silverstone and still had the speed to fight his way to first. Or Hamilton in Brazil. In a two part race, he had the speed to climb from last to first.

If a team think they can get a rocketship if they overspend, grid penalties won't be a deterrent.

Failure to meet the budget cap means that you have effectively cheated your way to your results. So you should loose all WDC and WCC points.

And pay a fine of, say, 10 times your overspend.

The fine will disourage teams with few points from overspending and the loss of points disourage the big teams.

[JimmyClark]

Williams have been fined for not submitting their accounts

https://www.bbc.co.u...rmula1/61726721

Where does this money go?

[pdac]

Where does this money go?

 

There are not that many ways that the FIA make money. Here's another innovative idea.

[pdac]

The quote from Otmar Szafnauer says it all:

 

Most teams do their budgets in November, December timeframe, for the following year and we are no different. And at that time, inflation was already at 7+%. RPI in England was 7.1, 7.2%.

 

We took that into consideration when we did our budgets and laid out all the development work that we were going to do. And we're still within it, even though freight was a little bit more expensive than we thought. And we plan to be there at the end of the year. And we'll adjust the development accordingly.

 

 

[BoDarvelle]

 

The quote from Otmar Szafnauer says it all:

 

 

 

 

Steiner also pointed out the the teams are paid in dollars, which has gone up. Offsetting a good chunk of the inflation the big 3 are screaming about.

 

Sorry guys. 900 employees doesn't work anymore. Which is the point of the budget cap.

 

*If they were to let new teams in, which FIA claims are lined up beating on the door, those laid off employees would have teams to go to.

[Mohican]

If it is correct that Alpine and Alfa Romeo (and Williams ?) oppose an increase, then all power to them.

The whole thing just shows the cap working as intended; Horner and Binotto are not good enough managers.
Full stop.

[cjm321190]

Alfa Romeo design a lighter car which is a valid design path. Big teams cry and weight is increased. Williams will be way under the cap yet big teams cannot male it.

If they are forced and no more updates then the back teams will catch up a little.

Big teams and manufacturers are used to ramping up the costs to out spend the independents.

[GentlemanDriver091]

Williams will be way under the cap yet big teams cannot male it.

Big teams and manufacturers are used to ramping up the costs to out spend the independents.

That’s a bit too simplistic: The bigger teams used to spend over 400 million, Williams only spent 110 million in 2020.

With the budget cap smaller teams didn’t had to change anything regarding their budget, where the top 3 had to save up to 300 million per year.

[pdac]

That’s a bit too simplistic: The bigger teams used to spend over 400 million, Williams only spent 110 million in 2020.

With the budget cap smaller teams didn’t had to change anything regarding their budget, where the top 3 had to save up to 300 million per year.

 

Why is it too simplistic. We're living in 2022 now, not 2020. It's not like the budget cap suddenly appeared. Everyone had plenty of time to adjust to it before it came into force. The blunt truth is that some teams did not want to adjust or were worried that their direct rivals would not adjust and so chose not to adjust themselves.

[Beamer]

That’s a bit too simplistic: The bigger teams used to spend over 400 million, Williams only spent 110 million in 2020.

With the budget cap smaller teams didn’t had to change anything regarding their budget, where the top 3 had to save up to 300 million per year.

Which just shows the cap might just work if enforced correctly and we'd see the field closing toward the end of the season.

[GentlemanDriver091]

Why is it too simplistic. We're living in 2022 now, not 2020. It's not like the budget cap suddenly appeared. Everyone had plenty of time to adjust to it before it came into force. The blunt truth is that some teams did not want to adjust or were worried that their direct rivals would not adjust and so chose not to adjust themselves.

Because you’re comparing Williams with the top teams. A team which is used to run its organization for a budget of 110m and teams who are running an organization based on a budget of over 400m.

Williams doesn’t have to adapt to the budget cap, the top teams do and that isn’t a easy task considering what they used to spend.

They are probably all on the limit of what can be spent within the budget cap and inflation made it even worse.

Maybe the could save on their development budget, but that is probably about 7-10% of their total budget, if we can believe the estimates of the media, and that won’t be enough considering the inflation rates they have to deal with.

Travel, staff costs, energy, telecom, engine fees, property costs, materials to build the cars are all pretty much fixed costs where savings aren’t possible during a season. In fact much of those costs (f.e. energy, traveling and materials) increased during the season.

[pdac]

Because you’re comparing Williams with the top teams. A team which is used to run its organization for a budget of 110m and teams who are running an organization based on a budget of over 400m.

Williams doesn’t have to adapt to the budget cap, the top teams do and that isn’t a easy task considering what they used to spend.

They are probably all on the limit of what can be spent within the budget cap and inflation made it even worse.

Maybe the could save on their development budget, but that is probably about 7-10% of their total budget, if we can believe the estimates of the media, and that won’t be enough considering the inflation rates they have to deal with.

Travel, staff costs, energy, telecom, engine fees, property costs, materials to build the cars are all pretty much fixed costs where savings aren’t possible during a season. In fact much of those costs (f.e. energy, traveling and materials) increased during the season.

 

No I'm comparing one F1 team with another F1 team. This is not a multi-tier series. There's no such thing as a top team. All there is are teams that have more money available to them than other teams. That has nothing to do with the budget cap.

[BoDarvelle]

No I'm comparing one F1 team with another F1 team. This is not a multi-tier series. There's no such thing as a top team. All there is are teams that have more money available to them than other teams. That has nothing to do with the budget cap.

 

Yep. And as Williams/Haas/Alpine/Sauber show you can field a team while staying under the cap.

 

RB/Ferrari/Merc just don't want to. They like their advantage over the other teams and don't want to give it up.

 

Frankly, I find the fact that these teams have/had 800+ employees to put two cars on the grid 22 times a year ridiculous.

 

Work smarter versus just throwing money and manpower at a problem.

[GentlemanDriver091]

Yep. And as Williams/Haas/Alpine/Sauber show you can field a team while staying under the cap.

RB/Ferrari/Merc just don't want to. They like their advantage over the other teams and don't want to give it up.

Frankly, I find the fact that these teams have/had 800+ employees to put two cars on the grid 22 times a year ridiculous.

Work smarter versus just throwing money and manpower at a problem.

Another one: https://www.autospor...-2022/10320058/

And Seidl confirms my point I was trying to make:

"For us as a team that was planned to run at the cap at the beginning of the year, with all these unexpected costs that came up, we are at a position where we can't make the cap anymore, because you simply have certain fixed costs in order to start the season," he said when asked by Autosport if the team could still stay inside the cap.

"You have fixed costs with the resources which you have in place, the personnel and so on, which you can't adjust anymore.

"And with this unexpected huge increase of costs, mainly on the freight side and utility bills, we're in the same position as some other teams that we can’t make the cap this year.

[pdac]

Another one: https://www.autospor...-2022/10320058/

And Seidl confirms my point I was trying to make:

"For us as a team that was planned to run at the cap at the beginning of the year, with all these unexpected costs that came up, we are at a position where we can't make the cap anymore, because you simply have certain fixed costs in order to start the season," he said when asked by Autosport if the team could still stay inside the cap.

"You have fixed costs with the resources which you have in place, the personnel and so on, which you can't adjust anymore.

"And with this unexpected huge increase of costs, mainly on the freight side and utility bills, we're in the same position as some other teams that we can’t make the cap this year.

 

All he is saying is that they are not prepared to compromise in order to make the cap - not that they cannot make it.

[GentlemanDriver091]

All he is saying is that they are not prepared to compromise in order to make the cap - not that they cannot make it.

No, that’s not what he’s saying:
"For us as a team that was planned to run at the cap at the beginning of the year, with all these unexpected costs that came up, we are at a position where we can't make the cap anymore, because you simply have certain fixed costs in order to start the season"

[BoDarvelle]

“We have $140million for 1000 people, with inflation, we haven’t even been able to pay the inflation. And I think the talk about [even a] $30-40million salary allowance is inadequate when you take that perspective.

 

Toto basically showing/saying that they had no intention of meeting the cap.

 

https://the-race.com/formula-1/wolff-f1-must-limit-driver-salaries-30m-inadequate/

[pdac]

No, that’s not what he’s saying:
"For us as a team that was planned to run at the cap at the beginning of the year, with all these unexpected costs that came up, we are at a position where we can't make the cap anymore, because you simply have certain fixed costs in order to start the season"

 

Yes, and why do you think that is? What do you think those unexpected costs overruns are? It's about not wanting to give up developing the car. It's about not wanting to cut back on the things they are used to spending on.

[GentlemanDriver091]

Yes, and why do you think that is? What do you think those unexpected costs overruns are? It's about not wanting to give up developing the car. It's about not wanting to cut back on the things they are used to spending on.

Inflation? Development costs are only 7-10% of their budget, if the inflation rate is >10% you’re basically screwed, it’s not so hard to understand.

It’s no coincidence that all teams that planned to spend the amount of money that was agreed under the budget cap are in trouble

[pdac]

Inflation? Development costs are only 7-10% of their budget, if the inflation rate is >10% you’re basically screwed, it’s not so hard to understand.

It’s no coincidence that all teams that planned to spend the amount of money that was agreed under the budget cap are in trouble

 

But staff costs, which is the biggest spend, are fixed - they are not rising at 10%.

[BoDarvelle]

And as Steiner has pointed out they use dollars for the cap while generally spending in pounds or euros. The dollar has gained a lot of value, offsetting much of the inflation.

[Muppetmad]

How, if it all, was this resolved? With energy prices in Britain (and elsewhere, of course) shooting up so dramatically right now, I imagine the cap must be posing a greater and greater challenge, even with a weakening pound.

[pdac]

How, if it all, was this resolved? With energy prices in Britain (and elsewhere, of course) shooting up so dramatically right now, I imagine the cap must be posing a greater and greater challenge, even with a weakening pound.

 

The easiest solution would be to just have zero changes for next season and continue with the same cars they have now.

[KWSN - DSM]

The easiest solution would be to just have zero changes for next season and continue with the same cars they have now.

 

I think Toto would have quite a conniption were that to happen.

[pdac]

I think Toto would have quite a conniption were that to happen.

 

I'm sure you are correct.

[ARTGP]

2 more races next year. Same budget cap?

[pdac]

2 more races next year. Same budget cap?

 

I hope so.

[Ali_G]

Williams going to be in a spot of bother this year.

Should it be up to the teams to build in crashed into their budget. The other option is to allow increases in certain cases such as where a car is completely destroyed. Ferrari could have fine with that last year after Sainz manhole cover crash.

Edited by Ali_G, 23 November 2024 - 10:59.

[Sterzo]

Williams going to be in a spot of bother this year.

Should it be up to the teams to build in crashed into their budget. The other option is to allow increases in certain cases such as where a car is completely destroyed. Ferrari could have fine with that last year after Sainz manhole cover crash.

They undoubtedly do. Allowing increases would open a can of worms. Crash your car and you get funding to copy another team's latest development when no-one else does (for example). And even if nothing went amiss, and nobody fiddled it, there's be a torrent of accusations and insinuations. Let's keep it simple.

[pdac]

Williams going to be in a spot of bother this year.

Should it be up to the teams to build in crashed into their budget. The other option is to allow increases in certain cases such as where a car is completely destroyed. Ferrari could have fine with that last year after Sainz manhole cover crash.

 

At the start of the season they know what they have left to spend. If they cannot make it to the end of the season without spending more, then that's just bad luck. Same as any other bad luck that besets a team or driver. One possible way that teams could avoid this is by reducing basic salaries and then, at the end of the season, using any left over budget to pay bonuses. If your driver trashes your car all of the time, then nobody gets a bonus.

[Clatter]

Williams going to be in a spot of bother this year.

Should it be up to the teams to build in crashed into their budget. The other option is to allow increases in certain cases such as where a car is completely destroyed. Ferrari could have fine with that last year after Sainz manhole cover crash.

I can see the argument for the Sainz case, as that was totally out of the teams control, but drivers trashing the car is something the team have to swallow. The interesting time will come if a team says they can't turn up due to lack of funds, but considering the number of big crashes that Williams have had this year, and they are still there, then the budget is managable.

[Stephane]

A few years ago, we wondered if Williams had enough budget to start with. Now, they may be a casualty of the budget cap. How the turntables.

[Anderis]

They undoubtedly do. Allowing increases would open a can of worms. Crash your car and you get funding to copy another team's latest development when no-one else does (for example).

Can't they set it up in such a way that the budget cap dispensation could only be spent on producing parts that were identical specification to the ones lost in the crash?

 

And maybe make the dispensation not 100% of all the parts' cost but something like 80%. Less risk for "tactical" crashes in order to be allowed to use less worn-out parts later on.

 

Just pondering, I'm not insisiting that it would be better than what we currently have.
 

[PitViperRacing]

Can't they set it up in such a way that the budget cap dispensation could only be spent on producing parts that were identical specification to the ones lost in the crash?

And maybe make the dispensation not 100% of all the parts' cost but something like 80%. Less risk for "tactical" crashes in order to be allowed to use less worn-out parts later on.

Just pondering, I'm not insisiting that it would be better than what we currently have.

Only issue is that if teams know that they'll get a financial top up for spare parts if they run out, they'll just allocate less money to spare parts and more to other areas like R&D

[Anderis]

Only issue is that if teams know that they'll get a financial top up for spare parts if they run out, they'll just allocate less money to spare parts and more to other areas like R&D

I don't have many issues with it. It'll effectively increase the budget cap by no more than a few percent and that's it. You can even decrease the cap by the amount the teams have spent on crash repairs on average per year thus far if you insist on keeping it on the same level as before. It's not an issue that generates any insolvable problems.

[PitViperRacing]

I don't have many issues with it. It'll effectively increase the budget cap by no more than a few percent and that's it. You can even decrease the cap by the amount the teams have spent on crash repairs on average per year thus far if you insist on keeping it on the same level as before. It's not an issue that generates any insolvable problems.

I just think it's too open for teams gaming the system that's all.

[Anderis]

I just think it's too open for teams gaming the system that's all.

Many people said the same about the entire idea of the budget cap. I don't see how it exactly could be gamed with the restrictions that I provided, do you?

[Sterzo]

Just pondering, I'm not insisiting that it would be better than what we currently have.
 

I think that's a necessary prerequisite to any change made. i.e. state clearly what significant problem exists currently. If there's not a clear-cut necessity to change, it's a mistake to tinker and potentially create further problems.