Rising costs hurt smaller F1 teams

Singapore: Formula One team bosses say the rapidly escalating costs of the sport — set to climb even higher next season — mean there is something “fundamentally wrong” with the sport which must be corrected.

The switch to V6 turbo engines next season, along with the re-introduction of in-season testing, means already financially-stretched teams will face a significant increase in costs.

Talks between teams to agree on cost-reduction methods have collapsed without any agreement, failing to bridge the gap between the smaller teams and the big four of Red Bull, Ferrari, McLaren and Mercedes, who were resistant to any restrictions.

“When I came into Formula One, people talked to me about cost coming down, but I don’t think there’s been a single year it’s come down,” Caterham team founder and Air Asia chief Tony Fernandes said. “Next year will be the highest year, so there’s something fundamentally wrong.

“The teams lost out an opportunity to get costs under control. Self-interest overrode the sport and we are as much to blame for this problem as a [new] engine. We screwed it up. It’s as simple as that.”

Cost-saving measure
Toro Rosso team principal Franz Tost voted against the reintroduction of in-season testing, which was originally axed as a cost-saving measure but brought back in 2014 at the behest of the big teams.

“The teams are stupid enough to do tests during the season,” Tost said. “On the one had they’re complaining they don’t have money, on the other hand they throw it through the window.

“And who wants the tests? The rich teams. As usual.”

Lotus team principal Eric Boullier said costs had come down significantly since the manufacturer era of last decade when the likes of Renault, BMW, Toyota and Honda had their own teams. However he still urged more talks between teams, governing body FIA and the commercial rights holder headed by Bernie Ecclestone, to stabilise regulations to reduce compliance costs.

Bob Fearnley, deputy principal of Force India, agreed regulation needs to be imposed from the top as there is too much competition between the teams for them to ever reach an agreement.

“The teams have demonstrated that they are not capable of being able to agree a cost control, so the answer is to take it outside of the teams’ control. It’s up to the FIA to decide a formula, bring that in and implement it.”

Re-negotiate
Aside from cost reduction, another means of sustaining the teams is for more of the money earned by the commercial rights holder to be passed on to the teams.

“We may have missed an opportunity to just sit down with the commercial rights holder and re-negotiate something which could have been more in favour of the teams, but we failed,” Boullier said.

Tost said getting more money flowing from TV rights and sponsorships to funnel down to the teams was not the answer.

“It’s easy to say we should get more money, but give the engineers one million and they ask for two. Give them four million and they ask for eight.”

Boullier agreed, saying increased revenue must work in concert with tighter regulations to control spending.

“The more money you get, the more money we will spend if you don’t have any safeguards around you,” Boullier said. “The more open the regulations are, the more we will spend money and waste money.”


Archive