There are reports that the Formula 1 teams have agreed to widespread job losses throughout the industry. The only good news is that with three new teams joining the World Championship in 2010, some of those who will be laid off will be able to find work elsewhere. Other big organisations, such as McLaren and Ferrari, may be able to transfer F1 workers to other departments or subsidiary businesses. Some teams may create new businesses in order to move staff out of the F1 business. One example of this would be a team windtunnel that can no longer be used because of the cost cuts. This would open up as an independent business and thus soak up some of the people being dropped by the team. The aerodynamic testing work would be available for customers outside F1 and indeed even outside the sport. One of the former Honda Racing F1 windtunnels is already being used in this way with work going on to help cycling teams improve the aerodynamic efficiency of the riders.
The number of staff allowed in each team is rumoured to be reducing to a maximum of 350 next year, with a further drop to 280 in 2011. Apparently this will largely depend on whether or not the team is buying in parts from external suppliers. However as the budgets are coming down dramatically the teams will be negotiating for better deals from suppliers and so they will be under pressure to reduce their prices in order to survive.
Most teams have already been cutting back on staff this year with test teams being laid off and aerodynamic development teams also being cut back significantly but as some of the teams started the year with more than 650 employees, it is going to be a painful business. There will be some jobs created by Manor F1, Campos and USF1 and there may be a few jobs going as well at Scuderia Toro Rosso, which has to become a manufacturer in its own right again in 2010, but these jobs are geographically spread around with USF1 recruiting in the United States and Campos in Spain. Manor and its technical partner Wirth Research is best-placed to pick up good people at its headquarters in Bicester.
Is this a FOTA agreement?
Any rumours on Williams, Force India and the new three teams joining or (re-joining) the FOTA fold?
It brings the recession home to the industry all right. It also puts the drivers’ multi-million pound pay packets into perspective. Has there been any background deal on putting a cap on these?
With so many people losing their livelihoods, the story that Ferrari are planning to pay Kimi Raikkonen £12.5m NOT to drive for them next year leaves a very foul taste in the mouth. Although, now that I think about it, aren’t Ferrari driver salaries still paid by Marlboro? So there’d be a bad taste anyway.
I hate this enforced cost-cutting mania.
[...] A bad time to be in Formula 1 « Joe Saward’s Grand Prix Blog The number of staff allowed in each team is rumoured to be reducing to a maximum of 350 next year, with a further drop to 280 in 2011. Apparently this will largely depend on whether or not the team is buying in parts from external suppliers. (tags: F1, Wirtschaft) [...]
[...] A bad time to be in Formula 1 – Joe Saward’s Grand Prix Blog "The number of staff allowed in each team is rumoured to be reducing to a maximum of 350 next year, with a further drop to 280 in 2011. Apparently this will largely depend on whether or not the team is buying in parts from external suppliers… [...]
Laying people off is not only a painful business, but very often very expensive, too.
I do not know much about labour laws in Switzerland, but that might be another big disincentive for buying a BWM Sauber team, having to lay off long standing staff members and in consequence a reason why BMW pulled the plug so spectacularly. It is bad PR, too, to lay off people.
Formual1 is alway moving into new markets, new race courses that can afford the ever rising fees, at the same time the teams have to lay off people. That means some very rich people get even richer, whereras others loose their livelihood. This really is a rather Victorian version of a market economy, and I always thought we have long moved on from theses times, but alas, it seems, this is not the case.
[...] A bad time to be in Formula 1 [...]