I was told a couple of months ago to watch out for Porsche signing up Formula 1 people for its LMP1 programme, but it was made very clear to me at the time that I should not read too much into the stories and that Formula 1 remains a no-go area for companies in the Volkswagen group, at least for the moment. It is never really explain why this would be the case and the conclusion that one must draw is that company uber-boss Ferdinand Piech is not very keen on the idea. And no-one would dare to go against what the 75-year-old wants. That does not mean that a team put together now to build sports cars might not at a later date turn its attention to F1 when the political scene has changed, but that cannot be considered a concrete plan.
Porsche has always been a sporty company, and has had occasional forays into F1 when the circumstances seemed right, but the firm has generally concentrated its efforts in sports cars. These days it is run by Matthias Muller, an Audi man who began his career as a toolmaker with the company back in 1977. A protégé of Martin Winterkorn, Muller rose through the ranks to take his present job two years ago.
His head of research and development is a more interesting figure in motorsport terms. Wolfgang Hatz is a racing man. He began his career as a project manager at BMW Motorsport back in 1983, when the company was involved as an engine supplier in F1. He left the firm in 1989, moving to Porsche, where he was a member of the team that built the disastrous V12 F1 engine, used briefly in that era by the Arrows team. After that he had a spell as technical director of Opel Motorsport before moving to Fiat as head of engine development before joining Volkswagen in 2001. The men who have been hired in the course of the last year for the LMP1 project include a number of F1 names, notably the head of the entire project Fritz Enzinger, who was previously head of the BMW F1 operations, after a career in BMW Motorsport in Munich that dated back to the 1990s. The head of the LMP1 development programme will be Alex Hitzinger, who started his career with Toyota, being one of the designers on the sports car engines before moving on to be part of the F1 team. He was then lured to Cosworth where he initially ran the Ford WRC programme before becoming head of F1 engine development. He was then taken on by Red Bull Technology to run the F1 development for both Red Bull Racing and Scuderia Toro Rosso, but that was short-lived because it was decided that teams must build their own equipment and so he became the Technical Director of the Scuderia Toro Rosso for a year. Another recruit is former BMW race engineer Mike Krack, who will move at the end of the season, handing over his role in DTM to Australian Chris Dyer, formerly at Ferrari. It seems that another man on the move will be Sauber chief mechanic Urs Karatle, who began work with Sauber in 1989 and spent 10 years with the team before taking a year out to become a helicopter pilot, before returning to Sauber in 2010.
It is really impossible to say whether there is any longterm F1 plan at Porsche, but what is clearly true is that the company wants to make sure that it is competitive when it wades into LMP1. If that programme is a success and obstacles to F1 are removed then who knows? But I would not bet my house on it.
I really do not believe F1 is a good place to go these days. Too much money involved and too little benefits unless it fights for the title, which is a looong way to go for any manufacturer.
LMP1 in WEC on the other hand is a very convenient place to be. They have their sister-company, Audi, with tremendous know-how on the current cars, Porsche has an unbeatable history in sportscar racing. It’s more team-oriented, rather than driver-centered, so its even better for their PR (who gives a rat’s buttocks on the Constructors’ Championship in F1?)… And for Pete’s sake: WEC is a World Championship.
In other words: there’s no reason for them to go to F1. I can see them maybe thinking about building an F1 engine, but no more.
This is all very well, but then you look at the viewing figures and everything else disappears without trace. End of story.
But like I said: unless they fight for the title, they are just also rans. I don’t know e.g. how much Toyota or Honda benefited from F1 while they were there in the last decade.
This is very true, and they do say that all publicity is good publicity don’t they? But then again is it really good for Mercedes Benz sales for millions of people to watch Michael Schumacher trailing behind Toro Rossos and Force Indias? The marketing men must cringe and wish the cameras would show someone else.
Porsche surely has a lot more to lose than to gain from entering F1. Ferrari has always been more F1-oriented, while Porsche has always been more endurance-oriented. Could that be one of the reasons why Porsche has always sold more cars?
porsche sells more cars because they are cheaper and more people can afford to buy one. it’s a different market they deliver to, especially since they began building the cayenne.
If you look at Porsche’s Le Mans/sports car business in the past, it is not built soley on a factory team effort. It is always run on the basis of a substantial customer base to share the costs of development and at best to minimise a loss/make a profit. The GT3 program is the best contemporary example, which has massive support round the world. I’m guessing the LMP1 program is designed to give wealthy individuals/professional teams an opportunity to step up from the GT3 series. The factory may have a small team, but there would also be a number of other teams in which to share the cost/sell parts/make money.
In addition, Porsche are about launch their new super car in 2014. This is coincidentally the same year they plan to return to Le Mans. Hence the new supercar (in order to improve marketing) would be linked to the LMP1 effort – ie a road version of the race car. Not as crazy as a 962 for the road, but something like the road version of the GT3 Cup car.
I think Le Mans is one of the most undervalued motorsport properties. It has a history that rivals F1 for prestige, but in the past ~20 years it has shrank where F1 has grown significantly. With the increased profile in the sport created by Audi (particularly in the US where they have used it to promote their Tdi brand), Porsche probably see it as a lower cost (see earlier point re development sharing) option with good marketing possibilities.
I’m a big fan of motor racing, but I couldn’t even tell you who raced at le mans this year. Peugeot and Audi I think, maybe? The publicity is just not there.
No offense, but… are you sure you’re such a big fan of motor racing then? ) (it was Audi and Toyota BTW)
But to turn this into something else: the manufacturers you listed were winners at Le Mans. Sure, everyone knows Merc is in F1. Oh, btw, Michael “Ready to Retire” Schumacher drives one…
And what do you remember of Honda from their final years? Mostly the part they had the Earth as their paintscheme and never got into Q1. Oh, and Rubens “Never Ever Want To Retire” Barrichello drove one. ROTFL
Would that REALLY worth for Porsche? Pour masses of money into something that would most likely turn out like this?
Believe me. it would be a lot easier for them to win at Le Mans again rather than investing basically billions into F1 to get a vague “something”.
..and at least you’d remember Porsche won Le Mans, not that they were struggling in the mid-back field in front of empty Chinese grandstands.
That is the real difference.
Porsche may not go into F1, but Audi might as an engine supplier – just not necessarily in 2014.
Spot on Joe. To be honest I fail to see the payback for automotive OEMs if they go down a path other than F1. How much it has cost Audi to effectively buy Le Mans I do not know but does it represent a good RoI?
£ for £ F1 is the most cost effective way of getting your brand recognised through motor sport … Le.Mans had an average UK audience of 49k this year, (and that was up on last year), it just doesn’t make economic sense to race anywhere else other than F1, but it does make ‘political business’ sense, if you want to be a big fish in a very small pond.
No doubt if your brand is whiskey or shampoo but with a greater distance than the entire F1 season and a superior top speed Le Mans is where manufacturers will choose to showcase what they can do in a motorsport context and where true innovation with a relevance to road cars is on display.
A lot of ageing people are watching the oft called pinnacle of motorsport as it slips further and further from relevance with a grid that can barely sustain itself.
Demographics show that Le Mans attracts a far older audience than F1.
Taking the average F1 race viewing figures, and being generous to Le Mans, Le Mans gets only 1.3% of the viewers that F1 attracts, and that’s using only average F1 figures from matching territories, now taking the average cost to run an F1 team for a season, Porsche (for example) would only get the same ‘bang for their buck’ from circulating at Le mans, if they spent no more than £882,500 for their entire Le Mans effort.
The main reason some manufacturers prefer to compete at Le Mans, is because they can be a bigger fish in a tiny pond, and company directors can win something, but winning against a field that contains little sports cars often driven by amateurs, pop stars, film stars etc means nothing to the general public, that’s why the viewing figures are so dreadfully low. It’s a bit like watching pro-am golf with Jimmy Tarbuck.
Karen, that’s like comparing me trading size in third order options on futures in a fast tape high VIX market, and taking a modest equity stake in a company that muddles along and pays divvies.
One is leveraged to the hilt, and will or can swing violently, the other, well, I may own my underpants (or at least not need to throw them away) at the end of the day.
Bit not quite there referencing pop stars, also, eh?
I would have got Les Dawson to play F1 Golf with. More common sense . .
More seriously, few suss externalities costs better than Bernie: put the long term income risk on local states, fill the gaps with a grab on other incomes, lay off long term debt against expectation bounced high by temporary highs in the market he’s not directly managing. If that’s not a complex derivative, I don’t know what it is. (and for reference, equity is not equity, it of itself is modelled as a derivative, being simply a call on expectations) .
My concern is that online advertising, created like QEternity, is simply a false expansion that has crippled long term prices in the market. That will filter through. The assumptions FOM and many other have made will be invalid before very long. I am expecting, planning for a >40% headline correction in global ad and sponsor spend inside 2 years. I don’t think that will do enough to save the believed inherent values buyers wish they attain.
Karen – always interested in your posts.
Viewing Le Mans is difficult. I remember the difficulty trying to watch it even whilst in France! However, from a marketing perspective, there is more than just eyeballs watching screens.
Audi have used their Le Mans wins brilliantly. When you can’t get decent coverage, create your own! They commissioned a documentary from the same award winning company that films the NFL. This has been watched by millions. It is eye opening to see the growth in diesel in the US, almost entirely through the marketing of the VW/Audi Group (who are the largest seller of diesel passenger vehicles). Contrast this to the reputation of Audi 10 years ago in the US. They have used diesel – and the Le Mans diesel wins – to convince Americans to buy their products.
Could an F1 team (eg RBR) do the same thing about their title win? Probably not as the FOM owns the footage. However, this could be a great thing for the sport to consider doing themselves as a way to promote the sport over the quiet in-between seasons period. Feel free to pay me a percentage of the revenues for the suggestion. Bernard has my number.
You really are a dreamer.
Very difficult to call for the long-term, Porsche are canny folks and Ferdinand Piech has just been around too long to get drawn into a losing situation.
Personally I can’t see that Porsche ‘needs’ to get into F1, there’s a big downside in costs, and with VW looking to complete the Porsche takeover, control will pass to VW anyway. They have a good customer base for their cars without needing to advertise more.
Car manufacturers lose enough money now without throwing even more into the bottomless pit that is F1 today.
Wouldn’t the fact Cosworth are now up for sale http:/wp.me/p2HWOP-cI be a good opportunity for Porsche? They were pretty sucessful with the TAG engines for McLaren winning 5 titles.
I think I read Cosworth have done the R&D and drawings for the V6 2014 engines but need cash to develop further. They recently cancelled a proposed float that was designed to raise cash and this may be the alternative.
That cancelled ‘float’, is now on…
Maybe ESPN wong then http://en.espnf1.com/f1/motorsport/story/92182.html. They say float cancelled and a trade sale being sought.
Might be a good time. ZIRP means equities pumped to max. Impending likelihood of big inflation means debts wiped, assets grow.
Like Williams, I’d look at what Cosworth sell and not the F1 angle.
I’ve made two expensive wrong calls on inflation in the last four years, expensive mainly because I don’t have a big enough personal portfolio to go liquid quickly when I need to. (I.e. buy cash at market) Guys like John Paulson, who can move rapidly and not miss other things, have however been very consistent on big inflation growth.
But, agree with JV, “float” thoroughly deserves the inverted commas. Basically, all we get is the scraps left over from private placements. I’m amazed (splutter) how they bend the definition so far . .
Reason PE is taking up equities like this, is because PE is so many huge outfits who can still issue debt. See any small companies tapping the debt markets lately?
Hi Joe, I am surprised that Chris Dyer is in DTM now. I would have thought that another F1 team would have snapped him up after Ferrari.
Is he contractually obliged to be out of F1 for a period for some reason?
Cheers
Julian F
No, I doubt that. He has been out of F1 for a while and any contract obligation is unlikely to be more than six months.
Not really that surprising he is back in touring cars given he had previously worked for TWR/HRT back in the 90′s with brock and lowndes before he went to F1. Although I guessed he would probably head back to Australia and be instantly snapped up by a V8SC team.
True.
Karen may not agree, but F1(tm) is not the be all and then end all for the true motorsport person. Often F1 is less satisfying to work in than “smaller ponds”. Ask Gordon Murray, or Malcolm Oastler.
It’s bit like the fact that there a huge number of arthouse film directors who would rather shoot themselves than emulate (say) Michael Bay.
F1 tm is silly. TM means trademark applied for not granted. It is rubbish. The trademark has been denied.
At this point the concept of “taking the mickey out of FOM” should be considered, Joe…;-)
Technically, trademark asserted in common law, rather than applied for. It’s a claim, not a status indicator like Pat.Pen.
They are using ™ in the hope that people who do not know any better will mistake it for ® and ©, which is what they would really like to have, but have no rights to.
Very likely. If I could bottle up sheer stupidity and arrogance into a book, I’d have the killer reference to “how to be a novice company director”!
That may may be so but 95% of the F1 viewing audience are never likely to be able to buy a Porsche – I would suggest a much higher percentage of the LeMans (because that is what it is all about ) and WEC audience are in the right demographic position. Manufacturers are moving away from the over indulgent image of Bernie’s circus as it doesn’t fit their profile anymore.
A higher percentage of 0 is still 0…
And whereever manufacturers are going instead of F1, it’s definitely not to WEC – I’ve just gone to see who raced in it this year, Audi and Toyota, that’s it.
http://en.wikipedia.org/wiki/2012_FIA_World_Endurance_Championship_season#Manufacturers.27_World_Championship
There is far more to sportscar racing than WEC and far more to motorsport than F1, Ewan.
Go back into history and take a look at the most iconic cars in history – D Type, DBR1, 250 GTO, GT40, 911, Testarossa, 917, 956 …. the legacy of winning and competing at Le Mans lasts generations … in F1 they remember the drivers more than the cars.
As for the number of manufacturers ….LeMans is more than just LMP1 in GT there is Corvette, Ferrari, Porsche, Dodge, Lamborghini. Nissan & Honda are heavily involved in P2 – and where do you get 0 from for the viewing figures? 250,000 people attend Le Mans every year – that is more than any single F1 race and 60,000 of them come from the UK.
OK F1′s audience is huge but the image F1 creates is just not politically correct for manufacturers any more as I said it is far too self indulgent.
Le Mans racing provides relevance for the manufacturers in the use of hybrid, diesel, alternative fuels etc which whilst the direct TV audience may not be as large its use in their marketing is massive.
I mention Le Mans because that is the relevance for the manufacturers – not the WEC.. yet. 2012 is the very first year of the WEC.
Bernie is well aware of the potential threat of sportscar racing to F1 as he has through his old cronies at the FIA changed the rules to reduce its impact – the demise of group C racing being the prime example.
Y’think? Look again, because I see works teams for Audi, Toyota, Aston Martin and Ferrari, alongside customer efforts from Lotus, Nissan, HPD, Porsche and Chevrolet.
Hardly terrible. Endurance racing does tend to have a rather different audience compared to F1, mind you.
The difference is, if you win Le Mans you have to spend another fortune telling the world you did it. If you win F1, they already know.
My take:
* McLaren will buy Cosworth to design & build their road car engines and design for future ones.
* Porsche will join F1 after a couple of years of F1 running a budget cap to see if it works and if teams stick to it.
I can’t see why McLaren would want to buy Cosworth, they already design and build the MP4-12C car engine, albeit with external manufacture of some/most parts, and I don’t see Cosworth as being a volume producer.
When you think of racing and porsche you generally tend to think of porsche at Le Mans or one of their various 911/gt championships/cars. Whilst the all the WEC combined (bar Le Mans) doesn’t have the same draw as a single F1 weekend, Le Mans is a pretty big event. Steve Mcqueen in a porsche at le mans is still an Iconic image that is still used today. Given that they haven’t been in the top category at Le mans for a while this mystic is probably starting to wear a little thin, hence they need to go back to refresh everyone’s memory.
”
When you think of racing and porsche you generally tend to think of porsche at Le Mans or one of their various 911/gt championships/cars.
”
Not really. I’ll think of Porsche in Rallying back in the day with the various 911 generations and Paris-Dakar with the 959.
And after that, yes the 911 GT3 cars.
Would that suggest Porsche should join the WRC or Dakar?
(Please can we have a minute’s silence to mark the demise of the WRC and the Dakar)
Which manufacturers are planning to be taking part in the WRC in 2014? VW and errrm….
Ford have withdrawn, Citroen seem to be gearing up for the WTCC. I had hopes that Red Bull promotion and presumably new TV deal(s) would renew the WRC but my hopes aren’t high now.
Porsche is going sports car racing
Yes, starting in 2014, head to head with Audi.
According to Ulrich Baretzky, head of Audi sport engine development. the plan is for Audi and Porsche to fight it out, one using diesel hybrid power and the other using petrol hybrid power.*
Hopefully, that should quell the Audi F1 stories for a while.
I gues this isn’t directly about F1, but it shows that the wider scope of LMP engine rules may be one of the things that is attracting manufacturers.
(*Due credit should be given to Mike Fuller at Mulsannescorner.com for this information. It’s not a rumour, it’s a quote from Dr Baretzky at a Institution of Mechanical Engineers lecture).
I think Porsche are hoovering up good talent – because they ARE good talent and its a buyers market for human assets right now quite frankly. They will be needed in other area’s of the companies endeavors and right now working on an interesting motorsport project is a huge draw for these type of people. Porsche think long term and have one of the highest % of engineers to workforce population in the industry. Besides, today’s P1′s are closer to F1 in engineering and design then they are to a road car – why not employ F1 talent to complete that process by creating F1 *like* sports cars? They are pretty much there already when you look at road holding, terminal velocities and fuel efficiencies. I won’t debate Karen on her F1 viewing figures but there is more to creating a racing program then how many people are sitting in front of the TV – it has to be relevant to the board and shareholders of the firm. Red Bull can point to how many cans of it’s brake fluid (my take on the taste) fly off the shelf’s of 7-11′s. That’s great for them. But Porsche sales people have to dump a stack of reports in front of the board members that have a direct correlation to what they are spending on motorsport. ‘Prove these sales numbers relate to Le Mans’ has been a question asked in the past. This would apply to any F1 program Porsche would be involved in and unfortunately, the company have a long memory and the Arrows fiasco along with the CART single-seater programs cloud any F1 participation view today. If it were reports of *just* an engine program to be ‘cam covered’ (paid by others) I could see them going for a limited program. But not a whole car and not in any way supporting a team by offering an engine with the Porsche name on it and covering these costs. Certainly not while Piech is still in charge.
Hi Joe
I guess that the poor time they had with their V12 in the back of the A11C is still in many Stuttgart memories. If they don’t make it back for 2014 with the ‘clean sheet for all’ engine regs they probably never will. The company doesn’t really have much F1 history anyway – success in the 80′s with Maclaren (via TAG money) and the 1.5l car that won in France with Dan Gurney in 1962, plus the cobbled-together V12. Mention Le Mans and that’s a different story…
I am surprised how long the VW AG (any of their divisions) to F1 talk has continued.
Piech is almost ridiculously hands – on, not in a improper micro-management way.
I know this directly, for so so much smaller business than F1 size deals.
It is possible, that you have someone who truly knows their business inside out.
Disclosure: I was trading adverts into a big organisational change at VW. Talk about a guy who knows what he wants . . bang! Word! From on high, but not filtered.
Why should Peach be any different from a Bill Gates when on form?
What I guess, from the overall style, and organization there, is that one thing they get right is focus on management jobs:
F1?
Bloody distraction.
What impressed me: taking over Skoda.
Just a totally different and possibly more focussed mentality than F1.
I think some people dream VW would get into F1, because some shibboleths would be rent asunder.
For the squinting hard through salt tears view: try the new Porsche Spider.
In fantasy, the rumours started with a standing order: “Do F1, when Bernie has stopped ruining it. Go assess.”
People with vision make lots of plans, most of which they decline to enact.
VW is not presently a customer, this brought to you from a bit of experience, you can’t suck up to them anyhow, so ignore that idea.
Now it’s clear that no one from the VW-Porsche group will go to F-1 any time soon.
It has been confirmed that both Audi and Porsche will compete against each other in LMP1 in 2014 and 2015. It’s likely that one brand will turn to the new merger Grand’Am/ALMS (start : 2014) in 2016 depending upon the new rules for LMP2 in 2016.
Porsche has a terrific brand image and value, it makes about $20 000 on every car it sells and sells everything it makes. It is not unreasonable to claim that it has dominated sports car racing virtually since its founding (WSC, Targa Florio, Le Mans, Can-Am etc.etc) and it is still (arguably?) the biggest racing car manufacturer in the world, churning our a couple of dozens of GT3 RSR Cup cars every year. Its only sporting failures have actually been its F1 attempts (excluding the TAG engine – rumoured to have been a Barnard design anyway). So what can Porsche hope to prove with a small turbo engined, origami-design skateboard that needs 400 people to make it work 40 days a year? It can only cause them grief…..
Better leave it to SEAT or Skoda to stick their logo on an F1 car. They probably need the brand exposure more than Porsche and have a closer association with little turbo engines and electrolux save-the-planet propulsion systems. They will also suffer much less image damage if the plot unravels.
Barnard was not an engine designer. The TAG engine was designed by Porsche’s Hans Mezger.
Barnard was there to tell them exactly where the had no idea of F1 requirements though, huge oil catch tanks in the sports car mule etc. I like to think of a Steve Jobs like figure. I think Mclaren also had a very specific concept in mind in that they wanted a Lotus 49/DFV built for each other approach. Just a pity that the rules changed and we never saw the car as designed.
Would competitive people who have worked at the highest level of motorsport be interested in working at some sort of lesser level? What would be the incentive?
There is more freedom to design – especially in the engine
And the chassis and drivetrain. Shame about the “Big Honking holes” and the “Big Honking fin”.
The entry at Le Mans this year was very diverse. Different kinds of hybrids, the deltawing. I posted at the time that when I watched it I kind of felt as if this was what F1 in the 70s must have been like.
Exactly why Porsche is not heading to F1 just yet. The 918 (replete with Martini stripes in the press photos) is a very attractive throwback to my youngest years. Where do you find people with budget for cars now, demographically?
It’s worse than that, because there has been at least two generations dropping out of mainstream economics. In Japan that is highly exaggerated. But I even saw it in my contemporaries. Baby Boomer parents, stand to do fine over nothing. 20 years passes, and you have the hipster generation. That lot heading to a showroom any time soon? They likely will reject even super efficient diesel turbos as “not eco enough”. They can by all means slug my liquid nitrogen or hydrogen for me and slop it into the can, though . .
snideness aside, this is one area F1 can do something. And beat the hipsters by being able to say “I was into XYZ _before it was cool.”
Sometimes I think that there must be a measurable market for serious motors, defined by middle aged dads basically saying “FU, Son, you lazy git, THIS is what I was on about when you were created.”
So, though there are many auto execs I admire, Ghosen and Marchionne being notable characters, nobody but nobody is flesh and blood auto biz like Piech. He’s spun so many businesses on a hairpin within a decade and a bit, if he wants F1, every division would be in on the game (something he has done for each change) and so no need for signalling intent.
Just stumbled across this rather nice set of photos of Peach in context:
http://stuttcars.com/about-porsche/ferdinand-piech/