The latest I hear from Spain is that redundancy notices have been sent to team members and that unless a buyer can be found in the next couple of weeks the team will be shut down in December. There is very little chance that anyone will now buy the team. It is hard to see how there can be any work going on for a new car when the team is likely to close down and without a new design there is no future at all, because next year would simply be a repeat of the current season. The team has no real assets. It is renting premises in Madrid. Its only reason for existence was to try to build up value in order that the owner Thesan Capital could then sell it and recoup the losses on loans that were previously made to the previous owners of HRT. As things have not gone well, the bankers are now going to have to write off the debts, or if the team can be sold, accept a small percentage of the money outstanding. The team has a Cosworth engine supply for next year but nothing for 2014. In theory the team could be sold for $1 and the new buyer would then have to be willing to take on the employees, there would still be a need for at least $30 million to run the team next year, and that would be at a level similar to now, which is not really going anywhere. In the circumstances shutting the team down is the best option, to avoid debts and to extract the bank from a business it clearly never understood.
There are rpeorted to be attempts still going on to save the team, but there is no money in Spain and a team outside the top 10 in F1 does not have a huge value, unless there has been actual investment made in assets.
joeblogsf1 
The loans are a drop in the ocean when compared to what the Spanish banks will eventually right off against property.
Even the prize money for coming last (around $10m Joe?) won’t go far I guess
What’s the chance of both cars doing 1 lap of the race to avoid an FOM penalty and then the cars are retired? Apparently there are concerns expressed by engineers for the safety of the drivers in Austin due to a chronic lack of parts, as reported in a Spanish publication today http://wp.me/p2HWOP-qa
Sad news. I’d like to see anyone who mocked them try to achieve anything remotely as creditable given identical resource and challenges.
This also likely draws a line under Pedro de la Rosa’s career I suppose.
Sad to say its hard to see this having any impact at all on the 2013 season, major investment was needed months ago if they were to keep Caterham or Marussia within range.
Yeah, too late. We’re gonna have less cars in 2013.
I wonder ,how it would have turned out ,if Amancio Ortega-Zara(Inditex) had owned the Team from the start ,instead of bankers..
Toro Rojo Joe?
Probably less likely to sell when you write this here eh Joe? Kick em whilst they are down!
Any serious business person with enough money to buy the team would realize this within a few minutes of looking at the team. They don’t need to read it here or anywhere else. Joe is just reporting what he believes to be likely based on his experience.
Thank goodness we didn’t get Prodrive.
This is a tragedy. F1 for me will never be the same. First Rai losing TV rights and then this. Can anyone tell me about a lottery giving 30 million to buy it. Really sad. also, that’s why they had the site down for that much time.
Hey Schumacher, get those Mercedes money and buy HRT, please!
Yup, that’s another loss of broadcast to Sky (Italia) that is going to hurt. Ole Rupe really going for the jugular in the core markets.
I too so wish someone with their own money would pile in and adopt the more lost teams. But I think a big reason this does not happen may be that any seriously self made man, sees a fisherman from afar, basically takes one look, and knows it’s Bernie’s Game, and never gives it another thought. There are plenty enough people around who could genuinely afford to run a proper team, but precious few who want to dive in to the murky waters that sadly seem to prevail. Anyone who has rough and tumbled it in business does not want their sporting interest to basically be more and more business and politics and intrigue. Least that’s my guess. Maybe we could do some reverse psychology, have a Evening With Joe, billionaires only allowed, headline “Why You Don’t Want a F1 Team”. Yeah, tell them they can’t have one, it’s a dying breed. Annoy the buggers until someone bites. If I do ever work out how to sell those tickets, promise you I’ll be straight on to Joe .. ouch, now I have a image of visiting a dog rescue home . .
Funny thing I had today, a request for a bit of tech support, because the Cyprus companies house website won’t work in modern browsers (they have a old bit of javascript rejecting the new browsers) and I started wondering . . then read this: http://arstechnica.com/business/2012/11/dutch-sandwich-with-a-side-of-tax-relief-may-soon-be-off-googles-menu/ Hmm, aha, erm, okay, I kind of see the rush . . What I mean by genuinely rich people is not those who have a valuation placed on them dint they’ve paid marginal naff all tax. News Corp managed to average about 3% for decades,The Economist studied, long ago. If you get the irony, I used to boast I nearly managed to pay less. That was, erm, because the money was going out of my company, though ..
Joe, in your October 9th essay on F1 finances, you mentioned “The 11th and 12th teams get $30m apiece…”
If I read your post (above) regarding HRT correctly that it would cost $30m to run the team of a year, if one was able to buy the outfit for $1 and carry on you could theoretically break even if one was amenable to running around in last place. If indeed it is a zero-sum game for 2013, it would provide someone the opportunity to at least have a viable commercial platform to try an make a go of it without too great a risk.
And if one was able to hire a driver with some funding…
No I meant $ 30 million in addition to the $30 million
Could run the team like Hesketh in the Bubbles Horsley days.
How much does Karthikeyan pay? $10 million for the season? Find another pay drive at the same rate, (Petrov, Ma etc) and another $10 million from sponsorship/rich benefactor must be doable. Is Chelsea paying Sauber anything, or is it just mutual benefit by association? Given what you were saying about football clubs there must be quite a few Glazers/Al Nahyans about who would see $10 million as a good investment to get on the F1 publicity tour, both for their Football club and their personal ego’s.
Presumably they can run this years new car until the end of next year, and then a tie in with Williams to produce the car Force India style.
Failing that, you can expect Danny Bahar coming up with a plan to create a Spanish Ferrari, launching 3 supercars a year for the next years…
Isn’t the entry worth something ? That’s what we were always told in the past when people like Prodrive were trying to get in and couldn’t. Has something changed ?
Back then F1 was limited to 10 teams and we had 10. Now we have 12 teams and F1 is limited to 13, so there’s still room for someone to put together a program without needing HRT.
OT,
Why Chelsea and -Sauber-?
Not UK-based, not a winning team or powerful brand in the way that Chelsea is, what’s the attraction for Chelsea? Wouldn’t Red Bull, Mclaren, Mercedes, Williams or Lotus all have been able to make a more compelling proposition?
Totally baffled by this.
There’s several B2B discussions but I suspect at least partially it’s part of Chelsea’s seemingly successful bid to meet footballs new finance rules with some very careful transferring of money.
I feel sorry for the staff, but I shan’t miss the team. This outfit has been a gong show from the start, with its infighting between Campos and the rest, Dallara’s troubles in getting paid, and then the new owners kicking Kolles to the kerb. It seemed at the time the new entries were announced that this outfit was a political and not a sporting choice, and it is just a shame that Max Mosely isn’t around any more such that his face would be the rightful wearer of the egging that is due.
So the team has nothing as assets beyond a Cosworth contract for one year and admission to the F1 circus. I’d presume that the current owners will cover the costs of staff redundancy for the majority and pay off outstanding debts etc. That still provides a “shell” team with an F1 admission ticket which is not tied to a location. There would be a few current employees handling the ownership change for the new owners to compensate.
The way that HRT has been run makes it cheap for somebody to take it over. The identity can be transferred to a UK factory and is not bound by geography. Paying redundancy will not be cheap (although perhaps cheaper than a few years ago in Spain) but settling up might provide a saleable business title.
My presumptions, of course, can only work if there is somebody who wants to create an F1 team. The new owner doesn’t have to be Spanish, of course, just rich enough. Joe’s presumption is that nobody will take the risk.
I doubt in the current financial crisis and given how difficult it has been for HRT, Virgin/Marrusia and to a lesser extent the well funded Caterham team to establish themselves, that anyone will be coming forward to buy the grid slot.
But…. imagining that someone did have the money is Lola not for sale currently and did they not have a mothballed F1 setup ready to go if the opportunity came about?
Still a long, long shot however, especially as there are quite a few other teams on the grid apparently in need of investment that would require less work.
As HRT were going nowhere I don’t see this as a loss at all to the sport, however it is a warning to the rest of the grid and I feel that losing any more teams would be a real disaster. I wonder how this will effect Marrusia and the Cosworth engine supply? Would it make any difference, improve matters as less time is spent on HRT’s supply or become uneconomic for Cosworth to continue investment? Is it possible that Marussia would need to switch supplier? And to who would they switch if they need to do so?
What about the entry to race in F1?
You could run it with two pay drivers and the FOM money. I offer 2 €!
Yes the cars are rubbish. But isn’t this essentially a Formula 1 franchise up for grabs? One of only 12 in the world? Surely there is someone out there looking to get into F1.
like , I suspect , many F1 fans I was delighted with the idea of the new team coming into the sport
but when the teams were announced and it said that this team were going to be based in fuente alamo my heart sank
and it has all been downhill since that
It should always be a concern when a backend team folds nowadays. Whatever people may think of their achievements (personally I feel, not too bad considering their lack of funds and compared to the splendidly incompetent backend teams from the early 1990s) we need a grid full of cars to see a proper race. OK so they’re the slowest out there. Take them away, and someone else becomes the slowest. Then take the next slowest team out; maybe any team that gets lapped, and eventually you will have about 10 cars left. Some grand prix that would be!
This is a team no one thought would make the first race of 2010, let alone make 2011 or 2012. And yet they have attended every race (albeit a couple of DNS due to 107%).
They beat Virgin twice in their first two years, yet no one mocked Virgin in the same way.
A bit of respect here, what they have achieved was pretty remarkable given their lack of funding. Well done HRT.
I actually agree with what you say here. And I disagree with Joe, at least about the significance of not having a new car in development for next year – if I was running HRT, I’d aim to stay inside the 107% with the current car, and save my tight budget for an all new car for the new regs in 2014.
But I do think most of the credit for getting HRT onto the grid (and with a relatively respectable pace) is due to Colin Kolles and his team, and most what credit is left is due to Dallara for the original car design. On the one hand, I think HRT have done a better job relative to money spent than either Virgin (cough…Nick Wirth…cough) or Caterham. But on the other hand, I don’t think the current management or owners contributed much to those achievements, real as they are.
Whatever your personal take on HRT, their management, their track performance; the loss of a team was inevitable by the end of 2009.
Three teams entered at a time when the Mosley budget cap was in place for 2010, team budgets were going to be slashed across the boards and the potential business model for an F1 team was looking quite interesting.
A hollow dream perhaps, a naïve one for many journalists & pundits, but some saw a bright future in F1.
As soon as the teams forced a U-turn by the FIA it was inevitable that we’d lose one of the new entrants within a couple of years. Would any of us genuinely be surprised if Marussia followed them out the door within the next couple of seasons?
People are quick to punish HRT for their mistakes or their unconventional decisions, but fundamentally the loss of a team is down to the failure of the teams, FOM and the FIA to bring the financial aspects of the sport under control.
Great comment, particularly the last paragraph. The sport/business looks to be in fairly deep doo doo unless costs fall dramatically and quickly. It’s also becoming far too complicated on track for the average punter (including me) with tyre tactics etc and if they’re not careful they will lose the viewers as well
Well said.
Looks bleak for them, sadly. I don’t subscribe to knocking them just because their cars were slow and they happened to be based in Spain, or because the owners were naive or misguided. At the end of the day the guys actually doing the work on and in the cars are hard-working, decent blokes doing their best under difficult circumstances, and in their own way are living a version of the F1 dream. As someone above says, in 2010 and 11 they beat Virgin fair and square, so credit to them for that. It’s hard to see who or why, but I do hope someone with their own, “real” money comes along to pluck them out of the abyss.
They only beat Virgin-Marussia in 2011 because the backmarker battle is a medal-system. That year, HRT cars managed fewer finishes and on average finished further back than the Virgin-Marussias. If F1 ran on MotoGP scoring (points down to 15th), HRT would have won in 2010 but lost in 2011.
On just about every measure except “what’s your single best race finish?”, Virgin-Marussia beat HRT in 2011 (and Caterham are beating Marussia in 2012).
It’s a bit out of date (I’ve been pretty busy recently) but you can take a look here :
https://docs.google.com/folder/d/0B9yJRPS_uTidd3FZOUJfUTF4UTQ/edit
Antena 3 (Spanish TV that covers F1 after merging with La Sexta)gave them loads of coverage during the race previews, Toni Cuquerella explained F1 engineering concepts during those spots,,really sad that somehow down the line it didn´t end up better!!
Where to fit this in http://timesofindia.indiatimes.com/sports/racing/top-stories/Chinas-Ma-Qinghua-focused-despite-HRT-sale/articleshow/17227497.cms
Ma Qing Hua going to drive for HRT somehow in the next Chinese GP; Does he / his management know anything we don’t? Or did they even put money in it up front? Or could it be a call for support/money to actually make the car appear on track for that race?
Or is it just wishfull thinking
There was a romour many years back (when Alonso was still driving for McLaren), of Santander wanting to sponsor two F1 Teams ..Was it just a rumour?At the time ,it was said that Santander wanted McLaren to use the Abbey name and the other team to go directlty under the Santander banner (with Alonso) …the other team ,,was to have their cars made by McLaren?
This time Mr Botin(Santander) could have used his second Spanish Bank brand Banesto,to be a full sponsor of the HRT Team(or directly buying the Team ,thus avoiding any possible conficts with the other banks involved in ownership in one form or other)..
I’d love to see stoddart buy them and run a new minardi team
Does anybody remember Stefan GP? Wouldn’t this be a good chance for the guy to fulfill his F1 dreams? What do you guys think? Cheers,
The guy never had any serious money. He talked a lot.
They have changed their mindfs, and the latest I know of Stefanovic was that he was trying to join the Premier League in Portsmouth’s place when they entered in administration back in 2010. A complete clown.
why dont 50 million people give a pound & sponsor the team
I’m surprised HRT is still going. The car has always been noticeably white and missing much-needed sponsor logos (and dollars). Shame for the people who work at the team, though, if it closes down. Hopefully most of them can stay involved in motorsport in some form. Given Mallya’s problems with money, I wonder whether Force India will continue into 2013 or be bought by somebody else?
HRT performed a heck of a lot better than USA Formula One or whatever that joke was called