Feeds:
Posts
Comments

Oh, what a mess…

Last night, at strange hours that have little logic in the media world, Sauber issued two press statements: the first denying reports that its two drivers were being treated differently; the second announcing the departure of Monisha Kaltenborn, citing “diverging views of the future of the company”. This was, as we say in English, rather arse-about-face. The statements were issued in the name of Pascal Picci, the team chairman. This is strange. Picci, as previously mentioned in an earlier post, can count less than 10 Grands Prix attended in his life (I have seen him at a few races, but I doubt he’s in double figures yet), which does lead one to question whether it is wise to have divergent views from a team principal who has been around the sport for 20-years and is one of the sharper brains to be found in the F1 paddock. It was this intellectual ability that led to Peter Sauber appointing Monisha Kaltenborn as the sport’s first female team principal, and giving her a third of the shares in the team. Peter Sauber could never be accused of playing to the gallery by appointing a woman to the job, in order to be politically correct. He chose Monisha because she was the best person for the job. Thus the divergence of views with the chairman does not sound like a very clever reason to split the team from its motive force. Picci may be very skilled at managing other assets, but Monisha is an asset and, if she is walking away from the team that she obviously loves, she has obviously not been managed very well.

As to what happens in the future, who can say? The Switzerland problem remains, although some ambitious folk would move anywhere to become a team principal. The obvious names have already been mentioned but I forgot to include Graeme Lowdon of Manor, a man who knows how to do the job and is available and wants to run an F1 team again.  There have also been reports about Colin Kolles, who has been out of the F1 game for a few years but might also consider the position if it was offered to him. Others might be wary of a chairman who ditches the pilot while the team is still in choppy waters. 

We will have to see how all of this develops but the big fear is that the departure of Kaltenborn  will lead to the team delaminating. There are the hard core Sauber folk, the locals who have worked there for years, but the teams needs more than that to survive and it will take a good leader – and good management of that leader – to get where it ought to be.

When all is said and done, there is no law to stop people wasting their money by thinking they know best. It’s not the first time we have seen that happen – and it probably won’t be the last.

Kaltenborn’s departure does add to the increasing feeling that being a team principal is increasingly like being a football manager. That’s not very healthy for the sport because success takes time, money and good understanding of the sport and how to run a team.

There have been rumours for some days about a possible new Formula 1 racing team being put together with money supposedly coming from China. A little investigation reveals that a British registered company called Bronze Fortune Ltd, which has been in business since 2003, was renamed on May 20th as China F1 Racing Team Ltd. That is all that there really is at the moment, as the only name involved in the company – French lawyer Michael Orts – is clearly only a nominee.

It seems that things have only become public because some recruiting agencies have become involved on behalf of the company and these have been approaching potential recruits at other teams. Clearly they have not been very subtle about it.

As previously explained, to start a new Formula 1 team the first requirement is to secure an entry in the FIA World Championship. These are not given away. The team may submit entry forms from March 1 two years before the date the entry relates to. In other words if one put in an entry form today, it would be for the 2019 season. The application would then be considered and the FIA would decide on an entry based on the new team being able to demonstrate that it is able to meet its financial and other obligations, that it is headed by a fit and proper person and that it would not bring F1 into disrepute. It would be unwise for a new team to start recruiting staff before securing an entry but the FIA has not announced any such application. In the past the FIA has indicated if there were any applications being considered.

Starting a new team is not really the best way forward because of the fact that new teams have limited access to prize money for the first three seasons in F1. This means that they must be self-supporting before being able to budget for prize money. It is better to buy an existing team, even if the money required up-front would be more.

Just a couple of days ago I was writing about how Sauber needs stability to make progress, but it seems that the whole team has gone topsy-turvy in recent days with CEO and team principal Monisha Kaltenborn apparently set to depart, it seems because she is unhappy with the way that Sauber is being overseen by investment manager Pascal Picci, the chairman of the holding company. He is the front man for investors but it is not clear if they have played any significant role in the story.

The suggestion is that the two personalties were not getting on and that Kaltenborn felt that the chairman of the company was interferring in what she was trying to achieve. Whether she walked or was pushed is currently not clear but some sources say that the decision was mutual. There have been signs of stress in recent weeks with Kaltenborn trying to recruit new technical leadership and the owners wanting to stay with what they have. The word is that at the centre of the problem is the team’s technical director Jorg Zander, who has thus far failed to make much of an impact in his six months in the job. Updates failed to arrive in Spain and when they did appear in Monaco they were not apparently an improvement.

It remains to be seen who will take over the role, although the logical thing to do would be for the team to contact one of the people who has immediate experience in the management of F1 teams at this level. One thinks, specifically, of Dave Ryan and Frederic Vasseur, but the German angle could also bring Jost Capito into play.

The big problem for the team is whether or not the people who were recruited to Sauber by Kaltenborn will stay if she is departing. As previously explained, getting people to move to Switzerland is a big problem.

The FIA World Council has issued a provisional F1 calendar for 2018 with the 21 races featuring a triple-header in mid-season.  The dates are as follows: Melbourne, March 25; Shanghai, April 8; Bahrain, April 15; Baku, April 29; Spain, May 13: Monaco, May 27; Canada, June 10; France, June 24; Austria, July 1; Britain, July 8; Germany, July 22; Hungary, July 29; Belgium, August 26; Italy, September 2; Singapore, September 16; Russia, September 30; Japan, October 7; United States, October 21; Mexico, October 28; Brazil, November 11; Abu Dhabi, November 25.

The Singapore and Baju dates are provisional.

The calendar is rather less than satisfactory in some respects, given that Australia remains a stand-alone fly-away, as are Baku, Canada, Singapore, and Brazil. It was hoped that the new owners would find a better way to link the flyaways to make them less labour-intensive. To some extent they are still tied to the old agreements with the Australian GP unable to move to an earlier date because there is an agreement for it to be the first race and that it must be held on either March 18 or March 25. The switch of Baku to the spring was needed because there were six races vying for a place in July. Monaco and Canada are believed to have contracted dates and the FIA wants the Le Mans 24 Hours weekend to be without an F1 race, and with the required summer date being contracted with the teams this cannot change. It is doubtful whether having racing in August is a good idea as most of the northern hemisphere is on holiday in that period.

The July triple-header is going to be tough for the F1 teams with the Austria-Britain leg being very expensive because of the distance involved and the need for additional logistics. The France-Austria leg is 1100 km, but that is without the need to take ferries. It might have been wiser to have Austria followed by France, followed by Britain, but some of the decision-making is inevitably impacted on how much money the promoters are willing to pay and whether they have set dates in their contracts.

How to fix Sauber

A year ago Sauber was on the ropes. The Swiss team was struggling for money and in serious danger of not being able to continue. The team’s CEO (and then shareholder) Monisha Kaltenborn kept her head. A seasoned F1 veteran, having worked with Sauber since 2000 and having been team principal since 2010, she negotiated a deal for the team to be taken over by a Swiss asset management company called Longbow Finance SA.

Swiss financial companies are never very keen to discuss their financing, but it was clear that the first contact between Longbow and Sauber came via driver Marcus Ericsson, who had moved to the team with backing from Longbow. The Sauber investment that followed was separate to the Ericsson deal, although there were plenty of rumours suggesting that the money behind Longbow came from Sweden rather than Switzerland.

As part of the deal Peter Sauber stepped away from his team but Kaltenborn stayed on as CEO and team principal, under a board chaired by a Swiss financier called Pascal Picci, who has headed Longbow Finance since 2000. He arrived in the team having attended just one Grand Prix in his life and it seemed logical to leave the running of the team to people who knew what they were doing, although it must be said that the history of sport is littered with new team owners who arrive thinking they know all the answers and duly turn their teams into expensive failures. Picci seemed to be smarter than that and said that the long-term idea was to use the F1 team as a way to publicise Sauber’s expertise in aerodynamics, 3D prototyping and new materials to generate other business in other sectors, in much the same way as McLaren and Williams have been doing. This all seemed very sensible.

However, the key to any success in F1 remains performance and Sauber has a problem this year in that the car was conceived at a time when the team had no money and the decision was taken to use old Ferrari engines, to keep down costs and to ensure reliability. It was also taken because Sauber was already discussing doing a deal with Honda for 2018 and there was little point in spending money for what was inevitably going to be an interim season.

Last autumn the team hired a number of well-respected engineers, which was no mean achievement given that Sauber’s biggest problem has always been that it is located in the wrong place. Luring the best engineers to Switzerland has never been easy because a lot of F1’s best talents live happily in the Motorsport Valley in the UK and don’t want to uproot their families and move to the German-speaking part of Switzerland. Ferrari has struggled with the same problem in the past and has twice set up and then closed down technical offices in the UK. In any case, Ferrari is a little bit special given its legendary status. Most engineers want to work at Ferrari at some point. Scuderia Toro Rosso has had the same problem and so in the end it set up a technical centre at Bicester in the UK, where most of the development work is now being done.

Sauber has never done that and finding good technical people has been tough, even in the days when BMW was bankrolling the team. There have been a string of technical leaders since Willy Rampf left the team in early 2010, realising that things were going to be tough without BMW support. Initially James Key joined the team in April 2010 but he left in February 2012. There was no technical director until July 2015 when Mark Smith joined, although he left before the start of the 2016 season. The role was given this year to Germany’s Jorg Zander, a bit of a mystery man to many in F1 because of a career that involved a series of short stays at BAR, Williams, Sauber and then Honda (the old BAR revamped). After this became Brawn in 2009 Zander dropped out of the sport until 2015 when he joined Audi as its head of technology in sports car racing. That too was a short-lived move as Audi stopped its programme at the end of last year and Sauber grabbed him to lead the technical team. This year he has been quoted as saying that the team should be able to move up into the midfield, but this has not happened and updates have been late arriving. The race team did manage to score points in Spain, thanks to a clever strategy, but the upgrades which appeared in Monaco were a backward step and the cars were not fast enough to pull off another strategic coup. There is no question that the team’s problems are more than just horsepower and that there are handling deficiencies as well. With Honda coming to Hinwil, there is clearly a need for a better car and only time will tell if the team can deliver that.

Longbow has remained low profile thus far, as one would expect, but it is logical that the owners will want more performance, having invested their money in the team. Sauber is talking to other engineers to strengthen the challenge. The key is stability and selling newcomers on the idea that the team can move up the F1 ladder, Kaltenborn has done a decent job doing that, but it is not easy…

One might speculate that the recent rumours about a new team being put together in the UK could be related to Sauber’s new owners thinking that a UK technical department might be a good idea – but that is pure speculation on my part.

 

 

 

 

 

Starting a new team

There are rumours of someone wanting to start a new Formula 1 team. Great! But one does have to stop and ask why. Unless you are very badly advised, or have money to burn, you don’t start a new team. The capex involved is massive. You need to have huge guarantees, you need to buy engines and machinery, you need to hire hundreds of people, and you get nothing back. So where’s the logic if you can simply buy a team. There are a couple that are on the market at the right price and while that might be high, you at least know what you are going to get…

It is way too late to do anything for 2018 and there are all kinds of processes that need to be gone through. The FIA doesn’t hand out entries. You need serious financial guarantees and a well-developed plan. Even if you have that, you need to spend a fortune on an engine and your engineers (who you are not going to hire before you get your entry sorted out) need to have access to a wind tunnel and some serious computing power. You need to invest a great deal of money in people and machines and you don’t get access to full prize money for at least two years and probably longer because the current level of competition is high. You’ll have to budget for at least $100 million a year for three years, which means that you would be much better off if you bought an existing team and changed the name. Going down this route you can be up and running quickly, you get the prize money straight away and you can then build the team as you wish it to be built.

So why are there rumours of new teams when they make no sense at all. Yes, perhaps one day there will be franchises introduced, but that is not going to happen soon and revenue splits will remain unfair until at least 2020. In any case, if you buy an existing team you will get a franchise as and when they happen.

So why the rumours? Who knows?

IMG_0051I remember Pierre Trudeau before he became an airport. He was Canada’s Prime Minister forever when I was growing up. Today his son Justin is the Prime Minister and Pierre is now an airport, known also as Dorval. Lots of airports are named after people, but few names actually stick. How many people say: ‘I’m flying to John Lennon’  or ‘What time is the flight to Omar Bongo?’ But if you say: ‘I’m flying from JFK to Charles de Gaulle’, people instantly know what you mean. There are only a few such airports in this category: Ataturk, Ben Gurion, Dulles and Reagan. In some ways, it is surprising that Britain has none of these and sticks with Heathrow and Gatwick, but some would say that this is because of the quality of British politicians rather than the philosophy of airport naming.

Blog Pic 2.jpgOur fly-away race weekends tend to begin and end at the same airport and so we get to know them over time. Trudeau is OK, even if the new lounge didn’t seem to have a licence for alcoholic beverages and had had to resort to alcohol-free booze. We pondered whether perhaps billions could be made in creating alcohol powder to add to alcohol-free drinks. But, like the toaster, the world has yet to find the right answer. We can put men on the moon, but we still cannot make toast instantly…

Anyway, when I left Dorval (alcohol-free) on Monday I was impressed by the level of involvement in F1 to be found in the terminal, including a simulator. It’s great when a city truly embraces F1…
When I arrived at Trudeau on the Thursday, things were rather more stressed because my plan to have an easy run to the track to interview Lance Stroll had been blown up by a late plane, inefficient immigration and slow-moving baggage. I jumped into a cab and explained to Sami the driver that I needed to be on the Ile de Notre Dame in under half an hour. The problem with this idea was not the distance involved, but rather the fact that the roads of Montreal are perpetually under construction. I don’t know why this is (maybe the weather), but it is a nightmare because there are always traffic jams. They have been for as long as I can remember. Sami asked if I minded trying something different and, with nothing to lose, we set off through side streets and suburbs and arrived on the island with a minute or two to spare. Stroll has probably never had a journalist arrive for an interview with his luggage in tow, but he handled it well…

The green notebook had a lot of notes about the calendar for 2018 but begins with a note about Williams sporting director Steve Nielsen departing to join Ross Brawn’s new crew at Formula One, where he will look after sporting and logistical matters and regulations. The word is that Brawn’s next appointee will be former Ferrari chief designer Nicholas Tombazis, who will work with the engineering team to figure out what best to with the cars to make sure that they look good, can overtake one another and can be as cheap as possible.

Cutting costs is important to the new owners of the Formula One group because they want to create a franchise system of sorts and that will need financial controls in place before it can be done.

The FIA needs to have a draft calendar this week (which means it will leak fairly soon) but at the moment the ideas are still a little fluid because of the FIFA World Cup Final. This will be on July 15, with the game being broadcast in western Europe at 3pm. This means that no Grand Prix is going to get a big audience, unless the race moves to a time zone that would allow it to be shown in the morning. Thus the plan is to avoid July 15 (which is also the Wimbledon Finals) and that means that there are problems getting all the races into the time available. Creating calendars is not an easy business because you have to worry about local problems, existing contracts, clashing sports events and so on. Monaco has a contract to be on May 27. Canada is believed to have a similar fixed date (or a choice of one of two weekends). The FIA wants Le Mans to get a free weekend and so  in 2018, June 17 is gone. This is good news because last year’s Canada-Baku back-to-back was grim for the teams. The problem is that with France and Germany returning to the fold in 2018, there are too many races for the summer season with Baku, Austria, France, Britain, Germany and Hungary all trying to get dates in July. No month has six weekends. It seems that Russia will move to later in the year. Logically, this would be replacing Malaysia but that is not easy because moving the freight from Singapore back to Sochi and then out to Japan makes no sense at all. There is the additional problem that President Vladimir Putin does not want a race on his birthday, which means that the October 7 date is not possible. And things start getting cold…

There is a small chance of one of the European races moving to a date in early May to relieve that pressure. The plan is to increase the number of back-to-back events, in order to use the time more efficiently, but the logistics involved in this are very difficult, largely because of the team hospitality units, which take an enormous amount of effort. It is clear that if F1 is to increase the number of races on the calendar in the future the teams need to add more staff – or reduce the amount of equipment and people needing to be moved around. You go heavier or you go lighter…

One idea that has been tabled is that of a triple-header (three races in three weekends) but the teams are largely opposed to this, particularly if it involves the already-difficult Austria-Britain back-to-back, which costs huge amounts of money because of the need to have additional crews to cover the ground necessary. It might be possible to do Austria-France-Britain, as the distances involved are slightly less dramatic. But, let us remember that teams with money have never worried too much about the costs. There is a legendary tale of two sets of Goodyear qualifying rubber (eight tyres) being booked eight seats on a Concorde flight from New York to London, in order to be used by Ferrari…
The driver market for next year was also a big talking point in Montreal with Ferrari being the key over what happens with Kimi Raikkonen. If there is a change at Ferrari then the rest of the market will move. The current thinking is that Ferrari would go for Max Verstappen if he was able to get out of his Red Bull contract, which might be possible given performance clauses. The Red Bull team had denied this, but no-one believes the denials.

Elsewhere, McLaren won the revived raft race in the rowing basin on Saturday evening. This was stopped a few years ago because fun was not allowed in the paddock in those days and the revived event was a big hit with the teams being given equipment to design and build a raft in an hour. Three teams did not take part: Ferrari, Mercedes and Force India (great PR work, guys) but everyone else had a good time, including two crews from Formula One and one from the FIA. Ross Brawn and Sean Bratches were part of the crews, Bratches with his trousers rolled up in true bank-manager-goes-to-the-beach style. It was entertaining to try to imagine Mr Bernie Ecclestone doing something similar…

That was a bit of levity for McLaren, a team that has had little to smile about in recent times. The word continues to be that a divorce in coming with Honda and it is really a question of when, rather than if. The replacement engines would come from Mercedes and some would like to see this happen after the summer break, rather than at the end of the year. Honda is not happy about the idea, but to be fair to McLaren it has been pretty patient and Honda has not delivered the goods. The team has yet to score a point and is last in the Constructors’ Championship. It is an unthinkable  situation for McLaren.

Blog picBratches also got excited about the latest addition to activities in the Paddock Club, a Scalextric set of the highest order, which Paddock Club guests can compete on, with prizes for the fastest time of the day. This will go from Grand Prix to Grand Prix in a very large box, which needs to be bullet-proof as the detail involved in the layout is spectacular. Here, you can see Ross Brawn checking it out. He later had a go, having sussed out which was the quickest car…

There was also lots of talk of a mid-season switch of a different kind over at Renault where Jolyon Palmer’s season continues to be fairly poor. In part this is due to technical problems he has had, but getting close to Nico Hulkenberg is what is required and the word is that Renault want to give someone else a try. That someone will likely be Sergey Sirotkin. There are some romantics who think that Robert Kubica might make a comeback in F1, but that seems rather unlikely and the suggestion for 2018 is that if the team cannot afford Fernando Alonso it is more likely that Sergio Perez will come on board. This depends on what happens with Force India and Vijay Mallya. His extradition hearing in Britain has now been pushed back to December 4, because of delays in evidence arriving from the government of India. Some media reports suggest that this means that there isn’t any evidence, but if that was the case he would not have been arrested, so clearly he still has problems to solve. Indian bureaucratic inefficiency is legendary…

There was a bureaucratic screw-up in the race in Montreal when the FIA Stewards gave Danny Kvyat the wrong penalty. It was not intelligent of the team to let the Russian take up his grid position after being left behind on the pre-grid. The rule is clear. If the driver is the last car away, he starts at the back. If he gets going before the last car passes, he takes up his grid position. Generally-speaking the FIA Stewards are pretty good these days, but this time there was a mistake and Kvyat was given a drive-through penalty, rather than a 10-second stop-and-go. It might have been wisest not to try to correct the mistake and just let it lie, on the basis that double jeopardy is established in most legal systems. Once a court has punished an accused person, they cannot punish them again for the same crime. The decision was taken to give Kvyat another 10-second penalty. The Russian was not impressed and was fairly blunt in his assessment of the authorities. “They have a job to do which is not so difficult in my opinion and they cannot do the job properly,” he ranted. “They were clearly sleeping today in their office, so maybe they needed some coffee there. They should cancel this stupid rule. Who is this rule for? Are we taxi drivers here or Formula 1 drivers? I don’t understand this. It’s a circus, a stupid f**king circus.”

There was a certain amount of sympathy for Kvyat, because it was not his fault that the stewards made a mistake, but perhaps it might be wise if he were to learn the rules and not make such silly mistakes in the future. Given how much money the drivers are being paid, it is a bit surprising that they cannot find a little time to read the rules…

There is, by the way, an undercurrent in F1 circles that the drivers could soon become subject to a salary cap, as teams look for ways to reduce F1 costs. This would mean a limit on what a team could pay a driver, but sponsors could, no doubt, provide additional earnings if they wished to do so. Something that may also come up in the future is a requirement that would go with the superlicence to have drivers bound to give up a certain number of days per year to promote the sport. This is second nature to the drivers who compete in other championships but F1 drivers have long avoided promotional work if they can… The new management is not as generous in this respect as was Bernie Ecclestone. We also hear ruminations about whether or not it might be a good idea to have more than one tyre supplier in the future. Pirelli has an exclusive contract until the end of 2019 but it is no secret that Michelin would like to enter F1. A tyre war could create more unpredictable racing. However, tyre wars are expensive and can be dangerous as companies push for the limit. The traditional pattern of a tyre war is that a new company comes in and after a fight one or other becomes dominant and the other pulls out. After a period, the winner also leaves the sport because single tyre formulae offer little coverage unless the tyres fail. Pirelli has tried to use F1 to show how skilled the firm is but it has tended in recent years to be a little cautious to avoid bad publicity from making tyres that are too soft. This means that the racing is not as exciting as it could be.

Among those spotted in the paddock in Canada was GoDaddy CEO Blake Irving. He was a guest of McLaren. The company has had talks with some teams in the past but has yet to come up with the cash required. The company has been transforming itself into a global business in recent years with a focus on Asia. The company now owns one of every five internet domain names and is expecting this year to have total revenues of over $2 billion, which would be 19 percent more than last year.  GoDaddy, it will be recalled enjoyed huge success in IndyCar and NASCAR, supporting Danica Patrick.

Blog pic 1.jpgAnother thing worth watching for is the Latifi Family, which controls a business called Sofina Foods Inc, which is a massive meat-producing company.  Michael and Marilena Latifi are the parents of Formula 2 driver Nicholas Latifi. They were spotted spending time with both Toto Wolff and McLaren’s Eric Boullier over the Montreal weekend. These are busy people so they were probably not there just for a chit-chat…

Meanwhile, Lance Stroll ended up on the front pages of the local papers…