Seeing through the smokescreens

The news that Ferrari and others are not going to enter the 2010 World Championship has provided plenty of copy for the sport’s journalists. There are plenty of smokescreens to be seen through here. If everyone is going to have the same smaller budget in the future, what is the problem? It is not about job losses. As FIA President Max Mosley says, if he does nothing jobs will be lost as teams close. Is it that Ferrari enjoys an unfair advantage at the moment and wants to continue to have that? Or is it that some of the teams simply do not want anyone to have access to their financial information because they have things to hide? Could it be that some of the car manufacturers are going to use the issue to leave F1 because they cannot afford it or because they cannot be competitive? These are all explanations that are flying around. Is it about Max Mosley defending the institution of the FIA or about his own need to be powerful? Similarly, is the Formula One Teams’ Association simply a vehicle for Luca di Montezemolo or Ron Dennis to win battles?
It is a complex business.
But it is not new. Enzo Ferrari had a habit of announcing that he was pulling out of Formula 1 whenever he needed something that he could not have. The mercurial team boss used this tactic to good effect on many occasions, working on the theory that the power of Ferrari’s box office clout would allow him to get what he wanted. It usually worked. However, in 1964 Enzo wanted the Ferrari 250LM homologated in the GT class for Le Mans. The FIA refused and in the dispute that followed Ferrari lost his competition license. At the end of that season the Ferrari F1 team entered two Grands Prix in the blue and white livery of Luigi Chinetti’s North American Racing Team. In the end Ferrari had to back down on that one.
In the 1980s, however, FIA President Jean-Marie Balestre tried to push Ferrari around over engine regulations and in the summer of 1985 Enzo threatened to withdraw from F1 and switch to Indycar racing. To make the point Ferrari sent his sporting director Marco Piccinini to an Indycar race at Michigan and soon afterwards “spies” spotted Indycar team owner Jim Trueman and his crew chief Steve Horne visiting Maranello. Soon after that Truesports driver Bobby Rahal and Ferrari driver Michele Alboreto both tested a March-Cosworth 85C at Fiorano. Enzo
Enzo then hired designer Gustav Brunner to design and build the Ferrari Indycar, which was designated the 637. That car never raced but a compromise was sorted out that allowed Ferrari to stick with its engines longer than the FIA had wanted. Much of the Ferrari Indycar technology was ultimately used by Alfa Romeo in its unsuccessful Indycar programme between 1989 and 1991. On that occasion, therefore, Ferrari did get some of what it wanted.
When Luca di Montezemolo took over as head of Ferrari he soon began to use the power that Ferrari has. As early as February 1993 he threatened to pull Ferrari out of F1, arguing that the sport needed to use technology that would be more useful in road cars. He called for restrictions on technology and cuts in costs and he got some of that as the FIA soon began thinking along the same lines. Since then it has served Ferrari’s purpose to be aligned with the FIA.
It is worth noting that in 2004 Montezemolo gave up the day-to-day running of Ferrari, handing it all over to Jean Todt, so that he could move to Rome and run Confindustria. He returned in May last year and two months later he was the force behind the establishment of FOTA. One could thus conclude if one wanted to that Montezemolo is FOTA and that he wants to achieve what the Formula One Constructors Association (FOCA) failed to achieve back in 1980-1982 when they tried to win control of the sport. That battle was a draw, with FOCA winning the right to exploit the commercial rights of the sport, on behalf of the FIA, but the FIA retaining control of the rule-making and the policing of the sport. Since then the stucture has changed somewhat. The commercial rights devolved from the teams to Bernie Ecclestone’s private empire, while Max Mosley moved from being a champion of FOCA to becoming head of the FIA. In signing a 100-year contract with Ecclestone, the FIA recognised Ecclestone’s right to exploit the commercial rights of F1, thus cutting the teams out of the loop. They were bullied or bought off at the time but the problem was going to come back again because the split of revenues was always going to be a problem. FOTA is the embodiment of a desire to take things back to a structure which gave the teams the right share of the business. FOTA has been working quietly to improve the sport, introducing its own cost-cutting measures back in December. The FIA budget cap is perhaps a good idea but the teams all disagree on how high it should be and when it should be introduced.
However, they know that if they are divided they will have no power at all.
My view is that the threat to quit F1 is a sign that there are bigger issues that need to be addressed. This is an opportunity to question the way the FIA operates and the relationship that exists between the federation of the Formula One group, which allows so much of the money generated to leave the sport. Mosley says he is defending the power of the FIA as an independent arbitrator for the sport and, at the same time, trying to build a better F1 for the future. These are noble goals, but some people do not believe that this is his only motivation. Mosley may even agree with the teams on the question of the distribution of wealth (he has hinted at that before) but his view seems to be that it is better to fight one battle at a time. He talks of bringing in new teams and new technologies, which is terrific except that there is only one serious new team under discussion and I would say that sacrificing the manufacturers in order to get USF1 and maybe David Richards, Lola and whoever is not a worthy argument.
Formula 1 is a world filled with good brains and we hope that the best will come together to find a suitable solution that safeguards the sport, preserves an independent governing body and splits the revenues fairly between all of those who are involved in the sport.

6 thoughts on “Seeing through the smokescreens

  1. Was the early 1980s FI(S)A/FOCA battle really a draw? If you look futher down the line you see ex-FOCA men (or Bernie’s minions if you will) took over the FIA – foremost being Max Mosley, but also Charlie Whiting, Herbie Blash etc. etc – I’d argue that in the long term FOCA well and truly won that one!

    You’re right though to pintpoint the Bernie/FIA 100-year deal (and Bernie selling up to CVC) as the seed which started the current mess… lets hope it works out in the end!

  2. It is a serious business, we cant keep thinking that the recession would be there forever, we have to come out of that, there would be a better economy than today tomorrow, then WHAT?

  3. FOTA was created between LdiM and Ron Dennis in lieu of their mutually assured destruction, as a result of the Stepney incident.

    The only viable short term recourse is for FOTA (ie car companies) to purchase the CVC stake in Delta Topco, give them their financial return so they go away, place the holdings in a trust and administer the sport like a utility with a public board of directors.

  4. This begs two questions: Who’s to blame? And what to do?

    I’m amazed drivers are all relaxed about the issue, like Kimster already said he’s with the team on this one, does it mean he doesn’t care about his contract? Yeah, no F1 next year? – Cool, I’ll do some rallying then. But with all the money he made during all these years it wouldn’t matter. Could Jenson be the last F1 champion as we know it? I hope the FIA & FOTA don’t spoil the pleasure of the silly season for us fans, now is the most exciting time of year for speculation, but if half of the grid is pulling out of the sport what’s there to speculate about? Monstrous, insane and it’s leaving us without bread and circuses.

  5. Let’s say MM calls the bluff of Ferrari,Red Bull, Renault, Toyota, BMW et al during the Friday meeting,and he doubles the budget cap for 2010 to $117.6 million. Does all this tension go away?

    No

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