Oh Lord…

…I agree with Max Mosley.

The former FIA President has been on  BBC Radio 5 live as a result of the collapse of Caterham and Marussia and I have to say that I agree with his views.

“The big problem is that the big teams have so much more money than teams like Caterham and Marussia,” he said. “From a sporting point of view, the sport should split the money equally and then let the teams get as much sponsorship as they can. A team like Ferrari will always get more sponsorship than Marussia, but if they all get the same basic money, then they all start on a level-playing field, particularly if you have a cost cap where you limit the amount of money each team is allowed to spend.”

We also seem to agree on the engines.

“I’m in favour of the greener engines,” Mosley said. “The mistake was not saying to the big manufacturers that you can spend as much as you want on research but the maximum you can charge per season is something like £3-4m instead of the £15-20m, which I believe it is now.”

All very sound, Max.


153 thoughts on “Oh Lord…

    1. Mosley has a point in saying that the engine builders could have been told that you can spend £ what you like to develop your motor etc, but only charge £3-4 million for them per season. Unfortunately the bit where this goes wrong is that you are dealing with Plc companies that have to make ROI to their Shareholders, so the premise Mosley puts forward would not be in anyway financially attractive to Company Boards. I suspect that even at rates of £ tens of millions per year, ROI on the current engine deals, it is most likely that the engine builders will need years of this Formula so that they can justify the investment made….so look forward to Merc being Champs for the rest of this decade at least.

        1. It won’t deliver value with falling numbers of competitors. This just leads to falling attendances/audiences which leads to fewer sponsors. I read that RD says Mac are struggling to find a principal sponsor, and Bernie now reckons that the rules changes haven’t helped F1…..there is only value in anything in life, while people want the item. The evidence is clear that people are turning off F1 and teams cannot afford to be in it, logic dictates that it is therefore not providing value as it was in past times.
          Lopez pointed out at the FIA PC this weekend, that it is absurd to spend $300m a year and be 4-6 secs a lap quicker than a GP2 team operating on a budget of $4m a year. I’ve been saying for years, at least a decade, that F1 was just going to price itself out of existence with the huge yearly increases in costs to compete, it has never made any sense to me at all.

    1. Unless Jean pries open the back door and extricates the FIA from the very sensible sale of F1’s commercial rights for a pittance. The 100 yr term may be Jean’s first clue that it’s time to get the FIA’s snout back in the trough.

      No one should begrudge Bernie’s return on investment for organizing the sport to the level of it’s previous success and reaping the rewards. However, signing the rights over for such a long period of time with only minimal reviews to the terms raises serious questions about whose interests these agreements were meant to benefit.

  1. Ha ha perfect. I literally heard that on the radio and thought – ‘wow, does he read Joe Saward now?’

    The end times are surely upon us…

    1. He would have delivered the budget cap had it not been for the shortsightedness of the GPMA, and if they didn’t oust him from his seat. Now where are Toyota, BMW and Honda (they’re not back yet)?
      I don’t share Max’s proclivities in the bedroom, but in terms of the governance of F1, he has often been right.

      1. I hear you, but the guy is hardly blameless. In fact he was bloody awful and only looks better because the guy before him was crazy and the guy after invisible. Don’t forget he sold F1 to BE for peanuts and that is where the real trouble started.

        1. His statement regarding Ferrari is quite ironic as I recall that he was also quite favorable to Ferrari and didn’t treat other teams the same, especially McLaren. McLaren received quite a lot of his unfair treatment, probably due to his relationship with Ron Dennis.
          As biased as he may be, he is a very intelligent man although it seems his arrogance has always clouded his judgment.
          However, I do agree that the FIA missed an opportunity to protect the smaller teams by not capping the price of engines. Now that would have been smart with a direct affect on spending all round.

          If F1 is ever forced to go down the route of ‘customer’ cars I do hope they cap, just as with engines, the amount of customers per manufacturer. Furthermore, I hope they then don’t allow teams to by more than 1 ‘component’ form 1 ‘supplier’ team. This way a team have to buy their engine, their gearbox, their chassis and certain ERS components from different suppliers but not more than 1 from the same.

        2. Absolutely agree, he’s made to look a lot better by Todt’s obscurity. And, of course, no one could argue that the 100 year deal was completely above board. But I think to describe him as ‘bloody awful’ is uncharitable. He was arrogant, and forceful, but perhaps necessary for F1 considering how self-interested everybody is.

      2. In fairness though, Mosley launched the whole cost-cap thing far too late in the season and expected teams to slash costs immediately. Max and Bernie even brought forward the entry deadline for 2010 just to try to force various hands.

        The head of BMW F1 at the time (Mario Thiessen) claimed it would mean culling two-thirds of his staff almost overnight. Ironically the 2010 Budget Cap plans would probably have put more people out of work than the combined demises of Marussia and Caterham.

  2. Seems sensible enough indeed. Not many people would like to agree with Max, but hopefully there will be a catalyst to implement soon?!

  3. Shame he inked the deal that more or less ‘sold’ F1 to Bernie and his bloodsuckers though.

    Hindsight is a powerful thing.

  4. He’s right. Of course it would all be easier if much of the money weren’t going out of the sport and the commercial rights hadn’t been sold off to Bernie who sold them off to CVC, who are, in the terminology of their trade, sweating their assets at the expense of the long term future of the business. But a sinner who repenteth and what not…

  5. You had me laughing with that last sentence Joe!

    Mosley is right, just as he was in the final year of his presidency with the budget cap. I’m loathe to be too complimentary, as he has to share some of the blame for signing away the rights in the first place, but at least he is willing to put his voice out there.

    What’s Monsieur Todt been doing?

  6. Well I’ve seen it all now – an outbreak of solidarity between Mosley and Saward. What’s not to like?!

  7. I’ve never really been a fan of Max but he did speak some sense. Just not very often….plus it’s possibly a little easier to talk when it’s not your responsibility anymore.

  8. Indeed.

    Why are the powers that be in F1 that still have a say in things not saying the same thing?

    My thoughts:

    Bernie, I get it, is basically greedy (whether personally, or for the benefit of others). He’s trying to get as much money out of the sport as possible.

    Teams seem to basically be selfish. Anyone with an edge doesn’t want to lose that edge. Teams that can spend more don’t want to lost that edge. They’ve been divided and conquered by their selfishness.

    The FIA? Why aren’t they doing more to keep F1 healthy?

    Caterham and Marussia seem like the tip of the iceberg to me. Sauber, Force India, and Lotus have all had money issues. Even Williams has struggled. Toro Rosso also seems tentative, although at least they’ve stayed in the pack. How can F1 think of itself as healthy when more than half the field is in real trouble?

    I’m not trying to be Chicken Little (the sky is falling), but there really do seem to be serious problems that can’t be ignored much longer.

  9. I used to be one of those people who said “F1 is the survival of the fittest, if you cant raise the money, you do not belong there in the first place, durr-durr”, but the apparent problems in recent years slowly but firmly turned me into a cost-cap supporter.

    It’s not necessarily the problem of F1, but its business model is not valid in the post-recession world. The perception of motor sports in general changed since.

    1. Back in the day that was probably a reasonable approach. However, there’s simply less liquid capital floating about out there and accordingly, there’s less available to form the basis of sponsorship. Firms will want maximum ROI and it’s harder to quantify that the GE Logo on a Caterham is raising the firm’s profile in the way the Santander logo does on the iconic Ferrari.

      A cost cap and/or reform of the profits of the F1 group so that there’s a more even distribution provides a more level playing field from a sporting perspective. It doesn’t mean the top teams can’t eke out an edge; it just means that it’s less an us them between front and back of the grid with a drying up midfield.

      So, yes, another supporter here whose view has change over time.

    2. It also doesn’t help when you have the promoter of the sport luring sponsors away from under the noses of teams, even big teams like McLaren.

  10. Hi Joe,
    As much as I think the suggestion of an equitable share of the profits for each team would be preferable to the multi-tier system we have today, it would not be without some pitfalls too I would imagine. One that springs to mind is that without a prize fund based on finishing position, are teams wholly incentifvised

  11. Max has always been the voice of reason in Formula One and it’s suprising the FIA are being so silent on this issue, after all Max recommended his successor.

    By the way, the ‘patrick’ who posted above is not me so should i now call myself patrick (the other patrick) ? 😉

  12. ^^oops. Fat fingers submitted my comment too soon.

    I was trying to ask if teams would be incentivised to push for higher positions if their revenue was unchanged?

    1. It doesn’t stop teams in the English Premier League where some of the prize fund is egalitarian and some is based on final finishing position.

  13. Mmmm…..Max is right here…F1 needs to have a team financial stress test to ensure that they have the funds in place to complete a season

  14. Both Mosley and Joe have completely wrong. It is exactly the so-called green engines that are bankrupting F1 (except for the top teams). Merc etc. are NOT charitable organizations that will spend untold sums on technology in order to subsidize the lesser teams. Merc owes it to its shareholders to be as profitable as possible.

    Rather, F1’s problem is to try to please the greens, and not allow ground-effects, the second major of expense of developing an F1 car. The solution is simple: Go back to normally aspirated motors with a set displacement capacity, and ground effects along the lines of early 1980’s cars. Be done with DRS, and complicated and expensive aero.

    1. So, a number of teams are in difficulties, and your solution is to throw away hundreds of millions of dollars in development costs with the new engines and get them to build some new ones? Yeah, that’ll be nice and cheap. Let’s hope that Mercedes and Ferrari don’t mind providing engines for Renault, who were quite insistent on having some semblance of relevance to their road cars.

      Likewise putting decades’ worth of aerodynamic knowledge aside in favour of ground effects: do you seriously think that a new aero war based on ground effects won’t be expensive? F1 needs stability.

      The majority of F1’s problems can be traced to money, and in particular the distribution of it and the sucking up of it by a bunch of short-termists in suits.

    2. I agree, greenies are never going to like motor racing, and the restrictions are stifling innovation, all the teams can do is faff about with wing tweaks.

      My rules (first draft):

      100 litres of fuel for the race
      Minimum weight of 500Kg
      Set maximum dimensions for the car
      Must pass today’s crash tests

      Hybrid? Turbocharged? Cylinder count? What ever *you* think is best!

      OK engineers, have at it! Compete!

      1. Gareth I totally agree. Sadly it wont happen but as a blueprint for competition at an Engineering level it is supreme: it pits contrasting technologies in a way that the best solution overall wins.

      2. Even better, let them use any fuel but with equal caloric value; diesel, petrol, alcohol, toluene, whatever. Here is the energy available – use it. It will never happen.

      3. I’m a greenie, and I’ve loved motor racing since my dad first tuned me into Bathurst, Brock and Moffat, at the age of 5 or so. Don’t blame F1s mess on people who think that a habitable environment should come before rampant greed. Indeed, as many have noted, the woes with F1 largely come down to greed at higher levels, unfair distribution of wealth, and short term gain over long term future proofing. It’s time to understand that there are limited resources, if we want to keep racing, which many of us support, we need to find smarter, more efficient ways of doing so. The latest engine formula is a step in that direction, not the cause of our current problems, which frankly have been developing for longer than a decade. Stop using motor sport discussion as a way of attacking greens and in turn, promoting or supporting outdated technologies. Ground effect – how are greenies responsible for the restrictions on ground effect? It’s not a green issue, fuel consumption might be, but ground effect, or even costs, aren’t green issues.

      4. Excellent rule-set, but I think that you’d also need a rule to specify that the car must be driven by an on-board pilot, otherwise the engineers will build a car driven by a computer in the pitlane (and probably one that will generate more G-load than a human can sustain)

      5. The optimum car will probably be running a multistaged supercharger, a complex ERS system and more active aerodynamics and suspension than you can shake a large stick at.

        It’ll also almost bankrupt the team that builds it but so dominate the opposition that all the other teams will be unable to attain reasonable funding.

        Not to mention it’ll travel much faster than today’s machines and therefore if ever something fails and it loses controls it’ll kills its driver and any nearby marshalls and civilians.

        This is clearly an exaggerated scenario, but it’s pretty much all the things which the current rules have been slowly designed to avoid.

      6. That’s the best way to burn up money. The manufacturers would spend a vast amount of money producing a tiny 3 or 4 cylinder engine, massively blown and having no relevance to road cars. In the mean time, they’d have spend a vast budget on every combination out there to see what was best.

    3. F1’s so-called green engines are silly but interesting. To make them efficient, you’d join them with an automatic transmission (no humans, please). And it would be very boring.

      When was the last last time an F1 driver pushed the engine, valves hitting pistons?

    4. @Oliver Antilla Would love to see ground effects of the the early 1980s on current F1 cars…Such a proposal was there before, if I’m not mistaken, but nothing came of it,,,

    5. It was Mercedes who wanted the green engines, because they have the most relevance to their road cars.

      The problem is not the green engines, the problem is that the fact that these engines- at the very cutting edge of technological advancement- are being advertised by BE and his cronies as like something out of a Massey Ferguson.

      F1 has always been about being at the cutting edge, and these engines truly are.

      Mercedes engines are significantly cheaper than the others, which makes me think Mercedes ARE subsidising these engines to their customers. They understand that they get the most prestige when their own car wins, but should a Williams or a McLaren also wins they get plenty of prestige and kudos.

    1. What are you both smoking? Hybrid “green” engines are the present and the future! Merc et al will spend heaps of money on technology i the can trickle it down to their road cars. A cap on costs to smaller teams would have meant that they invested less money in the First case. Merc Renault and Honda will be reselling the same tech to all the other manufacturers (look for ERS in Nissan/Infiniti).

      Ground effects did not guarantee brilliant racing (people need to stop watching highlight reels!) With no interest in developing technology, the manuacturers would leave (not necessarily a big loss) and we would go back to having lots o small teams who still couldn’t win and were underfunded; subsequently arriving and disappearing with regularity.

      Blind confidence …. What we call; Wrong and Strong!!

  15. I bumped into Max Mosley in the street a couple of years ago and told him I thought he did good things in F1.

    I agree with his statements today as well.

    I’m saddened that F1 has these inherent problems that have been created by Bernie Ecclestone. This is his creation, he is responsible for the financial structure and the fact that the rights are owned by faceless bankers.

    I used to respect him and loved the fact that F1 was getting bigger every year. I have been a fan since the 1980s. Now it is too big. Perhaps a real change is needed. Hopefully Bernie will go away soon and F1 can be run by someone who lives in the 21st Century, and wakes up to exciting ways to market this amazing sport, and actually grow the fan base!

  16. I wonder if Max Mosley happened to mention also what Ferrari brought to F1, currently and historically, and by the same token, Caterham’s contribution to same?

    Just asking

  17. I didn’t think much of Mosley until I read Adam Parr’s book, which detailed Mosley’s previous aborted attempts to cut costs. He does speak a lot of sense. At least, unlike his successor, he actually tried to do things. Todt is far too passive.

    1. Well, here’s what we don’t know about Todt… or at least what I don’t know about him anyway: Is he just being passive and feathering his own nest? Or, having witnessed others losing to Bernie, has he adopted a strategy of biding his time and sharpening his knives while he waits for the right moment?

      I don’t have a clue which it is… but I know which one I hope it is…

        1. OK, here’s another question that you might quite reasonably wish to ignore…

          As best I can imagine, your view of Todt’s stance and agenda likely is based on some combination of 3 things:

          1. Things you might know, or have heard, that you think it inappropriate to talk about;
          2. Your reading of the man and his character;
          3. Wish and hope, based on your reading of what the sport needs.

          Can you give a hint as to what percentages of each comprise your view?

  18. Saw the headline and thought the story was going to be a demolition piece about some nonsense rumour that Mercedes were going to start selling customer cars – some clever allusion of Joe’s to ” … won’t you buy me a Mercedes Benz …”

  19. I agree with him as well, it’s just a pity that all his sensible ideas were obscured by his egotism, paranoia and jealousy.

    1. Wouldn’t you be paranoid after being set up in a Chelsea basement sting! And for those who say he wasn’t set up, the people who set him up, covered up their tracks perfectly…

      1. No they didn’t. The person who did it got into trouble. It’s just that you didn’t hear about it. Anyway its irrelevant in F1 terms because it wasn’t an F1 story.

        1. Wow! That may not be an F1 story…. But it’s definitely *a story*. There were rumours at the time about F1 people setting up the sting, which *would* make it an F1 story… People can make their own conclusions, I’d better stop there!

      2. Possibly, yes, but I wasn’t referring to his Chelsea basement evenings, I was referring to his handling of the FIA and F1 in the latter part of his term.

  20. Joe, what are the chances of one or both being saved? I’ve read that you think Caterham would make more financial sense but would they get any FOM money for finishing 11th? I remember a dispute of a similar nature with Minardi when they finished 11th after Prost went bankrupt and then struggling to get Bernie to pay out?

    1. I don’t know what Joe thinks and I’ll not pretend to know anything like as much as he does, but as I understand it one of the fundamental problems that Marussia (née Manor) has is that the entrant itself has gone insolvent and so its entry may be recinded should the FIA so choose. As Caterham’s entrant, 1MRT, didn’t itself go insolvent (although is now under the control of the same administrators as the racing subcontractor) their entry is safe so long as they get a couple of cars to Abu Dhabi.

  21. Did Max take the day off when it was decided that Ferrari would take a huge cut off the top before the other teams got a look in? Didn’t he have any say in how the teams money is divided?

      1. Can the FIA can’t be involved in commercial decisions under their deal with the European Union? Only sporting decisions? I thought that the whole reason for the 100 year deal in the first place?

        1. This is an interesting point. The EU stepped in because these were abuses going on. It does however allow other governing bodies to run commercial operations, if there is no overlap in the decision-making. I see no problem in that.

  22. Is this the same Max who imposed an absurdly ridiculous fine on McLaren in attempts to cripple and/or bankrupt them over an infraction that was universally being practiced across the pit lane?

    Yeah, that Max, a reasonable kind of guy. A pox upon his house, or whichever subterranean den of iniquity he now frequents.

  23. Than what will be the point of fighting for the constructors championship if you’ll get the same amount of money for the 1st place as for the last place?

    1. I did not say there should be no difference. But the spread should be smaller and there should be no side deals.

    2. A legitimate answer would be “better TV exposure and therefore better sponsorship cash”. Another would be “do you honestly think that many people are in F1 just to pick up the paycheque?”.

      But even levelling the field a little would help. Take a look at the Premier League and you see a financial structure which, whilst often slated for the over-inflated wages and ludicrous ticket prices, does help to distribute income throughout the league. The financial gaps which do exist in top flight English football are mainly down to a) owner investment; b) development of commercial opportunities; c) TV rights for European football (which do have a stratifying effect on the league).

  24. Thanks for all the work on safety Max. A big no thank you for a 100 year term with the current promotor Max, why 100 years? No other offers at the time is not a good enough reason to sign such a ridiculous agreement.

    Lamenting spending cost caps for Teams seems a little odd considering – a gigantic part of the problem is an inequitable deal paying exorbitant commission to the current promotor for an outrageously long 100 yr term, a deal the hard negotiatating Mr Mosley was responsible for.

    How about a spending cap on the amount of money paid to the promotor, or doesn’t that suit the old boys club?

  25. Joe, I was wondering have you ever heard from any senior figures from teams (at any stage of your career) that your blog has ever changed their opinion? It seems hard to believe your wise words and you delivery of your opinion wouldn’t hit home to the most narrow minded of individuals?

  26. “Oh Lord won’t you buy me a Mercedes Benz (engine), my friends all drive Renaults, I must make ammends!”

    I know, it’s not new, I adapted an old Janis Joplin song from from the late sixties.

    Perhaps the wealthier members of the F1 fraternity should take off their rose tinted specs and look at financial reality? But no, it won’t happen.

    1. Everyone reads Joes blog… right Dennis?
      (“Dennis” was a Putin troll trying to explain to Joe that the US Grand Prix should be boycotted in a thread about Sochi a few days ago, Joe’s patience was awesome)

      1. That’s unfair. Dennis (wherever he is now) was a huge, lifelong F1 fan. He particularly supported Williams largely due to his respect for….Frank Head! Oops!

  27. Is this the same Max Mosley that gave away the FIA’s Commercial rights to a little bloke from South London who then onsold them a number of times beofre finally selling them to CVC who is milking F1 blind and indirectly responsible for the unfairly weighted prize money distribution?

    1. But cemented the FIA’s ownership of the sport at a time when that was in question. Better to have 100% of $300m than 100% of $0.

  28. I suspect that if the manufacturers had been required to cap their power unit supply costs at $4m for a season, Renault would not have been involved in F1 this time around. They seem to be trying their best to recover all of their costs quickly via engine supply contracts, whereas Mercedes appear to have spent a lot more money over a longer timeframe and are charging less money for power units. Ferrari also seem to be charging less than Renault.

  29. Joe as hard as it must be to agree with Max it is to your credit that you rightly acknowledge his worldly wisdom where it is due as in this case.

    Dieter Rencken in Autosport has been beating on about the financial inequality for some time – this anti-competitive behaviour must be resolved by the EU. If that turns F1 on its head, then so be it – but I would rather lose Ferrari and CVC than see this old boys club continue to rape the fans and the sponsors.

    F1 is a great sport and a great business: lets get it on a proper competitive basis.

  30. Max Mosley was always the ‘brains’ behind the operation. As much as Bernie has done, without Max to help him along F1 would never have grown to what it did. Quite ironic, now that Mr. Mosley isn’t involved F1 seems headed for its biggest crisis since the time when Ecclestone first seized control. Fascinating.

  31. Well, Max always was right about some things… it’s just that he was quite wrong about others… plus, he’s kinda creepy… no, make that very creepy…

  32. Mosley can make 100 statements and perhaps might be rational. This is the one.

    Next you’ll be fondly reminiscing about Jean-Marie Balestre.

  33. I agree, to a point. While I believe the revenues the sport generates should be more fairly distributed (and faceless financial entities should not be skimming 40?? Percent off the top) I think an even split between the teams with, as MM states, the motivation that success breeds attention and therefore more sponsors, is a good template. But I also think that there should be no reward for coming last? Turn up and earn is not a good business model for any multi million dollar enterprise! So, if there are 10 teams .. Even distribution between the top 9. If there are 8 . . . Well, you get the idea!! Thus allowing a turnover of bottom of the grid teams to graduate from lower formulae much in the way Soccer is run in the UK? (more on my template for single seater leagues and the need for a clearer path for drivers to progress later!)

  34. The other thing about a cost cap is, aside from just directly limiting the spending, surely it would help bring in sponsors. Let’s arbitrarily say a cap of 150mil is set. For the big teams they’re losing some of their spending advantage. For the smallest teams though, from what I keep seeing around, that’s more than they’re even spending now. But if a smaller team can say to their current or potential sponsors/investors/whatever, “We currently have x amount to play with. If you give us a bit more we’ll be that much closer to matching the budget of the biggest teams, and it’ll be your brand being broadcast all around the world when we’re running up near the front” …

    At the moment though… I mean, what’s the point of sponsoring say Marussia? Your 10 mil or whatever isn’t going to give them the edge to push to the front. All it’s really going to do is help in the fight against Caterham. A fight rarely ever shown on the feed. Who wants to hand money over to a team that basically has zero chance at getting anywhere? It’s not like the people at Marussia are all idiots with no idea what they’re doing, but when you’re talking about a 100mil or less budget versus the 300mil+ budgets of the big teams… it’s like mixed class racing, but without the matching results system. Chuck in another 10 mil… and you’re still on a completely different planet to the likes of RBR/Merc/etc. Chuck in 10 mil when every team’s spending is capped at 100 or 150 mil or whatever… well, there might actually be a point to that.

  35. F1 is f*cked , next year will be its last. back to watching indy car , were the focus is on the lead drivers wife for the last 4 laps , i weep ;-(

      1. Why a stupid post, look at the state of it. Crap engine noise , two teams gone bust , Force India just made by the skin of the teeth a engine payment ,Sauber no point no money for next year , Lotus ” the cheque in the post”. Viewing figures suck, attendance how many grandstands do we see full. Bernie shipping us of to crap tracks around the world. FIA toothless. Red bull will pull out if they finish in the lower half of the season next year.

        I love my F1 but man it’s getting more and more difficult not to fast forward to the last 5 laps. Can anyone say F1 has an exciting future?

        1. I can. I truly believe it and I think that anyone who does not believe that is being overly pessimistic. The world moves ever onward. People change. New ideas come along, but F1 is still an astonishing way to deliver messages around the world. It needs a few tweaks but in essence there is not much wrong with the sport.

    1. Absolutely. More so next year if Merc oppose engine thaw. It will become Formula Mercedes Benz unless Honda have come up with something different.

      1. For God’s sake don’t encourage idiot posts like this – English and grammar aside it’s also sexist. Good grief.

  36. It’s a pity that people with power can’t be so sensible. My stomach is flipping at the moment with all the failures. If Tony Fernandes can’t make it work, there’s something wrong….

    1. Very funny. The life of the Caterham team started in the court room and finished in the court room, is that really the way to make it work?

  37. Reading his quotes, I’m wondering how much influence Max Mosley still has within the FIA (for example buddies in the right places that owe him). Joe, do you have any ideas on this? Or has he cut his ties and retreated from his former life?

    I’m not suggesting that he’s planning a comeback, but I do agree with him on this matter and are curious if he has any superior motives when he gives those interviews. Or is this a true reflection of how he really feels about a subject that clearly means a lot to him.

  38. I seem to remember Indy / Champ cars have an engine cost limit in the 90s and a requirement for any new supplier to be prepared to supply 1/3rd of the grid which meant that when Honda came in and blew everyone away there was still plenty of competition as there was more than one team with that engine?

    A customer engine cost cap seems like an easy thing to police and sensible to introduce.

  39. I was working for LOLA at the time of tendering for the last four F1 franchises there was supposed to be a cost cap !!!! when LOLA missed out (not after spending a considerable amount of cash ) we were all rather pissed off, now LOLA is alas no more as are the four teams, this sort of thing cannot be allowed to go on F1 needs new blood to survive there MUST be a level playing field the big team seem to spend money because they can and the small teams go to the wall, at the cost of lots of jobs, F1 needs to wake up if it is to survive.

  40. I have to say that when I hear “spread the money around” all I can hear is socialism but perhaps this needs to be at least tried. Don’t take away the prize money but somehow make it possible for teams to at least having operating cost.

    BUT, this is the big but(t) of the conversation, we need an overhaul of the entire model called Formula One. I don’t mind paying for my ticket (I’m setting in a lawn chair here in Austin) but the promoters have to be able to make a buck. Bernie has to allow them to get track sponsors, naming sponsors ETC. so that the people putting on the race can make a living.

    1. > I have to say that when I hear “spread the money around”
      > all I can hear is socialism…

      Well, a big part of that is because the last decade or two in the US has featured increasingly strident and plain-wrong definitions of what socialism is. We’ve been bombarded by the bad, red-herring notion that anything that involves society putting limits on extremist raw capitalism is somehow socialism. But that’s just a lie, that’s not what socialism means.

      Socialism is the exact opposite of corporatism. They are mirror images of each other:

      * At the most basic level, socialism says, “Capitalism screws up everything, you can’t trust capitalists to run anything properly, doing that will make a mess of society, so you need to keep capitalists out of it and let government run what’s important.”

      * In contrast, corporatism says, “Government screws up everything, you can’t trust government to run anything properly, doing that will make a mess of society, so you need to keep government out of it and let business run what’s important.”

      The two statements are identical except they reverse how they refer to capitalist business vs government. Both are extremist ideas, both are black-and-white when reality is shades of gray, and neither one should be trusted.

      The problem in the US is that we’ve been having corporatists misrepresent what socialism really means. They do it as a tactic to make corporatism (which always goes by a different name) sound good, when it’s not good and never has been.

      In reality, “spreading the money around” does not mean socialism. Successful cartels (like most sports leagues, of which F1 is one), do it all the time. Decent societies also do it all the time. They’re nothing wrong with spreading the money around, it’s just a practical solution to many practical problems. But, like anything else people do, it can be done well or done stupidly, done too much or done too little. But it’s not socialism… unless you think several-billion-dollar enterprises like the NFL and MLB are socialist… which of course, they’re not… they’re a group of business guys making a fortune.

    2. To give a comparison, for last season the English Premier League gave the bottom team about 65% of what it gave the top team. For last season F1 gave the bottom team about 5% of what it gave the top team.

      The reality is that the top teams in the Premier League make much more money on sponsorship (and on revenue for playing continental competitions, for which F1 has no equivalent) but the minimum budget baseline is still there. In principle a Premier League team can guarantee about £65M in revenue even if their stadium remains empty and no-one buys their shirts.

  41. The problem is that those in charge keep doing the wrong thing.

    What I would do is:

    The cars:

    “Green” engines are fine, but the way they were marketed and the rules is what makes them suck.

    Max 100 liters of fuel per race, max boost on turbos to prevent too powerful engines, max amount of power you can get from the electric motors but no limit on the amount of energy you can store.

    Other than that it should be a free for all. Make whatever you think is best.

    Obviously this will be very expensive so more on that later.

    Just give everybody a FIA designed frontwing, rearwing and diffuser already. Current F1 aero is completely useless as they are spending giant amounts of money just to find tenths of seconds in a very restricted set of rules. There is no point.

    Cutting most aero expenses will obviously save the teams a lot of money but will also have some additional benefits:
    – FIA controls the design so they control cornering speed and therefore have control over safety.
    – Most likely downforce would drop quite a bit. This will make the cars harder to drive and challenge drivers more thus creating a betters show (sliding and spinning cars again!)
    – If properly designed might get rid of the need of DRS because of less dirty air and improved chances of overtaking.

    Obviously money should be shared more equally. I do think teams doing well deserve more money (after all F1 is not communism) but the difference should not be so big that it becomes impossible to compete with the teams above you.

    – Set a cost cap of 100million
    – Last years prize money totaled 750million so divided by 11 that is ~68 per team so lets say the 11th team gets 60 million and you get one million more per position. That would be the top team nets 70 million meaning the difference is only 10 million.
    – 30 ~ 40 million in sponsorship should be attainable I think. Even if a team can’t get that much sponsorship the difference in spending won’t be more than 40 million which shouldn’t create a huge performance gap.

    Engine development budget
    – Part of the money F1 generates should be given to teams/companies developing engines.
    – Limit engine development to 30 million a year. Lets say we aim for 4 engine manufactures this means 120 million spend on developing engines. With a little bit more money flowing in the sport the FIA could make a 80 million budget to divide between them. Again the best manufacturer should get more but not a lot more. So maybe 15 million for the worst engine and 25 for the best. Now force teams to sell engines for 5 million a year per team. Even if the worst engine would provide only 1 team this means they have to invest only 10 million of their own money each year to hit the budget cap. If you expend this to 5 or 6 manufactures by e.g. giving a little bit less to the other 4, meaning you’d be spending 10 ~ 20 million on developing engines could attract new manufactures as 10 to 20 million a year is not that much money.

  42. I understand how Joe feels; I feel that way when my local rag’s editor says something I agree with–happens maybe once a year.

  43. The numbers don’t lie. $1.8billion of income & the bottom team has to beg for $10m… Nor many businesses would be able to survive on that financial model given the size of the organisation you need to just turn up at each race.
    I don’t think a cost cap would ever work, but if like Max said ( & I can’t believe that I’m agreeing with him) the teams all started with a realistic payment from FOM of say $75m then I could see the smaller teams working their way up the field.

  44. Joe – what’s wrong with agreeing with Max?

    There is a way that third cars could work….. the third driver must be a lady.

  45. Good points Joe (and Max!). This is largely the way pro sports has gone in North America, with revenue sharing trickling from the high earning teams down to prop up the lesser teams, evening out the field much more and doing much to stabilise and secure teams/leagues. And while there are complaints about the system (‘socialisation’ of sport), it does make for a generally more competitive league, and a handful of teams can’t dominate for long periods like they used to, but well-run and successful teams still seem to gravitate to the top anyways (as they should).

    There’s just a little more flux in who those teams are, and success seems to move a round a bit more, which makes the sport stronger, more entertaining and a little more unpredictable. The more a team wins, the more they can demand higher ticket prices, sell more merchandise, etc, so winning DOES pay. And there’s limited ways around the revenue sharing and cost caps, with player singing bonuses, endorsement deals, arena corporate naming agreements, arena food/parking, etc, again, all things that can be used by a successful team to their advantage.

    Revenue sharing and cost caps aren’t a fully ‘socialized’ system of sports, but it gives everyone a fair starting point (was Marussia/Caterham/HRT EVER going to be able to remotely compete with Ferrari??), and success will be rewarded (to a moderate extent) in order to encourage the winners, but doesn’t allow for runaway domination, which is never good for any sport…

  46. Reports of the Death of F1 are greatly exaggerated. Reports of F1 having a nasty cold leading to flu which will need some emergency antibiotics are accurate. F1 will live, it’s immune system improved.

  47. Joe, Bernie has been a very sharp operator for a long time. I can’t imagine he would want his lifetime’s work to fail or lose significant value. And I can’t imagine he’d give up without a huge fight. From afar there seems to be a calculated reason behind most of what he does. My recollection is that when smaller teams have got into trouble he has thrown them a few bones – and encouraged others to do the same – to keep them going. A key issue is, in my view, why hasn’t he done anything to save Caterham and Marussia now? Do you have any knowledge or hunches on this question?

      1. Thanks for the reply but sorry it a bit cryptic for me. What’s the end game and the strategy to get there?

          1. “Look as soon as I left it all went to custard” type argument.

            Given nothing seems to have been done about succession (nothing is ever written about someone – or others – being groomed to take over) I’m not sure that’s a sustainable argument.

            And I guess the old Charles de Gaulle quote is always apt – “The graveyards are full of indispensable men.”

            BE seems a clever operator and clearly a very wealthy. I know nothing about him but I can’t imagine he would want to see his lifetime’s work and efforts disappear into a black hole.

          2. It would make him look good to the ignorant and to a few headline writers… but that wouldn’t last… (as I’m sure your book will help guarantee…)

  48. If more team(s) drop out – doesn’t the team value diminish. Eighteen car(s) is unacceptable to me. I prefer 24 cars.

    The CVC arrangement needs to be scuttled immediately by the FIA. I am sure there is some obscure clause in the contract that allows for it.

    If that doesn’t work – I would start a rival racing series in Europe.

  49. I disagree with all this support for Max Mosley. My memory is that there were far more credible entrants back in 2010, but they were rejected for not using Cosworth engines.

    This is only the tip of the iceberg for why I believe that Max was the worst thing that ever happened to F1.

  50. Jo,

    When Max Mosley bought in the new teams they were under the impression that it would be in an era of budget capping. That’s long since gone out of the window but it seems that most of the independent teams are struggling. It’s hard to imagine that the US entry for 2016 will fare any better.

    Many smaller race series have multiple classes in the same event. Has there ever been any thought about having an F1A and an F1B class. F1B would be budget restricted and have it’s own points and perhaps championships. Other than that it would operate the same rules eg cars would still need to be within 107%, aero regs and engine regs the same.

    It would incentivise the lower order teams and allow them to earn prize money that may keep them afloat but based on their performances from an equal footing. It may also mean that midfield teams could operate within budget and win the F1B championship as well as being middle of the pack in the main championship.

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