Mercedes splashed out over £300m on win­ning 2017 ti­tles

Autosport (UK) - - PIT + PADDOCK - ADAM COOPER

The Mercedes Formula 1 team spent an eye-wa­ter­ing £309.7mil­lion in 2017, a rise of £45.9m over the pre­ced­ing sea­son’s fig­ure, re­flect­ing the ex­tra R&D costs of de­vel­op­ing a car for the new rules.

The num­bers, which only re­flect the cost of the team and not en­gine de­vel­op­ment at HPP in Brix­worth, com­pare to the £263.8m spend of Mercedes’ 2016 cam­paign.

Only around £60m of the 2017 to­tal was ac­tu­ally paid by par­ent com­pany Daim­ler AG, in­di­cat­ing that Mercedes’ F1 cam­paign con­tin­ues to fare well for spon­sor­ship and prize-money rev­enue. Over­all turnover, which in­cludes F1 prize-money pay­ments, spon­sor­ship and mar­ket­ing rev­enue from Daim­ler, rose from £289.4m to £337.2m. A for­eign-ex­change gain also contributed to that in­crease.

Mercedes points out that its rev­enue has in­creased by 194% since 2012.

The Daim­ler mar­ket­ing rev­enue, a fig­ure that cov­ers the ben­e­fits the team cre­ated for the main brand, is listed in the ac­counts as £90.8m, al­though that cov­ers the com­bined pay­ments made in 2016 and ’17. Al­though there is no of­fi­cial split listed for the two years, it is un­der­stood to have been roughly £30m in ’16, and £60m in ’17 – as Daim­ler in­creased its pay­ment by £30m last year to in ef­fect ad­dress the ex­tra car-de­vel­op­ment costs.

In 2016 the team posted a loss of £3.8m, but that was im­pacted by a one-off tax pay­ment, and in ’17 it made a profit of £13.3m.

The fig­ures show that the team of­fi­cially paid £19.9m back to Daim­ler AG to cover the lease of en­gines for the sea­son.

The head count at Brack­ley in 2017 av­er­aged 912, up from 849 the pre­vi­ous year, which contributed to the wage bill ris­ing by £3.9m. Mercedes also points out that it en­joyed a 24.7% share of TV cov­er­age in 2017, rep­re­sent­ing an

AER (Ad­ver­tis­ing Value Equiv­a­lent) of £3.4bil­lion for its par­ent man­u­fac­turer and the team’s part­ners.

Co­in­ci­den­tally, Red Bull’s ac­counts for 2017 re­veal that the team’s spend­ing rose by the same per­cent­age – 17.4% – as Mercedes’ from the pre­vi­ous sea­son, in­creas­ing from £193.0m to £226.7m.

Team boss Chris­tian Horner told Au­tosport that the change to wider-track, high-down­force cars was in­stru­men­tal. “It’s as sim­ple as that, the cost of change in F1 is enor­mous,” he said. “You can see it will have an im­pact on all the teams. When you scrap a con­cept of reg­u­la­tions and have a change of the size that we had, it’s sig­nif­i­cant.”


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