GLIMPSE OF THE FUTURE
03
Uncertainty over engines is not only occupying the minds of those at Red Bull, it is also central to discussions over the future of Formula 1 itself.
The sport’s governing body, the FIA, have set an end of May deadine to resolve the debate over the engine rules from the 2021 season. On 17 April, the FIA issued a statement re-iterating their desire to remove the MGU-H from 2021. This is the part of the hybrid system that recovers energy from the turbo. While it allows the
“IF THERE ARE ANY PROPOSALS THAT DISTORT F1, I THINK FERRARI WILL PULL OUT Sergio Marchionne
current F1 engines to have revolutionary levels of efficiency, it is also expensive, complex, blamed for much of the current disparity between engines, and responsible to a large extent for their muted sound.
The four engine manufacturers wrote to the FIA before the season saying they wanted to keep the MGU-H. But insiders say that when its removal was proposed by the FIA at a meeting of the strategy group of leading teams, F1 and the FIA on the 17th, no one really objected.
As such, the MGU-H is regarded as part of a negotiating position by the leading teams in the wider debate about F1 post-2021 – namely on the revenue split, cost control and technical rules (see James Allen column page 29).
F1’s commercial rights holders Liberty Media made a presentation to the teams at the Bahrain GP on how they wanted to restructure the sport. This included a $150m budget cap and a more equitable distribution of prize money between the teams as part of a desire to ensure, as it was described in an F1 statement, that “how you spend the money must be more decisive and important than how much money you spend”. Among changes planned are more standard parts – on items such as gear ratios and brake ducts, believed to be of minimal importance to the public.
Reaction from the teams has been muted, not least because all had to sign a confidentiality agreement at the meeting. Mercedes F1 boss Toto Wolff described it as “a good starting point for discussions”, while Ferrari chairman Sergio Marchionne said: “We are working with Liberty Media to find acceptable solutions”, but repeated his threat that “if there are any proposals that distort F1, I think Ferrari will pull out” (see cover story, page 36).
Despite the confidentiality, some details have leaked out, and Ferrari are the team most affected by the proposed prize money changes. Liberty have suggested cutting the bonus they currently receive for their historic value to the sport from about $100m to $40m. Ferrari would receive the $10m bonus proposed for all engine manufacturers on top of that.
The prize money split between the teams has not been revealed. But sources say the proposed new structure mirrors the current one: a prize fund split into two chunks or ‘columns’, one paid out in an even division between the 10 teams; the other based on performance in the previous season. However, the gaps between the teams in what is known as ‘column two’ are much reduced.
There is also a proposed change to the overall income split of F1. Currently, the teams receive 67.5 per cent of the pot and F1 the rest. Under the new proposal, if income is about what it is now – $1.5bn – that split remains similar. If income goes down, the teams get a greater percentage; if it goes up, the teams’ percentage is smaller.
In other words, Liberty are effectively proposing ringfencing a ballpark figure for the teams of about what they earn in total as a body now, while Formula 1 will not only take on the risk of any drop in revenue, but also benefit more from any rise.