F1 HEADS BEGIN WORK ON NEW PAY STRUCTURE
Bernie Ecclestone has begun work on a revised financial structure for Formula One, which will reward teams greater prizes based on their respective performance.
Under F1’s current financial agreement, which runs until 2020, the larger teams receive a greater share of the sport’s revenue, with many also receiving bonus payments.
Teams such as Ferrari and Williams receive heritage payments, with Ferrari’s being larger due to its longer stay in the world championship. Additionally Ferrari, Red Bull, Mclaren and Mercedes all receive bonuses for signing the current bilateral agreement.
Red Bull and Mercedes also receive extra cash, having negotiated bonuses off the back of their respective success in the Constructors’ Championship.
There have long been fears that the structure, which favours only the larger teams, is damaging for smaller outfits, with squads like Force India, Sauber and Manor increasingly vocal about the skewed structure.
Speaking to reporters in Austria, Ecclestone said he was working on a new payment system for teams, which would instead only pay out to squads who had earned the bonuses through performance.
Ecclestone said: “It’s going to be sorted out in a way where the chunk of money they get on top, they won’t get… well, they’ll get it if they win.
“We can’t pay the people if they are not winning and what I don’t want is to pay people what would effectively be start money. At the moment they [smaller teams] have no chance with this money that we give them. But we are going to make sure they are in a position where they do [have a chance] if they perform.
“We sort of look after – if that’s the right word – four or five teams [under the current bilateral contracts] because they have had a long-term commitment with us and they signed four or five years ago to stay until 2020. So they needed something for doing it.”
Ecclestone added that he believed Ferrari should retain an additional payment as it has been ever-present in the world championship.
Mercedes receives a bonus payment earned from winning two constructors’ titles. Team head Toto Wolff said: “Maybe the model Mercedes got in 2012 is a base for how it can be in the future. We got an additional prize fund because we performed. We got a hurdle built in: if you win those championships, you can increase your income.”
The new financial framework is expected to be ironed out this year and will come into effect in 2021. If a new structure were introduced earlier it would require all current teams to agree on the change.