F1 Budget cap: 2yrs we will be at 1200bhp, will fans be happier because of it?

ferrari-turbo-f1-80s
Budget caps have become some sort of an item lately. It has passed my mind for years, and I even tried to gauge your thoughts about it in my article “La revolucion”.

Liberty Media is interested to learn how think can be kept financially feasible for the future. Ferrari-boss Marchionne commented on it that it wouldn’t be possible.

A couple of years ago, Max Mosley did some work on the possibilities of budget caps. His idea was to give total liberty in anything else, as long as they would agree to a cap.

Mosley stated They [the teams] would realise that for 100 million [dollars] you could have great motorsport and build technically advanced cars.

In 2009 FIA stated in relation to bringing down cost: “Two main philosophies have emerged, either i) reduce activity levels through very restrictive technical rules, plus a degree of standardisation if required; or ii) restrict the money that teams are allowed to spend (cost capping). The FIA believes that unfettered technical competition is part of Formula 1’s DNA, and would like to see this flourish, but in an environment of strong, responsible and innovative management, not a spending race. For these reasons cost capping is preferred.”

It is a major issue that the more time passes, the more teams sink money into their efforts. If the sport cannot regulate itself, will it compete itself to death?

New owners Liberty Media has put forward some of their ideas more and better of social and other digital media, more races, increased sponsoring (!) and finding new markets for the sport to grow.

The question I already asked in “la revolucion” was: will it be more entertaining? Will faster cars make the sport more fun to watch? Will a 3 layered front wing which optimises air flow 5,4% better than before and cost 15M USD make a fan watch longer or more often? Will a 400 Km/H car (GPDA’s Alexander Wurz’ idea) be more interesting to watch than a 350 Km/H car?

I suspect that FIA already knows the answer. We went from V12’s, to V10’s (that sound!!!), to V8’s and now V6 turbo’s. All in an effort to keep power down, and drive manufacturers to think about fuel economy (in an effort to keep F1 connected to the real world?). What is next? Inline 4’s?

Oops, been there, done that. Inline 4’s were the bhp 1000+ monsters from they 80-ies. They were extremely powerful, and sucked gas like, well, uh,, somebody badly in need of a drink.

vortex_in_fluid

FIA saw this development track as a dead-end and changed engine regulations.

FIA has been changing regulations to keep manufacturers on the move. The last time FIA changed the rules, all manufacturers were complaining about the cost. Obviously this is ridiculous, in the sense that they themselves set the budget for engine development. If it is too expensive, then don’t do it. “Oh yes, but then we might have a possibility to not have the most powerful engine”, well duh… with that kind of reasoning you will always spend to the max and beyond, and it will always be too expensive.

2017 engines will see another rise in power, bordering on the 1000 bhp. If FIA doesn’t limit things, in 2 years time we will be around 1200bhp. Will F1 fans be happier because of it?

More power means more speed, more speed means that cars will pass the straights even faster. Faster means less time to overtake! If a circuit straight take 10 seconds today, it could take 8 seconds tomorrow, obliterating any chances to do a slipstream. No slipstream, no overtaking: a long parade of really fast cars. Or would we then ask FIA to lengthen the straights and enlarge circuits? Is this line of thought really that awkward? What is it that we want?

And then there is the difference between the front- and the back end of the field. The top 4 has enormous budgets, the privateers have a bad time. Manor, a company that has been racing cars for years, is threatening to go belly-up since it can no longer afford F1. It can’t be their racing hearts, because they do love racing.

IMHO there is just a single solution: a budget cap. Teams really shouldn’t be needing 400 M USD per year. Yes, F1 is hugely popular. Yes, people buy a Mercedes because they saw a Mercedes win at a Grand Prix, and yes, people do drink Red Bull because it is hip and it is fast. But some realism should be put in place as well. The combined 2015 budget of all teams amounted up to 2,7 B USD! (Bruznic: tnx for the numbers!) Imagine what 2.7 B USD do for a development country, world hunger, and if you don’t care about other people dying, for the Mars One project? I might be a little crude here, and even I don’t want to go without F1, but all F1 is in the end is entertainment. This is why I started asking the question: will all this money make F1 more fun to watch?

It is clear teams are not ready for budget caps. Discussions lead to teams threatening to start their own championship in 2009. But times are changing. Would new ownership be the trigger to help put new ideas in motion?

Liberty will put in around 8 B USD to buy F1. They are a corporation with a financial target. They want to see a return on investment. A 10% return would be optimistic, but 5% would be low. No wonder they are looking for ways to stop this money-guzzling.

Marchionne’s remarks that it wouldn’t be possible are mainly driven by the (historically correct) assumption that teams would only find new ways of circumventing budget regulations. It is a bit like to Russian doping scandal: as long as you get away with it, it is accepted. As long as people don’t know, nobody notices the difference.

F1 itself has seen this kind of reconnoitring of limits many times: BAR with it’s hidden fuel tanks, Renault asking Piquet to crash his car into the barriers, McLaren looking at Ferrari designs during spygate, even Michael Schumacher parking his Ferrari at the Rascasse corner in Monaco. One might debate whether things are legal when looking at the rule-book. However, we all know this is not the sportsmanship we want to see.

F1 teams need to take a long look in the mirror. Yes, there are ways to cheat, and cheaters can probably dominate the sport for years. However, it should mean financial suicide when the world finds out. F1 fans are not looking for the best spreadsheet jockeys, F1 fans are not about worshipping the best tax-avoiders either.

Maybe I am only talking for myself (and do leave a message below if that is the case) but I like the drama of people, teams and cars failing, surcoming and winning. There needs to be a bit of drama. Teams do not need 600 people to create drama, teams should not need 400M USD to be a a real championship contender. Too many people involved, too much money flowing: there is no more room for drama and excitement.

A budget cap would bring it all back. Support “la revolucion”..

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18 responses to “F1 Budget cap: 2yrs we will be at 1200bhp, will fans be happier because of it?

  1. 1 thing, amongst many, it wasnt four cylinder engines in the 80’s turbo era that produced over 1,000bhp. They all did.
    The four cylinder was the BMW engine but Honda, Renault, Ford and Ferrari all ran with 1.5l V6 powerplants.
    The 4 and 6 cylinder designs all produced over 1,000bhp in qualifying trim. In fact, with qualifying fuel and boost pressure turned right up they were hitting figures of 1,450bhp.

    As to Mercedes selling vehicles because of F1 success. This is something that truly annoys. Are you and every blinkered writer suggesting that without F1 Mercedes would crumble in losses?
    If that were so, why is BMW and Audi not racing to join the F1 ranks – their sales must be shocking!!
    Its the same argument that people like CSJ put forward about Ferrari.
    Ferrari’s biggest market is America. Fact. Yet something strange happens in the states. They currently dont follow F1 so how can Ferrari use F1 as advertising? Shock horror.

    Their heritage of Le Mans and sportscar racing plus their long history of building legendary sportscars like the 250LM, the Testarossa or possibly the P4 is what makes Ferrari iconic.

    Porsche has no ptescence in F1 yet Ive not heard Stuttgart panicking about F1.

    Some perspective much needed I feel.

  2. I think you have a valid arguement. Set a maximum size an F1 car can be, set the safety standards and set the budget – then stand back and let them go! I purposely did not say set the engine size, yes there should be some standards, but as someone who has watched F1 since the 1960s,

    I remember cars with Gas-turbine engines, 4-wheel drive, 4 wheels at the front (Tyrell) and 4 wheels at the back (March). Now I don’t want to turn F1 into Wacky Races, but freeing up designers and engineers to experiment more leads to innovation and breakthroughs, it also makes the cars more interesting as they could be very different from one another rather than the clones we have today.

    The one power unit system I did not mention is electric. As Formula E improves then at some point an electric F1 car could be viable. People would then complain about the noise or lack of it! But I for one think that it would be an important milestone not just for F1, but for manufacturers, climate change and many other areas not related to F1.

  3. Liberty will put in around 8 B USD to buy F1. They are a corporation with a financial target. They want to see a return on investment. A 10% return would be optimistic, but 5% would be low. No wonder they are looking for ways to stop this money-guzzling.

    Oh do please explain how a budget cap increases Liberty Media’s profits. Other than Liberty paying the teams less there is no correlation between F1’s team budgets and Liberty’s return on investment. And don’t use the argument that high team budgets equal success. Toyota and Honda put that to bed.

    • The CVC receives the television rights. Teams get a share from these rights. If teams push less heavily on CVC, then the surplus will go to Liberty.
      High budget does not have to mean success, but low budget excludes it.

      • CVC gets a lot more than TV rights. As an example. They screwed the promoters who no longer get a dime from track ads. So in other words – for Liberty to make money the teams have to accept less. And what happens if the teams say no?

  4. What surprises me is that nobody answers the real question “are high budgets making the sport more attractive?”

    • Nope. Not really.

      The money involved does engender a certain scale of operation, a base level of interestingness.

      Mostly the numbers just sound impressive but beyond that, no effect.

  5. F1 is morphing into WWE – more focussed on the look than authenticity. Shallow, in a word. Does Liberty have links into that US pro-wrestling world that will accelerate the change? I hope not.

    The ‘racing’ part of the F1 exercise is the authenic part, we need more of that. The colour / look is just advertising or an amplifier. You can amplify zero as much as you like – it”s still zero.

    The intrinsic value of any endeavour is indicated by what would happen if sponsor money disappeared. Would people still do it? Hmmmm.. F1? Nope. Yet the whole industry seems to genuinely believe otherwise.

    • I’d rather see F1 morph into the WWF, where there were no rules. The WWE and F1 today are so tightly controlled, you’ll always know the winner of the match or race. History in F1 has proven that the longer you keep a given set of car regulations in racing, the easier it is for the teams at the bottom to catch up and become more competitive. Almost everytime dramatic rule changes have happened, with exceptions like 2009 with Braun, the teams with the biggest budgets always flourish.
      And if you’re not down with that, I got two words for ya: SUCK IT!

    • I surely don’t want to make F1 into some kind of other Indycart. However, I haven’t bought any of that “we are doing F1 to develop technologies for our roadcars” BS for years. That kinda stopped in the 90-ies. What technologies have been developped that made it to cars later? Nothing that wouldn’t have made it without F1. International law is more defining what is happening in the automotive industry than F1.
      So in some way or form, we have to admit F1 is entertainment. It’s authenticity is found in the effort teams put in, the characters in the sport and the history the series has.

      For the larger teams, it is just a money-circus. The ONLY point I would like to get firmly across, is that we can see a same spectacle, even if teams would NOT have a 400M USD/year budget.
      F1 has nothing to do with the real world. Neither has professional soccer, football, basketball, tennis. It is just a sport. Any professional sport is a spectator game. No spectators, no game.
      People complain about rules: if tennis wouldn’t have any lines on the field, what would be the point?

      If you want unbridled, pure, no regulations development: look at the race for Mars, research against disease, the advance of AI and robotics.

  6. first off. name yer greatest/grandest/most fav circuits in the World for the last 2 to 5 decades. second off, explain to all how F1 exists without PAYING to race these circuits?? Bernie n F1 n FIA would NEVER race on my awesome track without paying ME who has the total responsibility for being viable in the biz world!!! as an owner/operator/promoter with ALL the marbles on deck, CVS/Bernie/Liberty would likely not survive living for 10 minutes of my valuable time!!
    NOW, this 2017 rules package is likely to be the singular worst EVER conceived:
    shorter races
    see yer heros n fav teams for fewer minutes
    harder to discern each car n driver as they approach n pass yer viewing point
    sponsors get less exposure – PERIOD!!!
    longer/wider/heavier cars
    more difficult to pass – unless a “dive bomb” is considered appropriate
    less manueverable in RACING conditions
    possibly more likely to toss a wing n chards of carbon fiber
    overtaking
    slower top speeds/higher cornering speeds/much shorter braking distances
    yeah. gonna improve the show massively 😦
    less front wing disturbance from ground effects, but more front wing disturbance from lower and wider rear wing…
    LMFAO!!
    pit stops
    bigger n heavier tire/wheel combos mean NO more 2 sec pit stops – if anybody actually gives a crap 🙂 haha
    maybe we need the ROCK n HULK to dis-enfranchise the idiocy of F1 LOL
    Liberty is CVS on steroids.
    they could ALMOST suck my Frigging Ass if i were so inclined…

    God save the Queen. God save America. God save F1…

    r these M******F******g idiot retard engineers even worthy of existing??

    I suggest the engineers and marketing retards r ALL frigging ignorant beyond responsibility. IMHO, of course…

  7. Budgets are just another attempt to install more restrictive rules and regulations to a sport which already stifles innovation and positivity. That’s why F1 IS NO LONGER THE PINNACLE OF MOTORSPORT, it’s just another sanitised series which only exists for testing road car technology. Most of which never makes it to an assembly line!
    Brilliant, positive minds utilising the freedom of absolute autonomy to create automotive innovation in F1 have now been replaced by puppets with a negative mindset of highly restrictive tunnel-vision. Instead of concentrating on innovation and creation, the current environment is causing them to concentrate on exploiting a myriad of highly claustrophobic rules and regulations. Sounds more like trying to find a needle in a haystack! We might as well put those free-spirited, innovative engineers & brilliant boffins in straight jackets and play loud, repetitive music to them in a 4ft square padded cell.
    That’s what F1 has been reduced to by the self serving road car manufacturers and their richly rewarded ‘friends’ at the FIA.
    For the sake of the argument, let’s forget about motorsport in general. Forget about the FIA’s agenda and the selfish road car manufacturer’s mandates for a minute. Let’s concentrate on F1 as a separate entity altogether. After all, that’s what it is, totally different!
    If we truly want what’s best for F1 … the only way to get there is to open up the rules, regs and budgets completely. Otherwise it’s just an insipid, watered down, pathetic excuse for a series, one where major manufacturers call the shots with the assistance of the FIA to whom they pay a kings ransom for membership. One where the rules keep getting broken so the FIA keeps changing them to stop the teams finding loopholes. Fewer rules means fewer loopholes. Fewer restrictions means less looking for loopholes and much more innovation.
    You can not have it both ways at the pinnacle of anything in this world. You cannot be the pinnacle at the same time as being over-regulated and under-funded, it’s counter-intuitive nonsense which is impossible to manage fairly between the richest and the poorest competitors.
    To restrict F1 in any way means it is not the pinnacle, it is contrived … it’s just a bigger sized reflection of smaller categories. F1 is now just another tiresome, restricted formula which only serves the big manufacturer teams and one well funded privateer like Red Bull. These tams work to a billion dollar business plan every 3 years. Do away with the restrictions and allow open budgets. Then you attract more billionaires and more boffins to the series. That inturn attracts more players from other industries where these concepts can be utilised and manufacturers of those components. It’s a snowball effect that grows with every new idea.
    Billionaires and boffins work on their concepts in secret because they don’t want to be told what, when, where or how to achieve their goals. Make no mistake, there are PLENTY OF THEM out there … they just don’t want anything to do with conforming to other people’s rules and regulations so they keep to themselves. If they do want to test, develop and market their new technologies in F1, they need a platform where they are given an open rule book and they’re allowed to use their marketing budget as they see fit.
    Only then will they return with confidence to F1, the place where amazing technological breakthroughs were achieved and marketed to a global audience throughout the glory days … a time when anything was possible.
    No billionaire or uber-funded boffin worth his salt wants to work within a restrictive environment where they achieve mediocrity. By opening the doors and setting their minds free, they are free to create the next big breakthrough. It’s human nature! It’s how we’ve gotten to where we are now.
    Without those unfettered working conditions during the glory days of the industrial age, we may not have discovered half of the technological breakthroughs we have today … or the thousands of wonderful spin-offs and partner technologies which have come along with them.

    As for back marker teams who can’t afford to keep up … that situation exists because they’ve been strangled to death by ludicrous rules and regulations which don’t allow their engineers to try different avenues. Clever innovation which could be achieved within their budgets if they were allowed the scope to do so.
    It’s like continuously competing in the same pool, with the same swimming stroke, against the same world record holders, from the same superpower nations who’ve spent billions perfecting their strength and skills to “the nth degree”. It’s impossible to beat them at their own game. Eventually it becomes a hopeless, negative environment to perform in so they pack up and leave in disgust and despair.
    I firmly believe the only way forwards for smaller F1 teams is to have an environment where they are uninhibited and not restricted by having to use that same “swimming stroke”. Let them use their smaller budget on anything their brilliant engineers can conjure up, anything that makes them competitive. Allow them to create their own innovative style. Give them a positive point of difference, which in turn is giving them REAL HOPE and a reason to get up in the morning.
    At least they’ll enjoy the opportunity to shine bright in short bursts and celebrate their fifteen minutes of fame when it pops up every now and then. At present, they simply have no hope of success at all.
    We all know the current playing field only suits the big budget teams. It will remain this way as long as we have a mind numbingly restrictive rule book which can only be exploited by spending 200 million dollars on perfecting the most minute details. Crazy thing is, instead of pushing the boundaries of innovation and creativity, it has created a copycat mentality where those tiny details are hastily copied by the next guy in a jealous, feverish bid to keep up with the Jones’. They didn’t go through an exhaustive design, R&D process to make it. They have no idea how to utilise that expensive modification properly, or marry it to their existing chassis/engine, because it wasn’t designed for their car in the first place. There’s no science to it whatsoever. It’s the old blind-faith, “hit ‘n’ hope”, “lets hope we get lucky” scenario which almost always turns out to be a total waste of precious funds from their already slim budget.

  8. Keep saying: limit the amount of joules per race and give total engine freedom – nuclear, solar, batteries, fossil fuel etc
    This would attract all kinds of companies and create new interest in the sport. If you distribute the money more evenly…
    Scrap that !

    It should be the other way around: give the winner no money and build up to last place but make the difference between ninth, tenth and eleventh small, so there’s no real incentive to loose.
    Winners attract sponsors so I think this way you solve it all

    • I always like how you think. Up until nuclear. Then you went over my head. Brilliant! Hahah. People gave me a look. Wtf are you laughing about? Oh nothing. F1. Never mind.
      Hahaha.
      But anyway I agree. Look at WEC. engine freedom, kind of. And what did we get in 2016?
      Audi with a hybrid turbocharged diesel 4.0-liter V-6, in the 6 MJ class.
      Porsche with a hybrid turbocharged petrol 2.0-liter V-4, in the 8 MJ class.
      Toyota with a hybrid twin-turbocharged petrol 2.4-liter V-6, in the 8 MJ class.
      This means audi has less electrical energy recovery but is allowed to use more feul.
      All 3 of them opt for a “normal” engine for power on the rear wheels and an electrical engine for the front wheels. This giving them a combined power range of +900 bhp. Some even claiming +1000bhp (Toyota). And what’s more the racing is fierce! Lmp1 is on this high now for a couple of years. And if it wouldn’t been for the VW scandal 2017 would have been even better. Why the hell can the FIA make one class so amazing and fuck up the other class so much?

  9. In other news, Bernie Eccleston and Brian France have decided to swap positions stating that both have exhausted ideas how to fuck up their respective series.

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