Christian Horner has been explaining his concern that the new Formula One financial regulations will create a brain drain from the sport with a “race to the bottom” over salaries The teams under the new cost cap rules must include all their employees salaries with the exception of the three highest paid members of staff.
However, teams are finding ways around this restriction which includes re-allocating employees to ‘other’ projects within the group. Most of the big F1 teams have non-F1 projects on the go with Mercedes’ Geoff Willis working with INEOS on an America’s cup challenger.
F1 teams ‘reallocate’ expensive staff
Red Bull’s Adrian Newey collaborated with Aston Martin road cars to develop the Valkyrie.
“The most single-minded hypercar ever to turn a wheel. Vast complication and compromise hand-in-hand with divine beauty and outlandish speed,” was Top Gear magazine’s conclusion on the Newey/Aston collaboration.
The F1 teams are billed for the hours spent on F1 projects by their ‘outsourced’ employees when they dip in and out of the F1 programme.
McLaren recently announced they had head hunted Red Bull’s senior employee Rob Marshall who will join their F1 team in 2024. Marshall has been working on ‘other’ projects recently for Red Bull but is thought to have a depth of knowledge around the new Red Bull Powertrains programme.
Horner’s astonishing claim about Marshall
Yet there are only so many ‘other’ projects senior members of the F1 teams can be reallocated to and Christian Horner believes this making it more difficult to retain personnel as they receive bigger offers from other teams. The Red Bull boss blames the cost cap for this employee merrygoround as it becomes impossible for match the big new offers employees receive.
“Yeah, of course it does,” he said. “You can’t carry anybody within the team. And I think that everybody has to warrant their place within the cap.
“Rob was as focused on other projects in recent years, and the offer that McLaren made is probably half their cap! So you can’t blame him for wanting to go and do that.”
This astonishing claim from Horner suggests Marshall’s salary but Aston Martin shares amounts to over $70m, around half of the cost cap.
“Race to the bottom” a concern
Yet in general terms Horner believes the salary spiral will be restricted for the few and there’s a danger that certain well paid members of staff could be replaced by several more cheaper newcomers.
“You have to make sure it’s not a race to the bottom,” he said.
“The problem is you have long-standing personnel that have contributed a significant amount that you don’t want to see forced out of their roles because of the cap, just because you can justify 10 youngsters versus an experienced hand.
“And that’s the constant debate that you that you have, and where we’ve had redundancies through the cap.
Wolff gloats over stolen Red Bull staffer
Prior to the opening race of this season, Mercedes announced they had head hunted Jane Poole who was Red Bull Racing’s Chief Operating Officer (COO) and HR director.
Her role was to evaluate the strengths and weaknesses of the current infrastructure at Mercedes and offer advice on where improvements could be made.
Toto Wolff gloated over the clandestine approaches that had secured the services of a top person from their arch rival.
“Jayne is a person that I admired over the last 10 years,” revealed the Mercedes’ boss.
“Her role at Red Bull was, in my opinion, a very large part of the success of the team over the last years.”
Ex-boss knows who’s who at Red Bull
Wolff believes Poole is a key person for the Mercedes team who are trying to rebuild their organisation following a number of high profile departures.
“She has seen another organisation,” adds Wolff. “She knows everybody pretty much, and she has created forensic profiles of all of the good people in Formula 1. Having her eyes is a very, very strong edge to the organisation.”
Of course from her HR brief, Poole will have the names of Red Bull personnel who are key to the organisation but otherwise fly under the radar of the competitors.
FIA must ensure cost cap legitimacy
Christian Horner however present s the departure of his COO in a different light.
“Jayne Poole was one of those as well. She was a redundancy that we made because we couldn’t justify a role within the cap.”
The matter for the FIA to consider in all this is whether teams are in fact hiding spend in ‘other’ projects that are in reality a significant part of the Formula One operation.
If this is the case, it makes a mockery of the financial regulations and cost cap which is designed to level the playing field and bring the historically less well funded teams closer to the front of the grid.
Who could ever forget this iconic Sebastian Vettel moment in Canada?! 😂
— Formula 1 (@F1) June 13, 2023