Lewis Hamilton and Mercedes finally stopped the seemingly never ending dance around his future and have signed a to year deal which will take the British driver up to the next big F1 big regulation change. They announced new deals for both their drivers simultaneously although paddock talk suggests George Russell’s contract was signed and sealed several weeks ago.
Yet the casual observer could be forgiven for wondering why Lewis has spent a large part of his media time in Italy having a pop at the lack of quality Max Verstappen has faced from his team mates and sending ou the message loud and clear that this is not his final F contract. It’s almost as is Lewis is seeking to justify why the new arrangement was not for a longer period of time.
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When the dust settles it will become evident that Hamilton and in particular his financial advisors have in fact taken a bloody nose throughout this round of contract negotiations.
A report circulated in February this year leaked from Hamilton’s advisors revealed the opening gambit they were playing as the negotiations with Mercedes opened.
Sportune, a French sports business publication which recently revealed the valuations of each of the F1 competitors, stated that Hamilton was looking for a step up from his current €45m retainer. And given the fact that Mercedes were incapable of delivering him with a championship winning car his €25m bonus for becoming driver champion be converted into a guaranteed payment making his annual remuneration €70m euros.
Further, the report detailed that Hamilton believed he should become an brand ambassador for Mercedes and this arrangement would see him remunerated €25m a year for a decade.
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“Another 5 years”
Totted up, Lewis farewell payouts for his last hurrah in Formula One came to an eye watering €600m.
During the weekend of the 2022 Singapore Grand Prix, Toto Wolff revealed to Channel 4 the details of a recent conversation he and Lewis had.
“Just last week we sat down and he says ‘look, I have another five years in me, how do you see that?’”
When asked whether it was realistic to expect Lewis to continue until he was 43 as he would be at the end of five more years, Toto laughed citing the example of Alpine’s double world champion.
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“I don’t know if 40 is that age where you say that is not adequate anymore for a racing driver,” Wolff added.
“If you look at where Fernando is with 41 years, he’s still very much there. Now, is he the same Fernando that he was at 25? I don’t know, but he’s very competitive still.”
Hamilton followed this up a few weekends later at the US GP in Austin and suggested he was looking for a five year deal when asked how long he would continue racing.
“I have not a put a limit on it to be honest. I’m planning to do a multi-year deal with my team.
“I really don’t know what the next five years… I think we’re still trying to work on that. There are a lot of great things that are being put in place, like I just launched the production company this week, but I feel great in my mind and body,” he concluded.
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No multi-year deal for Hamilton
In Formula One, certain terms around driver contracts have specific meanings and whilst a ‘multi-year’ deal technically includes 2 years in duration, it almost always means much more in F1 land.
Both Lando Norris and Charles Leclerc’s five year contracts with their respective teams were recent examples of a “multi-year” deal.
So it appeared clear that Lewis intent for his final contract in F1 was to be longer than two years and hopefully for five he had repeatedly mentioned.
Hamilton then took a lie detector test on a feature for Sky F1 earlier this year and was asked whether he would stay in F1 until he won his record eight title. The answer he gave which the moderator indicated to be true, was “yes.”
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Of course given the cyclical nature of the sport, the next bug rule change comes in 2026 and is the realistic first opportunity that Red Bull can be overtaken. We saw this with Mercedes when the new V6 hybrid power units were introduced, but their dominance was for theist part of a decade.
Hamilton knows he has little hope of winning the drivers’ title in the next two years which ties in with his hope to continue racing for another five seasons.
So when Mercedes announced just a two year extension for their ‘star’ driver, it was somewhat a shock given all the water under the bridge over the past year.
When asked about Lewis’ new new deal by Sky F1, Toto Wolff joked “We already signed in May but didn’t tell anybody.”
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“We knew that we had an agreement on paper many weeks ago but you get lawyers o the case and they find stuff,” added the Mercedes boss more seriously.
“The combination with George who is still very early in his career is optimum. They push each other – they sometimes have different approaches to set up – and at there end the team benefits.”
Wolff denied he had spoken to any other drivers as the talks dragged on for months stating:
“I’ve always said when renewing [a contract] I don’t want to flirt outside. If I have a good relationship only when I see things are not going in the right direction then I would test the market, but I didn’t do it.”
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Why no five year deal for the GOAT?
Then Toto was forced to face the elephant in the room. Why had Mercedes not sought to tie Hamilton up to the end of his career and facilitate the five year deal he’d requested.
“It comes from both sides experiencing change in this age. This is a dynamic environment so signing a five year contract means you have to discuss any escape clause in case we’re not providing him with a car that’s not performing.
So we didn’t entertain that we said the foreseeable future is two years and that’s what we are committing to,” revealed Wolff.
Lewis new arrangement with Mercedes is believed to match that of Max Verstappen’s yet his €57m a year is a long way short of the expectations leaked from his management team.
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There is no brand ambassador role, which as this site has always said would be unlikely, given this requires the Mercedes auto manufacturer in Stuttgart to give board approval for the spend of €250m.
No five year deal suggests that Hamilton now has to prove he is worth his seat beyond 2025 and there can be no repeats of him being defeated by his team mate as was the case last season.
Martin Brundle noted Mercedes had chosen to allow both their drivers to become out of contract in 2025 which is unusual as F1 teams usually offset the expiry dates to ensure they can’t lose both drivers in a single season.
Wolff revealed the thinking behind this stating:
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“We have different structures of contracts because George has been with us since he was a junior driver.
“But I believe in the fact if its of benefit for both parties then you are staying together. We need to make a quick car with a quick driver.
“I do it like a very famous football coach once told me. If a good player wants to go elsewhere then he’s never stopped him.
“So if somebody wants to move either the team to the driver – then you’ve got to move.”
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‘Damp squib’ end to months of speculation
The entire Mercedes/Hamilton contract saga has finally come to an end, but it has to be said the announcement is something of a damp squib when compared to previous conclusions to negotiations between the parties.
Yet Hamilton is now in F1 for a guaranteed two more seasons given Wolff revealed there were no exit clauses based upon driver or car poor performance.
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*Goosebumps* every time 🥹 Flashing back to @Charles_Leclerc's amazing Monza victory in 2019
📽 x @F1#ItalianGP 🇮🇹 pic.twitter.com/ZK0ix2HEs5
— Scuderia Ferrari (@ScuderiaFerrari) August 30, 2023
