Is this the end for some F1 teams?

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Option or Prime
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Is this the end for some F1 teams?

Post by Option or Prime »

With no Grand Prix raced and the calendar likely to be further altered it not surprising that Zac Brown fears for some of the teams in F1 Zac Brown fears for some of the teams in F1

There were already questions about some teams carrying on, how many teams would have to go to put the whole of F1 in jeopardy? Are Liberty flush with enough money to weather the financial storm in the states?

Paolo_Lasardi
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Re: Is this the end for some F1 teams?

Post by Paolo_Lasardi »

If we had a healthy grid of 12-15 teams - no problem.

Option or Prime
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Re: Is this the end for some F1 teams?

Post by Option or Prime »

Paolo_Lasardi wrote:If we had a healthy grid of 12-15 teams - no problem.
We've only got 10 now !

KingVoid
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Re: Is this the end for some F1 teams?

Post by KingVoid »

I’ve never experienced anything less than 10 teams in Formula 1 and I don’t really want to.

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Flash2k11
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Re: Is this the end for some F1 teams?

Post by Flash2k11 »

The only team i'd be really fearing for is probably Williams, the rest of them have backers who, if they are so inclined, have enough money floating about to keep their teams afloat. I do wonder if Gene Haas is weighing up his options though.... Racing Point should be fine, Stroll Sr and the gang are clearly betting a lot on the Aston Martin name so I think they will be about come what may next year. Renault may see this as a good exit strategy, but given that they have been building towards the next set of regs (and spent a lot of money on what that entails) I cant see them going either. McLaren have enough cash in hand to weather one failed season, and the rest of them all have a manufacturer (or Red Bull) behind them.

If this was the days of Minardi/Forti/Arrows et al i'd be expecting way more teams going to the wall.... as it is I dont think we are going to lose anyone.
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Paolo_Lasardi
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Re: Is this the end for some F1 teams?

Post by Paolo_Lasardi »

Option or Prime wrote:
Paolo_Lasardi wrote:If we had a healthy grid of 12-15 teams - no problem.
We've only got 10 now !
I know - hence the if.

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Re: Is this the end for some F1 teams?

Post by Paolo_Lasardi »

Flash2k11 wrote:The only team i'd be really fearing for is probably Williams, the rest of them have backers who, if they are so inclined, have enough money floating about to keep their teams afloat. I do wonder if Gene Haas is weighing up his options though.... Racing Point should be fine, Stroll Sr and the gang are clearly betting a lot on the Aston Martin name so I think they will be about come what may next year. Renault may see this as a good exit strategy, but given that they have been building towards the next set of regs (and spent a lot of money on what that entails) I cant see them going either. McLaren have enough cash in hand to weather one failed season, and the rest of them all have a manufacturer (or Red Bull) behind them.

If this was the days of Minardi/Forti/Arrows et al i'd be expecting way more teams going to the wall.... as it is I dont think we are going to lose anyone.
Williams, Haas and Alfa Romeo/Sauber are all on critical finances afaik (Aston Martin as well, but I am not sure that would effect Stroll F1). Alfa may be abandoned as a brand altogether, not only in F1. If they go and either of Renault, Red Bull, Mercedes, Ferrari pulls out - then goodbye ...

Maybe Stroll senior will actually get the wdc for his son, before F1 crumbles and FE takes over. ;)

But probably, we are back to normal in 2021.

Harpo
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Re: Is this the end for some F1 teams?

Post by Harpo »

May be it will not be the end for some (my take is rather "a lot" that "some"), but certainly it's the end of F1 as it grew during the last (insert your number - mine is around 20) years. From motor sport to over inflated greedy show business...
From the coronavirus thread :
"if F1 wants to survive 2020, they can't, and won't be able to, go on playing with the obscene amounts of money they used to wallow in..."
" Except may be Ferrari, Mercedes, and Red Bull, no racing team (and it's even more obvious in other series) can survive a long stop without a complete reshuffle of the "business" model. And this concerns other sports (ie football...) whose economic model is a headlong rush giving the illusion it's sound, as long as there is no stopping in the process."
As my brother said : "I've got the brain of a four year old. I'll bet he was glad to be rid of it".

Option or Prime
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Re: Is this the end for some F1 teams?

Post by Option or Prime »

The F1 teams are holding a meeting today to discuss the already reduced cap on expenditure, how much further can you do that before having standardised parts?

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Re: Is this the end for some F1 teams?

Post by j man »

Way back in 1952 and 53 they ran the championship to Formula 2 regulations due to a shortage of teams able to field Formula 1 cars. If multiple teams do go to the wall due to the current crisis, it could be a possible temporary solution to keep the sport going. Have them use spec F2 cars for a couple of years until things recover. I'd rather that than have three-car teams with the general lack of racing that occurs between team mates.

Then again with the much closer competition that would create, I doubt anyone would want to go back to the old rules...

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Re: Is this the end for some F1 teams?

Post by Siao7 »

j man wrote:Way back in 1952 and 53 they ran the championship to Formula 2 regulations due to a shortage of teams able to field Formula 1 cars. If multiple teams do go to the wall due to the current crisis, it could be a possible temporary solution to keep the sport going. Have them use spec F2 cars for a couple of years until things recover. I'd rather that than have three-car teams with the general lack of racing that occurs between team mates.

Then again with the much closer competition that would create, I doubt anyone would want to go back to the old rules...
Not sure this would work, F2 is a "spec" series, isn't it? Just too many differences with F1 to try this.

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Re: Is this the end for some F1 teams?

Post by Zazu »

Esports is going to overtake motorsport. I used to think it would take a decade or so, now I think it will be in the next couple of years.

Going to be worse than 2008 for finding sponsors now. Car manufacturers going to find it hard to justify spending millions on F1 when they're not selling cars. Cant see how Renault can possibly continue when unemployment in France is going to go through the roof

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Re: Is this the end for some F1 teams?

Post by Option or Prime »

Outcome of the meeting today.

Teams had already agreed to reduce the original $175m cap in 2021 to $150m as a result of financial problems caused for F1 by coronavirus.

But at the meeting, the top three teams pushed back on a proposal to reduce the cap further to $125m

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Re: Is this the end for some F1 teams?

Post by j man »

Siao7 wrote:
j man wrote:Way back in 1952 and 53 they ran the championship to Formula 2 regulations due to a shortage of teams able to field Formula 1 cars. If multiple teams do go to the wall due to the current crisis, it could be a possible temporary solution to keep the sport going. Have them use spec F2 cars for a couple of years until things recover. I'd rather that than have three-car teams with the general lack of racing that occurs between team mates.

Then again with the much closer competition that would create, I doubt anyone would want to go back to the old rules...
Not sure this would work, F2 is a "spec" series, isn't it? Just too many differences with F1 to try this.
Well it would be completely new territory for F1 no doubt, but then again we are in new territory already with the season suspended for a global pandemic. Desperate times call for desperate measures, and if a number of teams are going to be struggling financially then it may be the only way to keep a full grid for a couple of years until things recover.

Of course, ideally F1's owners could dip into their deep pockets to protect their investment. They take enough money out of the sport so they can damn well put some back in when it's needed. Having that protection at a time like this could be the one thing that justifies the sport's commercial ownership model.

Option or Prime
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Re: Is this the end for some F1 teams?

Post by Option or Prime »

I sort of like the idea of this, evens up the field so of the newer drivers like Ocon, Sainz, Norris and Russell could really worry Verstappen, Leclerc, Hamilton etc. might be really good!

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Re: Is this the end for some F1 teams?

Post by pendulumeffect »

If worse came to the worst, and F1 was cancelled for 2 seasons (this is a very real possibility) I am sure most or all the struggling teams would simply be bought out by somebody. The furloughed staff and organisation still has future value.

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Re: Is this the end for some F1 teams?

Post by Paolo_Lasardi »

j man wrote:Way back in 1952 and 53 they ran the championship to Formula 2 regulations due to a shortage of teams able to field Formula 1 cars. If multiple teams do go to the wall due to the current crisis, it could be a possible temporary solution to keep the sport going. Have them use spec F2 cars for a couple of years until things recover. I'd rather that than have three-car teams with the general lack of racing that occurs between team mates.

Then again with the much closer competition that would create, I doubt anyone would want to go back to the old rules...
Probably, it would end up having Mercedes, Ferrari and Red Bull building their own cars with all the others driving F2 cars. The top 3 teams would take all the wins and titles with nobody able to challenge them.
.
.
.
Wait, everything would be as usual! :lol:

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Re: Is this the end for some F1 teams?

Post by Zazu »

pendulumeffect wrote:If worse came to the worst, and F1 was cancelled for 2 seasons (this is a very real possibility) I am sure most or all the struggling teams would simply be bought out by somebody. The furloughed staff and organisation still has future value.
The government arent going to pay wages for 2 years!!!
I don't see a queue of people looking to buy F1 teams at all.

People take about losing teams being horrific but would anyone really have missed Williams last year? The other easy alternative is to make available cheaper slightly slower cars that are second or so off the pace at the fraction of the price. Already have the big 3 then a gulf to the rest so could easily have a third tier to fill grids

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Re: Is this the end for some F1 teams?

Post by TheGiantHogweed »

https://www.racefans.net/2020/04/08/ana ... ial-shock/

Pretty good article here about some teams situations, or how much of a chance they have of remaining.

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Re: Is this the end for some F1 teams?

Post by Option or Prime »

TheGiantHogweed wrote:https://www.racefans.net/2020/04/08/ana ... ial-shock/

Pretty good article here about some teams situations, or how much of a chance they have of remaining.
Thats pretty concerning!

Williams, Haas: Critical
Alfa Tauri, Alfa Romeo, Mercedes and Renault: Endangered

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Re: Is this the end for some F1 teams?

Post by j man »

TheGiantHogweed wrote:https://www.racefans.net/2020/04/08/ana ... ial-shock/

Pretty good article here about some teams situations, or how much of a chance they have of remaining.
Obviously worrying, and I wouldn't wish for anyone to lose their job. But how many of us have been complaining about the current state of F1 in recent years? The two tier system of factory teams and customer teams? The political power wielded by the big teams? This might be an opportunity for a reset...

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Re: Is this the end for some F1 teams?

Post by F1 MERCENARY »

I don't think it's an opportunity so much as it is simply TIME for a change in how F1 has been run for decades. Hosting & Entry fees need to come down, and Ferrari's automatic kickback needs to be abolished, and then after the WCC prize money is distributed, they need to restructure the distribution of what's left, equally, among the teams so they can enjoy a more sustainable existence.
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Re: Is this the end for some F1 teams?

Post by pc27b »

some f1 teams could fold up this year, same as other big or small businesses around the world will.

yes it is time to restructure how f1 works. team payouts, weekend schedule etc

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Re: Is this the end for some F1 teams?

Post by pokerman »

Option or Prime wrote:Outcome of the meeting today.

Teams had already agreed to reduce the original $175m cap in 2021 to $150m as a result of financial problems caused for F1 by coronavirus.

But at the meeting, the top three teams pushed back on a proposal to reduce the cap further to $125m
Believe it or not Ferrari proposed a 2 tier budget cap with the likes of Ferrari and I guess one or two other teams capped at $200M, the rest at $125M.
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Siao7
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Re: Is this the end for some F1 teams?

Post by Siao7 »

pokerman wrote:
Option or Prime wrote:Outcome of the meeting today.

Teams had already agreed to reduce the original $175m cap in 2021 to $150m as a result of financial problems caused for F1 by coronavirus.

But at the meeting, the top three teams pushed back on a proposal to reduce the cap further to $125m
Believe it or not Ferrari proposed a 2 tier budget cap with the likes of Ferrari and I guess one or two other teams capped at $200M, the rest at $125M.
Did you even bother reading the article? Not sure where you found these figures, but rather than painting Ferrari as the villains, if you bothered to read the article it explains a lot. They gave their reasoning and in fairness it is a very good one; the top 3 bear the brunt of the R&D costs, they spend way more than the smaller teams that just buy ready parts from the bigger teams. R&D is a massive cost and all they are trying to do is to get this recognised in this equation, I think it is fair play.

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Re: Is this the end for some F1 teams?

Post by mikeyg123 »

Siao7 wrote:
pokerman wrote:
Option or Prime wrote:Outcome of the meeting today.

Teams had already agreed to reduce the original $175m cap in 2021 to $150m as a result of financial problems caused for F1 by coronavirus.

But at the meeting, the top three teams pushed back on a proposal to reduce the cap further to $125m
Believe it or not Ferrari proposed a 2 tier budget cap with the likes of Ferrari and I guess one or two other teams capped at $200M, the rest at $125M.
Did you even bother reading the article? Not sure where you found these figures, but rather than painting Ferrari as the villains, if you bothered to read the article it explains a lot. They gave their reasoning and in fairness it is a very good one; the top 3 bear the brunt of the R&D costs, they spend way more than the smaller teams that just buy ready parts from the bigger teams. R&D is a massive cost and all they are trying to do is to get this recognised in this equation, I think it is fair play.
This might be a stupid question but if say Mercedes sell their engines to various teams for a total of 25 million dollars could they take that 25 million out of the costs to develop the engines therefore effectively giving them an extra 25 million in budget?

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Re: Is this the end for some F1 teams?

Post by Siao7 »

mikeyg123 wrote:
Siao7 wrote:
pokerman wrote:
Option or Prime wrote:Outcome of the meeting today.

Teams had already agreed to reduce the original $175m cap in 2021 to $150m as a result of financial problems caused for F1 by coronavirus.

But at the meeting, the top three teams pushed back on a proposal to reduce the cap further to $125m
Believe it or not Ferrari proposed a 2 tier budget cap with the likes of Ferrari and I guess one or two other teams capped at $200M, the rest at $125M.
Did you even bother reading the article? Not sure where you found these figures, but rather than painting Ferrari as the villains, if you bothered to read the article it explains a lot. They gave their reasoning and in fairness it is a very good one; the top 3 bear the brunt of the R&D costs, they spend way more than the smaller teams that just buy ready parts from the bigger teams. R&D is a massive cost and all they are trying to do is to get this recognised in this equation, I think it is fair play.
This might be a stupid question but if say Mercedes sell their engines to various teams for a total of 25 million dollars could they take that 25 million out of the costs to develop the engines therefore effectively giving them an extra 25 million in budget?
It is a very good question. I guess not, as it is an earning, which is separate from the budget. In general I'd think that if the budget is $200M and they earn $230M, they can not say "ok, we now have $430M as a budget".If it is towards an R&D part that they produce, then you could make the case I guess. But I'd think that this would be the case for spec items like the ECU that McLaren was tasked to provide for everyone by the FIA, not for general customer sales like engines.

They haven't even sussed out basic things, as they mention in the article, how this budget (in $$) will be converted in ££ and €€ for the different teams around Europe. It still needs a lot of work by the sound of it.

In the end of the day, the teams vary so much that they can't have a "one size fits all" solution. I find the request from the big teams quite reasonable, the specifics can be arranged, otherwise it is quite a valid request.

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Re: Is this the end for some F1 teams?

Post by Zazu »

The European teams still operate using US dollars. They'll be the odd exception but sponsorship deals, prize money etc will all be in it. Its the world's business currency

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Re: Is this the end for some F1 teams?

Post by pc27b »

i was looking at the 2019 f1 team payouts. i don't really understand this spending cap ? at a $145 million cap, does liberty just give everyone $145 million ? because even toro rosso got 52 million last year. just seems silly to me

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Re: Is this the end for some F1 teams?

Post by Zazu »

pc27b wrote:i was looking at the 2019 f1 team payouts. i don't really understand this spending cap ? at a $145 million cap, does liberty just give everyone $145 million ? because even toro rosso got 52 million last year. just seems silly to me
Its a limit on what teams are allowed to spend. Nothing to do with prize money. It's has loads of exclusions like driver salaries and stuff

Also, Daimler spent $8billion on R&D last year. I don't think it's going to be that difficult to hide some F1 research inside that

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Re: Is this the end for some F1 teams?

Post by Option or Prime »

Looks like it might be the end for Frank Williams involvement with F1. He wants to sell up after losing £13 million last year.

That would be a significant loss for the sport in my view but sorry to say was always on the cards.

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Re: Is this the end for some F1 teams?

Post by Option or Prime »

The Williams announcement comes as Renault announce a £1.8 billion cut back plan. no real surprise if It proves DR's move was based on that cut back, surely Alonso won't be going there now!

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Re: Is this the end for some F1 teams?

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Re: Is this the end for some F1 teams?

Post by mikeyg123 »

Option or Prime wrote:Looks like it might be the end for Frank Williams involvement with F1. He wants to sell up after losing £13 million last year.

That would be a significant loss for the sport in my view but sorry to say was always on the cards.
I hope Williams can find a way forward which sees them remaining in more than just name. It's good for F1 to have some teams that exist just to go racing.

If they can just get through the next couple of years they might be able to make a bit of a comeback.

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Re: Is this the end for some F1 teams?

Post by Asphalt_World »

My goodness I hope Williams survive this. Would be a massive loss. If ever the mega bucks in F1 needed to be put to good use. this is it. There must be a way.
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Re: Is this the end for some F1 teams?

Post by MistaVega23 »

The Rokit deal is also off, effective immediately.

I wonder what livery they'll run once the season gets underway now?
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Re: Is this the end for some F1 teams?

Post by j man »

JN23 wrote:Renault say they remain committed: https://www.motorsport.com/f1/news/rena ... s/4798159/
Interesting that they cite the forthcoming budget cap as the reason they are staying. I daresay it will also help Williams enormously in finding a buyer, in fact I'd say owning an F1 team is a fairly attractive proposition at the moment with the changes that are planned to re-balance the sport.

I don't think it's an exaggeration to say that if Bernie was still in charge and things had been kept as they are at the moment, then F1 would be on the verge of imploding right now.

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Re: Is this the end for some F1 teams?

Post by JN23 »

j man wrote:
JN23 wrote:Renault say they remain committed: https://www.motorsport.com/f1/news/rena ... s/4798159/
Interesting that they cite the forthcoming budget cap as the reason they are staying. I daresay it will also help Williams enormously in finding a buyer, in fact I'd say owning an F1 team is a fairly attractive proposition at the moment with the changes that are planned to re-balance the sport.

I don't think it's an exaggeration to say that if Bernie was still in charge and things had been kept as they are at the moment, then F1 would be on the verge of imploding right now.
Yeah someone said that elsewhere on the forum I think. The budget cap is hopefully a move towards F1 becoming attractive to new teams again, although a global economic downturn might put pay to that.

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