FIA APPROVES ANDRETTI FORMULA RACING APPLICATION AFTER RIGOROUS ANALYSIS
https://www.fia.com/news/fia-approves-a ... s-analysis
Ball is in FOM's court now
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One more team will mean less to go around since the size of the pie will likely remain the same. My guess is that after 2 seasons, some team will be sold or change ownership.
The cost as of now, if Andretti doesn't bring any extra revenue, has been calculated in 11 mi a year for each team.
Because all those things Chase Carey negotiated were actually beneficial for the teams on the whole. It made them much easier to fund and in some cases profitable, that's not a difficult pitch for a decent negotiator. Domenicale on the other hand is being asked to cut their revenue share whilst FOM keeps its share as is. They'll get some compensation for it initially, but it's probably going to be a losing proposition in the long run. And the idea that Andretti's presence will increase revenue is hopeful at best. There will be some hype initially but it will die down, and 2-3 years after they join it will be business as usual, but with 11 teams sharing the pie instead of 10. And those 11 teams will undoubtedly be very demanding when the next concorde agreement is to be negotiated. In the end the revenue of the sport will not be affected by the nationality of one team, but rather the quality of the competition. I'm not convinced Andretti has the resource, know how, or even the ambition to actually become a contender. They'll get in and be content with their billion dollar valuation and annual revenue from F1 and sponsors. Americans will not embrace their mediocrity, and Andretti is anyways mostly unknown to the demographics that F1 is targetting in the US.FW17 wrote: ↑04 Oct 2023, 10:54The issue is simple......
Chase Carey was brilliant negotiator, He got teams signed to concord agreement with a budget cap, Ferrari bonus gone, column 1 and 2 gone, championship bonus gone. All while still not incurring any loss to FOM share of the revenue pie.
Now they have Stefano Domenicali. The last negotiations he handled ended up with FOTA getting dismantled, Ferrari loosing the test track and signing to an turbo engine formula with a development freeze from day 1.
Stefano has no ability to negotiate with the teams, who will want and are in a position to take more than what they are being offered now. He feels the only way to get this across the line is to cozy up to the team owners and try to paint a picture as teams first and FOM/Teams are the best of friends. No way is he going to get the 2026 agreement signed without FOM loosing a significant portion of revenue. Andretti is just mixed up in the middle of this, with Stefano having no option but to brown nose the teams.
Stefano being cozy with with the team principals is to make himself seem indispensable with this misguided unity message he has always been peddling to the US HQ. But sooner or later Greg Maffei is going to step in to negotiate the contract directly with the teams with Stefano causing more harm to the FOM than they could have ever imagined.
I disagree. Chase created all those points of negotiations with the teams.Cs98 wrote: ↑05 Oct 2023, 12:52Because all those things Chase Carey negotiated were actually beneficial for the teams on the whole. It made them much easier to fund and in some cases profitable, that's not a difficult pitch for a decent negotiator. Domenicale on the other hand is being asked to cut their revenue share whilst FOM keeps its share as is. They'll get some compensation for it initially, but it's probably going to be a losing proposition in the long run. And the idea that Andretti's presence will increase revenue is hopeful at best. There will be some hype initially but it will die down, and 2-3 years after they join it will be business as usual, but with 11 teams sharing the pie instead of 10. And those 11 teams will undoubtedly be very demanding when the next concorde agreement is to be negotiated. In the end the revenue of the sport will not be affected by the nationality of one team, but rather the quality of the competition. I'm not convinced Andretti has the resource, know how, or even the ambition to actually become a contender. They'll get in and be content with their billion dollar valuation and annual revenue from F1 and sponsors. Americans will not embrace their mediocrity, and Andretti is anyways mostly unknown to the demographics that F1 is targetting in the US.FW17 wrote: ↑04 Oct 2023, 10:54The issue is simple......
Chase Carey was brilliant negotiator, He got teams signed to concord agreement with a budget cap, Ferrari bonus gone, column 1 and 2 gone, championship bonus gone. All while still not incurring any loss to FOM share of the revenue pie.
Now they have Stefano Domenicali. The last negotiations he handled ended up with FOTA getting dismantled, Ferrari loosing the test track and signing to an turbo engine formula with a development freeze from day 1.
Stefano has no ability to negotiate with the teams, who will want and are in a position to take more than what they are being offered now. He feels the only way to get this across the line is to cozy up to the team owners and try to paint a picture as teams first and FOM/Teams are the best of friends. No way is he going to get the 2026 agreement signed without FOM loosing a significant portion of revenue. Andretti is just mixed up in the middle of this, with Stefano having no option but to brown nose the teams.
Stefano being cozy with with the team principals is to make himself seem indispensable with this misguided unity message he has always been peddling to the US HQ. But sooner or later Greg Maffei is going to step in to negotiate the contract directly with the teams with Stefano causing more harm to the FOM than they could have ever imagined.
The reason is called profitability. Even if it was sustainable for them to spend all of that money it was wasteful. No extra exposure but a lot of extra cost, the budget cap put an end to that and saved them a lot of money.FW17 wrote: ↑06 Oct 2023, 08:52I disagree. Chase created all those points of negotiations with the teams.Cs98 wrote: ↑05 Oct 2023, 12:52Because all those things Chase Carey negotiated were actually beneficial for the teams on the whole. It made them much easier to fund and in some cases profitable, that's not a difficult pitch for a decent negotiator. Domenicale on the other hand is being asked to cut their revenue share whilst FOM keeps its share as is. They'll get some compensation for it initially, but it's probably going to be a losing proposition in the long run. And the idea that Andretti's presence will increase revenue is hopeful at best. There will be some hype initially but it will die down, and 2-3 years after they join it will be business as usual, but with 11 teams sharing the pie instead of 10. And those 11 teams will undoubtedly be very demanding when the next concorde agreement is to be negotiated. In the end the revenue of the sport will not be affected by the nationality of one team, but rather the quality of the competition. I'm not convinced Andretti has the resource, know how, or even the ambition to actually become a contender. They'll get in and be content with their billion dollar valuation and annual revenue from F1 and sponsors. Americans will not embrace their mediocrity, and Andretti is anyways mostly unknown to the demographics that F1 is targetting in the US.FW17 wrote: ↑04 Oct 2023, 10:54The issue is simple......
Chase Carey was brilliant negotiator, He got teams signed to concord agreement with a budget cap, Ferrari bonus gone, column 1 and 2 gone, championship bonus gone. All while still not incurring any loss to FOM share of the revenue pie.
Now they have Stefano Domenicali. The last negotiations he handled ended up with FOTA getting dismantled, Ferrari loosing the test track and signing to an turbo engine formula with a development freeze from day 1.
Stefano has no ability to negotiate with the teams, who will want and are in a position to take more than what they are being offered now. He feels the only way to get this across the line is to cozy up to the team owners and try to paint a picture as teams first and FOM/Teams are the best of friends. No way is he going to get the 2026 agreement signed without FOM loosing a significant portion of revenue. Andretti is just mixed up in the middle of this, with Stefano having no option but to brown nose the teams.
Stefano being cozy with with the team principals is to make himself seem indispensable with this misguided unity message he has always been peddling to the US HQ. But sooner or later Greg Maffei is going to step in to negotiate the contract directly with the teams with Stefano causing more harm to the FOM than they could have ever imagined.
There was no reason for the top 3 teams (Ferrari, Mercedes and Red Bull) to agree to a budget cap when they had no issues with their cashflows, or for them to give up on their championship bonuses.
These were well handled by Chase. On the other hand Domenicali has not put forward anything that would be a point of discussion towards signing the next deal. The only thing we have heard is him unloading on any new team proposal and talking about franchise.
Anyway when Cadillac joins, and if they finish last for the next 5 years, the teams would loose about 276 million (4% of revenue with a base of 1.15 bn and 8% yearly teams price money growth). If they finish 6th every year teams would loose 613 million. If they progress steadily from last to 6th over the 5 years, teams loose 421 mn. From all of this the 200 mn dilution fee need to be deducted.
