2021 Cost Cap Rumours and Speculation

[littlebigcat]

It's not my fault you aren't understanding the point that is being made! It's officially known that James Allison is CTO of a non-F1-racing Mercedes company.

This is factually incorrect. It's officially known that James Allison is CTO of a non F1 racing division within Mercedes Grand Prix. How do we know this? It's in Mercedes Grand Prix's 2021 accounts that were published on the 7th of October.

However what you seem to be accusing Mercedes of is exactly how Red Bull Racing, with its 59 total employees and wage bill of only £12m(as of 2020) operates.

[Just_a_fan]

What was/is James Allison's salary and why isn't he part of the cost cap? How is this different to Newey?

I don't know, you tell me! Also, why do you keep insisting that others think is different than Newey?

It's not my fault you aren't understanding the point that is being made! It's officially known that James Allison is CTO of a non-F1-racing Mercedes company. But he has been present at races, talks about Mercedes upgrades that worked and didn't, and was wearing the official Mercedes team wear when present at the races. He is very much still "involved". But from the articles that have been written about him, he isn't involved. He's been quoted as saying Toto found a way for him to be involved. Seems to me all the Mercedes fans here are turning a blind eye to this arrangement as if there is nothing peculiar. I wonder how such an arrangement is possible? Surely other teams should inquire Mercedes.

Deflection attempt based on your hatred of Mercedes. Again.

[Stu]

It's going to set a terrible precedent if they allow it. Imagine all the people suddenly being "employees" but actually working for another firm that are effectively outside of the remit of the FIA.

Regulations doesn't necessarily say, ONLY EMPLOYEES are allowed to be in the group of 3 excluded from the cost cap.

https://www.fia.com/sites/default/files ... -02-18.pdf

3. EXCLUSIONS
3.1 In calculating Relevant Costs, the following costs and amounts within Total Costs of the Reporting Group must be excluded ("Excluded Costs"):

(a) All costs Directly Attributable to Marketing Activities;

(b) All costs of Consideration provided to an F1 Driver, or to a Connected Party of that F1 Driver, in exchange for that F1 Driver providing the services of an F1 Driver to or for the benefit of the F1 Team, together with all travel and accommodation costs in respect of each F1 Driver;

(c) All costs of Consideration provided to an Other Racing Driver, or to a Connected Party of that Other Racing Driver, in exchange for that Other Racing Driver providing the services of an Other Racing Driver to or for the benefit of the F1 Team, together with, all travel and accommodation costs in respect of each Other Racing Driver;

(d) All costs of Consideration provided to the three individuals (other than any individual in respect of whom all costs of Consideration are excluded pursuant to any other subArticle of this Article 3.1) in respect of whom the highest aggregate amount of Consideration has been recognised in Total Costs of the Reporting Group during the Reporting Period (the "Excluded Persons"), or to a Connected Party of any Excluded Person, in each case in exchange for that Excluded Person providing services to or for the benefit of the F1 Team, together with associated employer’s social security contributions and all travel and accommodation costs in respect of each Excluded Person;

To simply, cost cap allows the exclusion of driver payments where a driver can be an employee or a contractor from another firm who lends driving services to any F1 team. The fees for his services paid to his employer if he is a contractor, is excluded.

Same thing applies to anyone providing service to the F1 team, whether an employee or a contractor from another firm. In this case, Newey. This person(s) can be put into the group of 3 excluded, other than drivers.

How can such a straight forward statement be ambigous?

Very interesting wording in the rules. Are driver PA’s included within the cap (employed by the team for the driver) or excluded (employed by the driver). How much needs to be booked to cover contractual obligations to the driver? If a driver wants their father, girlfriend, brother, pet to attend and they pay for it, is it excluded? If there is a contractual obligation for the team to pay for these things, are they included?

As @Langedweil said earlier, bring back the 80’s! The FISA/FOCA wars were much less complex and personal!!!

[Quantum]

But if the FIA do punish us harshly, it's because Toto Wolff something something something.


Never ending stream of inability to take responsibility and gaslighting at its finest.

100% this.

The deflection derails the topic and I think mods need to direct it better.

[Wil992]

Finally a logical explanation!

Yea, this is a thing I was thinking about too. I’m not sure where the line is on this. If he has a personal service company that bills RB for his time, that’s clearly allowed as one of the top 3 earners and can be excluded from the cap.
But what if that company hires another employee? Does that mean it immediately becomes just another supplier and therefore not able to be excluded? If not, where is the line? Could his ltd co hire the entire aero dept and call that one of the top 3 earners?
My feeling is that because the allowable exclusions refers specifically to individuals, the minute there’s more than 1 person, they can’t be on the list. I’m sure that’s the intention of the rules, at least.

Since his company more than likely would be limited liability.. the business would not be with the man Adrian Newey.. It would be with the company. A ltd company is a separate entity from its owners. So even if Newey was the sole person in that company.. the FIA will not see the company as Adrain Newey, it would be seen as the contractor racing services.

No, this is wrong.
Remember we're not talking about the law here, we're talking about the cost cap regulations as written by the FIA. So, despite the fact that a ltd co would be a separate legal entity (as you rightly point out), it is still allowed to be included in the top 3 earners.

From the regs:
"All costs of Consideration provided to the three individuals...in respect of whom the highest aggregate amount of
Consideration has been recognised...or to a Connected Party of any Excluded
Person."

So it can be a person, or a party connected to that person.

In the definitions from the same document:
"Connected Party" means, in relation to a Relevant Person...any company, trust, partnership, or other body, organisation or mechanism
established or operating directly or indirectly in whole or in part for the benefit of or
in respect of the Relevant Person or any or all of the other categories of person
referred to in this definition.

So, from the FIA's definition of a connected party, a company can still be included as a top 3 earner.

I assume it has been written this way specifically to enable people (and there'll be lots across all teams) who use ltd companies for payment to still count as top earners.

[Just_a_fan]

If the issue is Newey's pay, and we have only rumour that it is, then it will most likely be an issue of how much of his time/pay is assigned to F1.

For example, he might be paid 50% for F1 and 50% for other projects but Red Bull put 100% down in the budget cap exclusion.

That's the sort of figure juggling that gets done to try to play the authorities day in, day out.

[Juzh]

If the issue is Newey's pay, and we have only rumour that it is, then it will most likely be an issue of how much of his time/pay is assigned to F1.

For example, he might be paid 50% for F1 and 50% for other projects but Red Bull put 100% down in the budget cap exclusion.

That's the sort of figure juggling that gets done to try to play the authorities day in, day out.

This would be too obvious a stunt I think. Newey is just way too high profile for this trick to ever work.

[Sieper]

Plus, FIA have already said all teams cooperated and acted in good faith. The mere suggestion of malice is out of place.

[Just_a_fan]

If the issue is Newey's pay, and we have only rumour that it is, then it will most likely be an issue of how much of his time/pay is assigned to F1.

For example, he might be paid 50% for F1 and 50% for other projects but Red Bull put 100% down in the budget cap exclusion.

That's the sort of figure juggling that gets done to try to play the authorities day in, day out.

This would be too obvious a stunt I think. Newey is just way too high profile for this trick to ever work.

It could have been done mistakenly, but yes, unlikely. As I said, it was merely an example.

[KeiKo403]

Just thinking, if travel costs are exempt, hotels, flights, food. What about the cost of personnel while travelling between races?

Is it a travel cost for paying someone to sit on a plane/coach?

Could RedBull Technology be paying staff wages 100% but only claim money from RBR for time spent in the base or at race tracks?
So a race team member might be contracted to work 50h/w but RedBull only utilise 35h/w and so save 30% on salaries?

RedBull Technology supply the staff where RedBull Racing needs them and so only pays for what they use? Is that a thing???

[Quantum]

Plus, FIA have already said all teams cooperated and acted in good faith. The mere suggestion of malice is out of place.

Not sure if it is inadvertent rule breaking, especially when 9 other teams got it right.

The thing is, we do see patterns emerge and statements made which cannot be retracted.
For example, when journalists noted Red Bulls successive upgrade packages arriving at each race weekend.

https://www.motorsport.com/f1/news/red- ... e/6651261/

Asked if he was surprised that Mercedes had chosen to call time so early on developing its 2021 car, Horner said: “I don't know what their constraints are.

And prior to this whole mess we had some pretty prophetic words from Horner again regarding the policing and the structural make up of what is permissible way back in 2020.

We have to rely on the governing body,” he explained. “There are a set of rules that you sign up to, and that's what we'll be adhering to. But inevitably it is complicated and there are different structures, there are teams within organisations and automotive manufacturers. We're going to need to rely very heavily on the FIA to ensure that it is fairly policed.
Asked if he believed there would be some contentious issues that would crop up as the cost cap rules rolled out, Horner said: “Unfortunately I think that's almost inevitable. And so, I just hope we don't end up in accounting world championships, rather than the ones that are settled on circuit.”

https://www.motorsport.com/f1/news/horn ... p/4800313/


As per Binotto/Wolff etc it was noted that RB had a stream of updates on their car and other teams were scratching their heads as to how this was achievable.
This is all in the public domain and referenceable. We do not need to speculate about the evidence of our eyes and ears on that front, right?
So why was Red Bull so much more efficient than any other team last year, producing updates ad nauseaum, and this year we find they breached the budget cap?
Are we to ignore last year, and put this down to a clerical error/interpretation when Horner himself was intimating towards the "battle of accountants"?

That reeks.

[Just_a_fan]

Plus, FIA have already said all teams cooperated and acted in good faith. The mere suggestion of malice is out of place.

And yet suggestions of malice are thrown against drivers for "taking Max out", when it's obviously not done on purpose.

Red Bull have deliberately structured their affairs to maximise budget available for the car. That's a given. All teams will have done it. Red Bull appear to have got it wrong.

[DChemTech]

Plus, FIA have already said all teams cooperated and acted in good faith. The mere suggestion of malice is out of place.

And yet suggestions of malice are thrown against drivers for "taking Max out", when it's obviously not done on purpose.

Red Bull have deliberately structured their affairs to maximise budget available for the car. That's a given. All teams will have done it. Red Bull appear to have got it wrong.

as happens the other way around, e.g. accusations of people deliberately letting Max by, etc.
Let's not confuse fan fiction with FIA communications.

[Wouter]

The thing is, we do see patterns emerge and statements made which cannot be retracted.
For example, when journalists noted Red Bulls successive upgrade packages arriving at each race weekend.

As per Binotto/Wolff etc it was noted that RB had a stream of updates on their car and other teams were scratching their heads as to how this was achievable.

So why was Red Bull so much more efficient than any other team last year, producing updates ad nauseaum,
and this year we find they breached the budget cap?

That reeks.

.
So RBR has upgrade packages to the car every weekend?
And they were "producing updates ad nauseaum."?
Could you show me from each weekend the upgrades? I can't find them. Thankx.

[chrisc90]

Plus, FIA have already said all teams cooperated and acted in good faith. The mere suggestion of malice is out of place.

And yet suggestions of malice are thrown against drivers for "taking Max out", when it's obviously not done on purpose.

Red Bull have deliberately structured their affairs to maximise budget available for the car. That's a given. All teams will have done it. Red Bull appear to have got it wrong.

Or they have found something that every other team has missed. It happens. Nothing to say that RB have done anything wrong at present.

You could say that other teams missed the zero pod concept, or designing a rear armchair wing…