Ideas to cut costs in F1

[Chaparral]

Part of a quote from Mosley overnight.

"We need to have a radical revision of the whole thing - we have got to get the costs down not by 10 or 20 per cent, but down to 10 or 20 per cent of what they are now.

"I would expect a team to be able to run in the 30-40 million pound bracket. If we can do that, then a combination of what they get from television and central rights, and what they can get from sponsors, should make the teams viable without huge subsidies either from the car industry or billionaires. But without that, I don't really see where the money is coming from.

Now thats all well and good if you can muscle the teams into accepting those sort of cuts and the use of a Cosworth designed 'spec' engine format - but is it only the teams costs they are looking at - what about the broader picture and the circuit owners/promoters in the various territories who are bleeding from the exhorbitant fees they are asked to front up with - and with no chance of recouping and making a profit - just ask Silverstone, France, USA, Canada, Australia, China etc - I bet theyre not looking to cut those (just yet). Speaking of Cosworth Kevin Kalkhoven co-founder of Champcar and current half owner of Cosworth has just purchased back 96 shiny new 2.8 litre turbocharged 750 bhp units from his former series at a bargain basement price - and has no where to place them unless he's planning to start another US open wheel series or maybe take over supply of powerplants to the IRL if Honda pull out - they would make a very handy powerplant for F1 actually and quite cheap.

[modbaraban]

Duh... I thought a GP2 team budget is bigger than that.

[WhiteBlue]

Duh... I thought a GP2 team budget is bigger than that.

certainly not

[xpensive]

I'm afraid that at this point there´s really not that much to choose from, cost to compete just has to be drastically reduced, where drivetrain is a logical beginning.
When manufacturer's began to arrive on the scene in the early 80s, I for one was excited as this brought some serious engineering in after all the trial'n error and guesswork of the 70s.
But clearly, this has now gone completely out of hand, when Nick Fry yesterday admitted that Honda spent some 350 MUSD last year to finish effectively last, it said it all for me anyway.
Apparently Max Mosley has changed his mind too, realizing that this kind of spending will end with three or four teams competing. I just hope that he has advisors good enough to change the aerodynamic rules to make three-shifts work in a full-scale rolling-ground windtunnel redundant. Multi MW blowers on full song for 24 hours year around?

[timbo]

But clearly, this has now gone completely out of hand, when Nick Fry yesterday admitted that Honda spent some 350 MUSD last year to finish effectively last, it said it all for me anyway.

This is not because they didn't spent ENOUGH, ain't it? They could well spend a billion. I remember that Prost team reportedly had a very high budget at 2000, and yet couldn't score a point.
Of course that figures are ridiculous, but the way cost-cutting is imposed is just WRONG. Yeah, they can make cars that would be constructed from cardboard and powered by racers muscles. But then ones who want would spend half a billion on sportsman training. Maybe it would be performance differentiator, maybe not, but one who have money would spend money and others WILL follow. And then still manufacturers would drop off.
Just look at this figures from WIKI

Costs vary greatly from team to team; in 2006 teams such as Honda, Toyota, McLaren-Mercedes and Ferrari are estimated to have spent approximately $200 million on engines, Renault spent approximately $125 million and Cosworth's 2006 V8 was developed for $15 million.[58] In contrast to the 2006 season on which these figures are based, the 2007 sporting regulations ban all performance related engine development.[59]

The only way to cut costs is not by downgrading technology. Is to actually CUT costs by imposing a budget cap and audit system.

[xpensive]

I agree that in a perfect world, a sensible budget cap would be the way to go to efectively cut costs, while retaining a technical freedom.

But how to police the actual spending in this globalized world, when R&D work could be conducted anywhere under any budget, basically impossible I'm afraid.

On a more humorous note, I recall when this was discussed before by the FIA, the cost of team-principals should be excluded from the cap. Says it all, doesn't it?

[Metar]

A budget-cap is an excellent idea, and perhaps the only one that might work sensibly to reduce costs (because teams will spend all their money to gain an advantage, even if it's a tenth), but it's impossible to police. We'll see Dallara getting a handsome sum from Marlboro, "without any connection to Ferrari", for, uhh, running a scale model "resembling an F2010". Some server-farm in India will get a few floppy-disks of a VJM-03 to run on their CFD station (I'm sure FIF1 hasn't upgraded to USB and CDs - perhaps not even 3.5'' Floppies), in return for some money from Kingfisher.

They'll just get their sponsors to pay for the extras through unofficial means...

[WhiteBlue]

Teams that run 1000+ employees will never agree to restrictions that take the funding advantage away from them. The method is irrelevant. You can propose budget caps, employee caps, limits on wind tunnels or CFD they will allways find a way to object or torpedo the plan.

The only way to achieve a level playing field is to funnel their excess cash towards projects that tie up money in performance differentiators of short life and of secondary benefits to the public. Engine power should never be allowed as a performance differentiator as long as we have the drastic difference in funding with the danger to loose more teams. If hypothetically there are 12 factory teams or similarly funded teams owned by brands which spend on a similar level then cost control would not be a concern.

As things stand we have the opposite situation and I think the method outlined in the 18.11.08 letter to the teams will be both appropriate and successfull. I'm talking about the root and branch analysis with A, B and C parts lists. When they have done that work it will be obvious what remains a performance differentiator, what will be standardized and which parts will be deemed "constructor proprietary".

In addition I see no alternative to control of certain resources in a mandatory way. Manufacturer teams should not be able to spend substantially more money on performance differentiators than private teams, which needs to be controlled via resource control. They should be allowed to burn their cash in driver and director salaries, hospitality, marketing engine efficiency development, HERS and KERS development. Thats it. Everything else they should not be able to spend more on than their income from FOM. The FOM money should be very simillar for all teams with a very moderate prize money element for points which should come out of Bernies coffers on top of what they have now.

Such a formula would put the fun back into F1. We would regularly get surprises like Super Aguri or Toro Rosso beating the big guys and talented drivers would have a lot more chance to drive a competitive car. We need close performance as we have seen it this season to make the racing entertaining and bring the human factor back into it.

[CMSMJ1]

Engine power should never be allowed as a performance differentiator as long as we have the drastic difference in funding with the danger to loose more teams. .

What? The point of F1 is that it is to demonstarte who makes the best engines. Always has been.

Anyone could make a carriage back in the day but only some people could make decent engines.. motor racing became a sport to demonstrate who made the best engines and you coul drive them fastest. Nobody cared about the carriage or the chassis and you can argue that they still don't.

Removing the reason for the car makers to be involved won't make F1 better.

This is like nobbling horses in horse racing to make sure that al the jockeys have an equal chance of winning... totally misses the point.

[Scania]

Engine power should never be allowed as a performance differentiator as long as we have the drastic difference in funding with the danger to loose more teams. .

What? The point of F1 is that it is to demonstarte who makes the best engines. Always has been.

Anyone could make a carriage back in the day but only some people could make decent engines.. motor racing became a sport to demonstrate who made the best engines and you coul drive them fastest. Nobody cared about the carriage or the chassis and you can argue that they still don't.

Removing the reason for the car makers to be involved won't make F1 better.

This is like nobbling horses in horse racing to make sure that al the jockeys have an equal chance of winning... totally misses the point.

Not the best engine, but the best car only.

[WhiteBlue]

Engine power should never be allowed as a performance differentiator as long as we have the drastic difference in funding with the danger to loose more teams. .

What? The point of F1 is that it is to demonstarte who makes the best engines. Always has been.

Anyone could make a carriage back in the day but only some people could make decent engines.. motor racing became a sport to demonstrate who made the best engines and you coul drive them fastest. Nobody cared about the carriage or the chassis and you can argue that they still don't.

Removing the reason for the car makers to be involved won't make F1 better.

This is like nobbling horses in horse racing to make sure that al the jockeys have an equal chance of winning... totally misses the point.

The best engines will not be those, which unleash the most power. The useable power output will be regulated by top rpm and torque profile. So you end up with the best engine being the one which performs the standard output with the lowest energy use and highest reliability over ever increasing life cycle requirements. This will be reality unless I'm very mistaken.

[xpensive]

I agree completely with WB here, though I might have other ideas on which type of engine to use.

[CMSMJ1]

I can see this is where they are leading us but it is just poor..

Rev limits.OK..if you must.
If we are having this stupid attempt at cost cutting lumped in with eco issues then it is misguided.

if you want the best engine ot be the one that lasts longest, uses the least fuel etc...then the common winning denominator will be that it produces the most power while doing the eco and efficiency tricks too.

The sport would not be allowed to be invented now - it is too crazy to spend millions on making bespoke cars go fast...

I can see you guys are keen and green but please remember that this is the attitude that will allow F1 to die. Maybe it will anyways.

I go back to my initial points - if you cannot pay to play. then don't pay at all.

..as an aside...I think the endless monetary raping of circuits and promoters by Bernie needs ot be included in these discussions. It is not good that one dwarf with bad hair is able to screw over the grass roots of racing.

[xpensive]

No argument over the last statement CMSMJ1, the sport needs to rid itself of ita raw profiteers, now would be a god time.

[WhiteBlue]

I believe that Max Mosley has given some advise to the teams between the lines of his 18.11.2008 letter. He said that the FIA would be happy to sanction a series for them if they ever wanted to rid themselves of the the current FOM restrictions.

http://www.fia.com/en-GB/mediacentre/pr ... ov1808.pdf

from this the following § is relevant:

Finally, I should make it clear that the FIA has an absolute duty to ensure that its Formula One
World Championship continues. When a problem such as the current world-wide financial crisis
emerges, the FIA must rapidly introduce whatever regulations it judges necessary to ensure the
survival of its principal championship.

We will, of course, always do this in consultation with the stakeholders and we will try hard to
accommodate the wishes of at least a majority of the teams.

However, we must recognise that in an extreme situation, not all teams may agree with our
measures. We appreciate that in these circumstances some teams might decide not to enter the
World Championship and opt instead for some other professional racing series. Furthermore,
we are, of course, always ready to sanction an international series for teams which wish to run
under regulations other than those of Formula One. We would require only that the series in
question did not fall below current safety standards and met the generally accepted criteria of
sporting fairness. We would, of course, not be concerned with the financial viability of a series
which was not part of an FIA championship, nor with the amount of money spent by participants.

To me this sounds like lawyer talk actually saying:

Please remember that you can allways boot Bernie's CVC and organize your own series, but be aware that the FiA will be the sanctioning body for any kind of racing series anywhere on earth. So head we win, tail CVC looses. You cannot evade working with us and perhaps that wouldn't be such a bad idea anyway. Lets see if we can squeeze some more money from CVC. I can even imagine Bernie letting FOM go bust and getting on board of a new show.