Todt speaks on Autosport about cost control:
Jean Todt wrote:We have to do things step by step. I am in favour of reducing the costs, improving the show, and implementing new technologies. So now we are seeing that we are on the way to having these working groups, advisory strategy group and the F1 Commission, and for me it has to be dealt with inside of those groups. As soon as we are able to do it, we will have a democratic way. No dictatorship. No pressure to do something. We will sit altogether and then we will do what the majority will decide on, which I feel is the most transparent way to run our business.
It will be unfair to have a cost restriction on chassis and do nothing on the engine. Our people have been working very hard with expert companies like Deloitte, KPMG, and other audit companies to see. First I had some doubts that we could do a good job. Now we know we can do a good job. But we have to include the engines. There are still some ongoing discussions. Once we have covered the engine situation, we should be ready to propose something by 2014. And by 2013 with our new groups, with the Concorde Agreement, we should be able to follow the protocol. So it should not be one team is against, one team is in favour. The majority will be able to guide the future of the sport.
Autosport wrote:Todt has reiterated that he wants to ultimately see costs reduced by one third over the next few years.
Jean Todt wrote:How much do we want to control? I hear $250 million. Who can afford $250 million? What is the situation for teams who are producing one engine? There are so many things I read which I am sorry to say are a bit superficial. We must get into the detail. Who is spending $250 million? Probably more than one team. But even if it is three or four, what about the other eight teams? We have to address the problem overall and I hope people will have the right concern to address it. At the end of the day, for me, democracy means that we must make shared decisions. The teams invest money, but do we need to have 150 people or 200 people in a wind tunnel to have a good show? I don't think so. I really hope that people will be happy to realise and undertake some drastic reduction in costs.
Very sensible ideas! So if we have three teams spending $250m the target would be to have that come down to $165m. If an engine company like Mercedes in Brixworth spends $75m now it would come down to $50m. So a manufacturer team like Merc or Ferrari would have a combined budget of $215m. That is a far cry from the $400m+ they used to have six years ago. Perhaps they will agree to reduce it a bit further once they see that profitability would improve.
It is good to see that the FiA have looked into the issue and is committed to drive the issue forward. It is also very good to have Todt come forward and say that budget control on both chassis and engines is feasible and necessary.
