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If you listened to our 2013 season review podcast, you’ll know that Mark (Fake Charlie Whiting) gave the costs of Formula 1 the “Donkey Award” for the year. No doubt this is a very difficult situation as many of the teams on the grid are not in very cash positive positions.

While we’ve all discussed the costs of F1, and the teams and management have as well, it is increasingly difficult to determine just how best to approach this issue. Former FIA president Max Mosley promised a $40M budget and ushered in three new teams under that guise but it didn’t pan out and HRT, one of the new teams, bowed out of F1 altogether leaving Marussia and Caterham.

We’ve been chatting about this “elephant in the room” issue for years now and it seems that the paying-driver scenario has kept teams afloat but the health of F1 is not as it appears. Ferrari’s president, Luca di Montezemolo, agrees that costs are an issue but he’s been critical of late about the lack of real testing and suggested that teams that couldn’t afford a modest test schedule should go back to junior series such as GP2 or Karting.

Luca said that costs are a major issue but there is too much room to cheat within the new FIA Working Group who are charged with defining what areas the teams will cut and how for 2015. AUTOSPORT’s Jonathan Noble has the call:

“For the first time it has been said that we have to define a cap. You know why I have doubts about the cap – because it is very easy to cheat – particularly for [manufacturer] teams. And Ferrari could be one.

“I could go to Chrysler in Detroit to ask them to do something for us. Mercedes could ask their company.

“We have to find something that is credible but the cost is the problem number one.”

Now, before you get too terse here, notice that Luca does agree that costs are major issue and to be fair, he’s advocated real testing as it would be less expensive for Ferrari than spending millions upon millions on simulator systems and it would have a more meaningful impact on car development.

He just feels that here is too much room to bury team expenses in car maker’s P&L’s and included Ferrari as one who could do that…not that they would.

So what can be done? We’ve beaten this horse to death and the pink elephant in the room is aerodynamics, exotic materials and changing regulations. The 2014 season will see a brand new engine format and that costs a fortune to develop. So what can be done to stave off the costs?

“The cost cannot be decided by the technicians – because if so we will never achieve it,” he said.

“The only way to approach this is to say to the FIA that all the teams are unanimous in agreement to cut the costs. Do whatever you want – come back to us with a proposal that for sure can decrease the costs in a heavy, heavy way. Then we adjust ourselves.

“We have to achieve a goal to decrease in a heavy way the costs.”

What I believe Luca is advocating is a return to pure racing with a specification that relies more on the engine and mechanical grip of the cars than the black art of aero, CFD design and exotic materials that engineering wonks crave. Now, this is a slippery slope because Formula 1 has always been about innovation and to choke that would be to change the DNA of the sport.

Where is the happy medium? Can we create a regulatory oversight and specification of the chassis that would allow for unfettered innovation without the cost escalation and dependency on aero-efficiency that creates boring racing?

Instead of constructs such as super aggressive high degradation tires and DRS, could we reduce the overall downforce created by the cars by 50-60% through suspension monitoring in real time? What if the engine, braking, “higher” degradation tires (but not super high) and mechanical grip overall were the innovation blocks left to exploit instead of aero? Boring huh?

I once asked a Ferrari engine man about aero and he said that they do learn very much by this and it does translate to road cars even if you think it doesn’t. Each year they learn more about aerodynamic efficiency and how to make the car work better in the air. Who knows? Maybe aero isn’t that bad after all.

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An F1 fan since 1972, NC has spent over 25 years in the technology industry and as a CTO, he focuses on technology integration in commercial workspace design, AV systems integration, digital media strategies, technology planning, consulting, speaking, presenting, sales, content strategy, marketing and brand building.
  • Rapierman

    Well, if you can’t touch the aero, and you can’t touch the engine, then the only thing left is the personnel. Where can you cap the cost on that? And how, exactly, do you measure “downforce” in a meaningful way?

    If the goal is to cap costs, then you’d have to say that you can spend only so much money on the car overall, and force them choose what percentage to aero, what percentage to power and what percentage to personnel. Otherwise, I just don’t see how it’s going to be done. Then again, as you’ve seen, the averages vary, depending on the monetary resources made available. If a team could put in no more than the team with the least amount of resources available to them, then it might make things even, but the ones screaming the loudest are the richest teams because it’s an advantage to them.

    While we’re at it, though, what about the guys who ask for umpteen-billion dollars to just enter the series for the cars? Couldn’t they also cut back and, in turn, make more available even to the poorest of teams? I’d bet that would create a serious change in the competition.

  • Tom Firth

    He is 100% correct, a budget cap in F1 will not work. I don’t believe some of the other stuff he’s advocating is correct, it is interesting that he made a point of mentioning Chrysler though, since Ferrari’s owners FIAT acquired it. I wonder why he mentioned it. seems abit out of place in the context.

  • jonnowoody

    It’s easy to beat the cost cap. Simply put up your hand to say ” We’re Ferrari.” and claim an extra 10%.

  • Plonk

    When they banned electronic suspension, electronic traction control, electronic gear selection and electronic steering it was to make the sport still partially a driver’s sport. They realized that the computers could do a better job than the drivers. At that point they stopped F1 being a totally open cutting edge technology sport. As they should. When a computer can drive the car better than a human then the driver is not needed. That is what cutting edge technology can already do now. Google can do that. So any focus on F1 that isn’t about high tech materials or super computers or full scale wind tunnels is about keeping F1 a driver’s sport. As it should be. Otherwise just open it up and let the computers drive the cars and forget about human drivers. The DNA of F1 ceased to be about cutting edge technology the year that Senna died. That was when Williams had to turn off the computers that helped drive their cars. A simple cheap formula with the best drivers in the world is what people want to see. A simple cheap formula with the second best drivers in the world is not interesting. Fans want to see the best drivers in the world, nothing else.

  • Cipher

    Here’s an idea, bring back unlimited testing and let the 4 big money teams test to their hearts content, but require them to host 2-3 other teams at each test and cover the costs for those teams to participate in the test. It’s not necessarily a perfect system but it allows all teams to join in on the testing circus, and the testing will become more efficient for the top teams as they will need to make the most out of a larger investment, I think it’s an idea that’s at leas worth discussing.