The 2014 regulation changes may or may not be your cup of tea but one thing for sure is…they have been darned expensive. The new power unit regulations saw manufacturers and teams spend small fortunes on the systems and while any change in regulations prompts a raft of expenses, this year’s changes were massive.
This all came at a time when Formula 1 was very concerned about the cost to participate in the series and many smaller teams on the ropes an in the red which led to some to the demise of HRT and USF1. The 2008 financial crunch also led to the departure of Toyota, Honda and BMW.
To these ends, F1 has been kicking around the idea of a cost cap for the teams but they’ve been unclear on how best to institute this cap with minimal intrusion into a teams balance sheets. After many discussions over many months, FIA president Jean Todt has revealed that there will no longer be a cost cap. The BBC’s Andrew Benson has the call:
“if the commercial rights holder [Bernie Ecclestone] and six teams are against it”.
“It’s mathematics. In this case, no more cost cap.”
Under F1’s new governance structure, the six teams in the strategy group – Ferrari, Red Bull, Mercedes, McLaren, Williams and Lotus – have one vote each, while Ecclestone and Todt have six each. Votes pass by a simple majority.
“In a way, I am disappointed because it may be more difficult to achieve the reduction which I feel is needed,” said Todt.
“But everyone says we are all in favour of reducing the cost, and through sporting regulations.”
Benson rightfully points out that the new Strategy Group is a creation to prevent gridlock in F1 under a unanimous vote format. To be honest, F1 has really pinned a lot of power on this group and deferred several major decisions to this working body. Cost caps, which was previously the main cause of the now-defunct Formula One Teams Association (FOTA).
Benson goes on to discuss FOTA and their Resource Restriction Agreement but in short, the group did well until it was time to talk team money and that’s when the wheels fell off. Makes one wonder if the Strategy Group will find it easy to simply make rule changes that will curtail costs because the 2014 regulations certainly were no model of cost reduction efficiency.