FORUMula1.com - F1 Forum

[cheekybru]

was just wondering if anyone knew what sort of a profit / loss the big f1 teams make in an an average F1 year, not counting the global effect of marketing their brand, do you think it costs mclaren / ferrari to run at the front year after year, and they do it just for the global branding? or does the sponsership really offset the HUGE costs that are involved? anyone got any idea?

[tpherson]

They can't spend money they don't have, at least not forever. My guess is that the McLaren's and Ferrari's of F1 make money. The small/medium independents may lose money, but are bankrolled by wealthy owners who are in it for the sport. I am impressed at Virgin's (Richard Branson) restraint in its F1 endeavour. IF I had his kind of money I'd drop a load on an F1 team and make it a champion, kind of like Red Bull. Each of these billionaires can justify the money spent by saying it is for promoting their underlying business. It may pay in these cases, but I bet a lot of ego is involved, at least at Red Bull, in pursuing an F1 championship. Same goes for Force India, I'm sure the racing operations are losing money, but they have a rich owner to bankroll the operation, at least until his money runs out.

How to you make a small fortune in racing? Start with a large one.

[cheekybru]

i see what your saying, but with companies as big as Mclaren and Ferrari they could make a loss of millions per year and just have it out of their advertising buget, companies like this have unlimited pockets when it comes to keeping their brand in the public eye, i wouldnt be suprised if the big teams loose money

[headless]

All teams are supposed to get a cut of the money from the F1 over championship.

[EwanM]

I can give you some figures from a couple of years ago if you want? However I don't have my notes to hand so it'll have to wait until I get home.

[Selcouth_Feline]

They also get money from Bernie (?) don't they? I think they get a cut of TV sponsorship money according to how many points the team got during the previous year, hence why even a point for the small teams is a really big deal.

[headless]

I think they get a cut of TV sponsorship money according to how many points the team got during the previous year, hence why even a point for the small teams is a really big deal.

Thats what i meanto say.

[cheekybru]

I can give you some figures from a couple of years ago if you want? However I don't have my notes to hand so it'll have to wait until I get home.

yeah id like to see this thx

[EwanM]

I can give you some figures from a couple of years ago if you want? However I don't have my notes to hand so it'll have to wait until I get home.

yeah id like to see this thx

NP i'll have a look for you.

[Jabberwocky]

I believe they get money from FIA for position in championship.

Money from CVC (Bernie) plus IIRC the top 9 teams get a set amount of room on cargo to and from races

Ferrari, I think Monty said a few years ago that they did not take any money from FIAT so should be classed as an independent. I don't know if that was Ferrari F1 or Ferrari as a whole.

Mclaren and Williams as they do not do much apart from F1 must be able to support themselves.

Redbull, STR, Force India, are just expensive bill boards for there owners.

Toyota, Renault, BMW are expensive bill boards but I would imagine that they do get some sort of R+D to the parent company. wing tunnel use etc

Brawn, will have to wait and see, as I think this year Honda have bankrolled them next year is going to be a new begining. but with the money from FIA and CVC should be ok

[Gaz]

I believe they get money from FIA for position in championship.

Money from CVC (Bernie) plus IIRC the top 9 teams get a set amount of room on cargo to and from races

Ferrari, I think Monty said a few years ago that they did not take any money from FIAT so should be classed as an independent. I don't know if that was Ferrari F1 or Ferrari as a whole.

Mclaren and Williams as they do not do much apart from F1 must be able to support themselves.

Redbull, STR, Force India, are just expensive bill boards for there owners.

Toyota, Renault, BMW are expensive bill boards but I would imagine that they do get some sort of R+D to the parent company. wing tunnel use etc

Brawn, will have to wait and see, as I think this year Honda have bankrolled them next year is going to be a new begining. but with the money from FIA and CVC should be ok

Brawn are getting Merc Money now...

[darwin dali]

I believe they get money from FIA for position in championship.

Money from CVC (Bernie) plus IIRC the top 9 teams get a set amount of room on cargo to and from races

Ferrari, I think Monty said a few years ago that they did not take any money from FIAT so should be classed as an independent. I don't know if that was Ferrari F1 or Ferrari as a whole.

Mclaren and Williams as they do not do much apart from F1 must be able to support themselves.

Redbull, STR, Force India, are just expensive bill boards for there owners.

Toyota, Renault, BMW are expensive bill boards but I would imagine that they do get some sort of R+D to the parent company. wing tunnel use etc

Brawn, will have to wait and see, as I think this year Honda have bankrolled them next year is going to be a new begining. but with the money from FIA and CVC should be ok

Ferrari is a scuderia that produces expensive toys for rich people...

[tpherson]

i see what your saying, but with companies as big as Mclaren and Ferrari they could make a loss of millions per year and just have it out of their advertising buget, companies like this have unlimited pockets when it comes to keeping their brand in the public eye, i wouldnt be suprised if the big teams loose money

Teams are ultimately supported by advertising and manufactring. I don't know that the entertainment value is enough to support the teams at this level. that being said, they have to justify to the advertisers the cost to sponsor a team. Teams such as Toyota and BMW are evidence that even manufacture backed teams have to justify their value to the advertiser. BMW has chosen that the cost to comete at the top level does not provided the return they need as an advertiser, and as such have pulled the plug. Team budgets must be based on the revenues produced, they cannot over time continue to operate at a loss year after year. Some teams are backed by manufacturers or industry with very deep pockets, and as such may be able to provide in what seems an unlimited fashion, but ultimately that is not the case. As soon as the board of directors of the manufacturer or team sponsor or team owner sees that they are not getting an adequate return on their investment, they will pull the plug. You can see that teams without this major source of funds cannot compete. This year is a bit of an annomoly based on the rules changes that htrew everything up in the air, but you can guarantee the teams with the largest budgets will soon be at the front of the field again.

I guess my point is, economics say teams can't lose money forever, revenues have to come from somewhere to pay the bills. Some teams just have access to what seems like an unlimited source of funds by virtue of their relationship with a manufacturer, and when money runs short can just ask for more. Some teams don't have that resource and just have to make due with what revenue the team can produce in an open market. these teams tend to be at the back of the field due to their limite resources compared to the other teams.

[Jabberwocky]

how much does advertisement actually work though?

It is not as if we all go outside for a smoke of a Marlbrough, whilst using my Vodaphone phone. Then coming back to book a holiday at airasia whilst drinking a kingfisher beer.

[Denthúl]

how much does advertisement actually work though?

It is not as if we all go outside for a smoke of a Marlbrough, whilst using my Vodaphone phone. Then coming back to book a holiday at airasia whilst drinking a kingfisher beer.

That's pretty much how I spent the Signapore Grand Prix weekend.