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[racechick]

I wonder if they new teams requested for the budget cap and that is one of their conditions of entry into the championship. If that is the case, then Bernie and his crew have to figure out if F1 can survive without the big teams...

All of them want to run Capped.

So I guess you think the FIA will buckle?

Certainly not. Either they both will or The Scuderia will.

Im not so sure Ferrari will buckle. I think the FIA will have to compromise. Then Ferrari will be the bad boys made to stand in the corner. And round and round we will go, un til the dictator goes or the teams do.

[Jensonb]

F1 Fanatic has clled it right. I urge you all to read this and take it on board:

F1 Fanatic Post on the Potential for a Split

[McLaren Fan]

F1 Fanatic has clled it right. I urge you all to read this and take it on board:

F1 Fanatic Post on the Potential for a Split

I agree with a lot of that. And, to be honest, I don't think any Formula One fan or team really wants to see a split. Ideally, things would be sorted out. The FIA needs to get its house in order, the FOM needs to come into the 21st century and stop being so greedy, and the teams obviously have to cut costs. The likelihood is that some agreement will be reached. For starters, the teams aren't opposed to a budget cap. What they are opposed to is Mosley's version of it. However, I really don't think Ferrari are bluffing. FIAT and Ferrari are losing money, and almost all of Ferrari's marketing comes from Formula One. If the sport is bastardised as Mosley wants, Ferrari haven't got a lot to shout about, so competing in Formula One is much less attractive and much less useful.

[Jabberwocky]

how about looking at it this way, If Ferrari gets its way and the budget cap is written off. We can say good bye to Brawn.

Romours have it that Brawn has sold its whole sponsorship space to Virgin for £30 Million (that figure was before the budget cap went to 40 Mil) so lets say that Brawn are trying to ink a deal with Virgin for 40 mil. What happens when the budget cap is blown out of the water. Is Virgin then gonna pay 100 mil to keep the team up to speed? or are they gonna say, nope 30 mil and that is the end of it.

I would imagine that Torro Rosso might be absorbed by Redbull if it happened also.

[darwin dali]

Hmm. I'm not so sure. Nobody is bigger than the sport - driver or team. Sure, Ferrari are a legendary marque and it would be very disappointing not to have them, but Formula One could survive without them. When Senna died, all the doom mongers were saying, and with quite some authority, that Formula One was finished. Fifteen years later, the sport is bigger than ever.

I never believed this (with quite some authority).

[Frosty]

So I guess you think the FIA will buckle?

Certainly not. Either they both will or The Scuderia will.

I'm sure Ferrari will be okay with negotiating but at the minimum they will need to get rid of the two tier system and negotiate a budget cap that Ferrari will be happy with. If that does not happen then I'm sure Ferrari, Red Bull and Toyota will walk this is business and in business you can't make threats such as these and then not follow them through if you ever expect to be taken seriously in negotiations again.

[Jensonb]

how about looking at it this way, If Ferrari gets its way and the budget cap is written off. We can say good bye to Brawn.

Romours have it that Brawn has sold its whole sponsorship space to Virgin for £30 Million (that figure was before the budget cap went to 40 Mil) so lets say that Brawn are trying to ink a deal with Virgin for 40 mil. What happens when the budget cap is blown out of the water. Is Virgin then gonna pay 100 mil to keep the team up to speed? or are they gonna say, nope 30 mil and that is the end of it.

It's good night Frankie too. Williams have said in no uncertain terms that they are most likely screwed if a cap doesn't go through.

And with the loss of RBS...They most definitely are.

[McLaren Fan]

Hmm. I'm not so sure. Nobody is bigger than the sport - driver or team. Sure, Ferrari are a legendary marque and it would be very disappointing not to have them, but Formula One could survive without them. When Senna died, all the doom mongers were saying, and with quite some authority, that Formula One was finished. Fifteen years later, the sport is bigger than ever.

I never believed this (with quite some authority).

Yes...

[Frosty]

how about looking at it this way, If Ferrari gets its way and the budget cap is written off. We can say good bye to Brawn.

Romours have it that Brawn has sold its whole sponsorship space to Virgin for £30 Million (that figure was before the budget cap went to 40 Mil) so lets say that Brawn are trying to ink a deal with Virgin for 40 mil. What happens when the budget cap is blown out of the water. Is Virgin then gonna pay 100 mil to keep the team up to speed? or are they gonna say, nope 30 mil and that is the end of it.

It's good night Frankie too. Williams have said in no uncertain terms that they are most likely screwed if a cap doesn't go through.

And with the loss of RBS...They most definitely are.

Williams and the new teams hoping to enter the sport next year are going to be most effected by this announcement they stand the possibility that by 2010 they will either not be able to afford F1 or the sport is in ruin or even both. I think Brawn will be able to survive an extra year without a budget cap they may not be as competitive as they have been this year but they will have enough carry on because of the success of this season.

[scotty]

The simple fact is if the two tier system remains and the FIA don't come to an agreement with Ferrari then Ferrari, Red Bull, Toro Rosso and Toyota will leave. Without those teams the sport will be seriously damaged and I expect the manufactures will not want to take part in a damaged series so they will leave as well. If Ferrari go then FOM will loose a lot of it's contracts leaving F1 and FOM with very little money(the commercial rights holders need that money to pay off debts), teams will not be able to get as much sponsorship money because the fan base will be much much smaller.

Exactly, nobody wins if they quit.

All the parties need to sit down and hash this out.

...and nobody is going to quit! This overreaction is crazy.

So do you think the FIA are going to cave in? If the FIA don't cave in Ferrari and Red Bull will have to walk or they will never be respected in negotiations again their comments are to strong not to follow them through.

I don't think that the £40m cap will ultimately stick, no. Probably the only way this is actually going to work is to set the cap at say, £60/70m, and bring it down step by step, 5-10m a season.

Just out of interest, can anyone tell me what each team spends a season roughly?

[Frosty]

Just out of interest, can anyone tell me what each team spends a season roughly?

This is something in the past I have researched quite a lot but not so much recently.

Toyota 07 cost £300-350 milllion 09 costs £250 Million estimate they have made quite a lot of cuts recently
Ferrari 08 cost around £300-350 million
McLaren 08 £300 Million
BMW £250 Million
Renault £160 Million 08
Force India £80 Million estimate
Williams £120 million 08 but they are spending more than they can afford
Toro Rosso according to a report las week they spent $120 million in 08 equivalent to £80 million
Red Bull spend at least £120 million
Brawn I have no idea what their current rate of spend is but it was £250 million under Honda

[EDIT]
And for comparison Super Aguri running as a customer team were spending around £20 million a year.

[Frosty]

This is a very well written comment on another site by a person called Chris I think it explains very well why so much of the money does not go to the teams.

From how i understand it Bernie took all of his money out when he sold out to CVC (he now gets paid a wage - all be it a very hansom one!!!!)

However i do agree that CVC are stealing money and unfortantly that is not going to change as they have borrowed so much money against F1 as an asset there hands are tied. Also as a side note if CVC dont get paid so much money either due to less revenues from circuits or else then F1 could effectivly be repossed like any asset by the banks one of which is RBS and sold to the highest bidder (i actually think that this is not such a remote a suggestion as it seems) as CVC has borrowed way to much since 1999-2007 CVC bought 52 companies all of which they borrowed almost 100% of the sale price.

And just to show these are not small companies these are only the UK companies that CVC own;
- Acromas (the AA and Saga)
- Debenhams
- Gartland Whalley and Barker (Huge Devloper)
- Hozelock
- IG Group (Spread Betting Firm)
- PC Cox Limited (Engineering Firm)
- Oh and F1!!!!!

Lets remember these are only the UK companies now all of these companies are suffering from CVC massive debt if you were CVC and had to let one go which one would you let fail - my bet would be on F1

So in conclusion to my very long winded post (i am sorry)
- CVC have to keep taking too much money out of F1 to pay debt (milking F1 to 120%)
- CVC may have to sell F1 if the money crisis goes on to long.

If only F1 was owned by the teams and not by CVC they could take a 85% stake of the Profit instead of 50% and then they could have a 100million budget of which 60million could easily come from TV revenue. But if that was the case Bernie would not be a billionare.

[racechick]

This is a very well written comment on another site by a person called Chris I think it explains very well why so much of the money does not go to the teams.

From how i understand it Bernie took all of his money out when he sold out to CVC (he now gets paid a wage - all be it a very hansom one!!!!)

However i do agree that CVC are stealing money and unfortantly that is not going to change as they have borrowed so much money against F1 as an asset there hands are tied. Also as a side note if CVC dont get paid so much money either due to less revenues from circuits or else then F1 could effectivly be repossed like any asset by the banks one of which is RBS and sold to the highest bidder (i actually think that this is not such a remote a suggestion as it seems) as CVC has borrowed way to much since 1999-2007 CVC bought 52 companies all of which they borrowed almost 100% of the sale price.

And just to show these are not small companies these are only the UK companies that CVC own;
- Acromas (the AA and Saga)
- Debenhams
- Gartland Whalley and Barker (Huge Devloper)
- Hozelock
- IG Group (Spread Betting Firm)
- PC Cox Limited (Engineering Firm)
- Oh and F1!!!!!

Lets remember these are only the UK companies now all of these companies are suffering from CVC massive debt if you were CVC and had to let one go which one would you let fail - my bet would be on F1

So in conclusion to my very long winded post (i am sorry)
- CVC have to keep taking too much money out of F1 to pay debt (milking F1 to 120%)
- CVC may have to sell F1 if the money crisis goes on to long.

If only F1 was owned by the teams and not by CVC they could take a 85% stake of the Profit instead of 50% and then they could have a 100million budget of which 60million could easily come from TV revenue. But if that was the case Bernie would not be a billionare.

Very interesting!

[Jensonb]

Just out of interest, can anyone tell me what each team spends a season roughly?

This is something in the past I have researched quite a lot but not so much recently.

Toyota 07 cost £300-350 milllion 09 costs £250 Million estimate they have made quite a lot of cuts recently
Ferrari 08 cost around £300-350 million
McLaren 08 £300 Million
BMW £250 Million
Renault £160 Million 08
Force India £80 Million estimate
Williams £120 million 08 but they are spending more than they can afford
Toro Rosso according to a report las week they spent $120 million in 08 equivalent to £80 million
Red Bull spend at least £120 million
Brawn I have no idea what their current rate of spend is but it was £250 million under Honda

[EDIT]
And for comparison Super Aguri running as a customer team were spending around £20 a year.

Brawn's budget for this season stands at approximately $150 Million (£97 Million) tops. That includes redundancy pay for the staff they had to lay off.

[bud]

thing to take into account for those budget claims is that they are all inclusive. while the budget cap is only for the car development. Lauda has recently backed Mosely and Ecclestone and he did say the budgets after marketing salaries etc would still be around 100-Mil.

I personally would like to see the car budget at 100Mil.