FIA President Max Mosley responded almost immediately to Honda’s shock exit from Formula One today by laying down the foundations for British engine supplier Cosworth to provide teams with a cheaper standard engine from 2010.
The FIA expects the deal to significantly reduce the teams’ budgets as Formula One feels the strain of the global financial downturn and a stuttering motoring industry.
Within hours of Honda’s withdrawl from Formula One activity and the sale of Honda Racing (see separate story HERE), Mosley wrote to the teams proposing a deal with Cosworth that would see budgets slashed drastically.
The FIA is now in exclusive talks with the Northampton engine supplier after the tender process for a standard engine ended last month.
Mosley says that the teams’ annual engine and transmission costs could be reduced to under £6 million. The standard engine would not be mandatory, and if only four teams sign up for the supply in 2010, then the annual charge for a three year deal would be just £5.49 million. The cost could be even less if more teams sign up.
“We have completed the tendering process and are now in exclusive negotiations with Cosworth together with Xtrac and Ricardo Transmissions (XR) to supply a complete Formula One power train starting in 2010.
“The engine will be a current Formula One engine while the transmission will be state-of-the-art Formula One and a joint effort by two companies which already supply transmissions to most of the grid.
“The cost to each team taking up this option will be an up-front payment of £1.68M (€1.97M) and then £5.49M (€6.42M) per season for each of the three years of the supply contract (2010, 2011, 2012). This price is based on four teams signing up and includes full technical support at all races and official tests, plus 30,000 km of testing.
“The annual cost will reduce if more teams take up the option, for example to £4.99M (€5.84M) per team with eight teams. It will further reduce if less than 30,000 km of testing is required. Neither engine nor transmission will be badged.”
When the idea of a standard engine was originally proposed the Formula One Team Association (FOTA) reacted angrily to the perceived imposition with Ferrari and Toyota threatening to quit the sport.
But with Mosley insisting that the deal would not be mandatory, and in light of Honda’s withdrawl from the sport, the teams may be more accepting of the proposals, especially the smaller outfits.
Those teams who continue to use their existing engine will not be allowed to exceed the performance limits of the standard units.
Teams must indicate their preference to run the standard engine by December 11.
