24/01/2009
NEWS STORY
When Honda announced its decision to quit F1, citing the global financial crisis, all eyes turned to some of the other manufacturers in F1, particularly Toyota, whose parent company recently announced the first trading loss in its history.
While there were fears regarding the car manufacturers, there was also serious concern over the last of the true privateer teams, Williams. In addition to losing a number of sponsors, several of which were Icelandic, and were therefore hit particularly hard by the banking crisis, Lenovo moved to McLaren, while there is continued speculation as to the deal with the Royal Bank of Scotland (RBS) which - under the guidance of Sir Fred 'the shred' Goodwin - has suffered the biggest losses in British banking history.
Speaking at the launch of the Grove outfit's 2009 contender earlier this week, the team's Chief Executive Adam Parr moved to allay fears over the team's future, claiming that funding for 2009 and 2010 is already in place.
However, speaking to the Financial Times, Frank Williams had admitted that but for the introduction of a swathe of new rules aimed at significantly cutting costs, his team would have struggled to survive.
"Given the financial pressure we are under, the consequent changes to the rules to reduce the cost of racing are a major benefit," said Williams.
"We need to make a profit," he continued. "To be successful and to be certain of staying in business, we need to be successful financially too. So, we need to make a profit every year. We've lost in the last two years, or three, I think, but we have the reserves and resource to manage that."
Parr admitted that having borrowed heavily in the last two years, the team has reached the point where it would not have been prudent to continue borrowing.
"I think it would be fair to say we have reached a point where further borrowing is not acceptable to the board of this company," he said.
While having lost sponsors, Dutch electronics group Philips has upgraded its sponsorship of the Grove outfit, the company having carefully evaluated the worth of its partnership with Williams.
"They have measured their sponsorship to death," said Mr Parr. "They know exactly what impact it's had on their bottom line. And they may decide to increase on that basis."
Despite the loss of Lenovo, Petrobras and Baugur, however, Parr remains confident.
"We need to bring in some additional partners for lots of reasons," he admits, "but fundamentally, with the cost savings that are going on in the sport, we have a sound basis and what I would call a no-frills budget in place for the next two years."