20/04/2010
NEWS STORY
After being knocked off the top spot of F1's points standings at last weekend's Chinese Grand Prix, the decline in Ferrari's on track performance has been plain for all to see. However, what has only come to light today, courtesy of a report in the Telegraph by Pitpass' business editor Chris Sylt, is that the Italian team's financial performance has also been in reverse.
The report is based on research by business intelligence firm Dun & Bradstreet which ranks F1's teams by the length of time it took them to settle their bills over the period from December until the beginning of April this year. Despite having the largest budget in F1, estimated at £260m by the sport's industry monitor Formula Money, Ferrari pays its bills on average 16 days late - slower than any other team.
Ferrari is followed in the payment ranking by McLaren and then Mercedes which settles its bills nine days late according to Dun & Bradstreet (see box). These teams have the sport's second and third highest budgets indicating that in the current economic climate it may not be sustainable for car manufacturers to invest in F1. After all, a healthy business with sufficient cashflow should not be paying its bills weeks after the due date.
Toro Rosso, the team owned by energy drinks company Red Bull, is the quickest to pay with its bills settled on time. Second quickest is its sister team Red Bull Racing which finished in its highest-ever place of second in F1's standings last year and now settles its bills seven days quicker than in September 2009 when Dun & Bradstreet released its previous payment analysis.
Ferrari and Renault are the only two teams which settle their bills slower now than last year with payment time for both increasing by two days. Renault's budget has fallen by £90m in the past year as a result of a reduced involvement from the car manufacturer which sold an undisclosed stake in the team in December to Luxembourg-based Genii Capital.
Although McLaren is the second-slowest team to pay, it has had the biggest improvement in payment time with its bills now settled 12 days quicker than last year. Dun & Bradstreet suggests that McLaren has been dragged down by its brand extension plans which saw it launch a £150,000 super car last month. The report claims that "the plans of co-owner and managing director Ron Dennis to sell upscale sports cars to wealthy motorsport fans put pressure on the situation."
Lotus, Virgin and Hispania, the three new teams which joined F1 this year, are not ranked since they do not have a long enough payment history to analyse. Time will tell how many of them will be around long enough for this to take place.
2010 F1 Team Budgets and Payment Speed
| Team | Est. 2010 budget | No. of Days bills paid after due date |
| Ferrari | £260m | 16 |
| McLaren | £137m | 14 |
| Mercedes | £173m | 9 |
| Williams | £85m | 6 |
| Renault | £134m | 5 |
| Red Bull Racing | £134m | 1 |
| Toro Rosso | £82m | 0 |
| Force India | £78m | N/A |
| Sauber | £46m | N/A |
| Lotus | £52m | No Data |
| Virgin | £36m | No Data |
| HRT | £33m | No Data |
Source: Dun&Bradstreet F1 Paydex and Formula Money