17/06/2012
NEWS STORY
There has been a lot of talk about cost-cutting in Formula One over the past week. On Tuesday Ferrari president Luca di Montezemolo urged F1 to cut costs in the wake of the economic crisis sweeping across Europe. "The world economic situation and that of Europe is very serious and F1 cannot ignore the fact," he said adding "we need to tackle urgently, and with determination, the question of costs." This was followed by a statement on Friday from the World Motor Sport Council (WMSC) which said that F1's governing body the FIA "is having active discussions with teams regarding cost control...The intention is to help all teams participate in the Championship in a fair and equal manner."
FIA president Jean Todt is a key member of the WMSC so it is no surprise to learn that he shares the view in the statement. However, what is more surprising is the conclusion he draws from the current state of affairs in F1.
Unlike his predecessor Max Mosley, Todt rarely gives interviews but he made an exception recently when Top Gear magazine, the official publication of the famous BBC television programme, was granted an audience with him. The meeting took place in Todt's wood-panelled office in the FIA's headquarters on the Place de la Concorde in Paris and the subject of cutting costs in F1 soon came up.
"For me, F1 is too expensive," Todt is reported to have said. He added that "if we don't act, we may find a situation where we cannot pretend to have twelve teams." It's a grim prediction but one which is shared by many paddock insiders.
The really interesting thing is that Todt implied we don't have to wait for a team to pull out of F1 to see the impact on the sport of the financial crisis. Todt indicates that the evidence is already right before our eyes as he says that "the drivers are supposed to be the most prominent in all of racing, but more than half of them have to pay to allow the teams to participate. We have started to work on this, but F1 is a triangular agreement between the teams, the commercial rights holders and the FIA. If we want to make it work properly, everybody has to work in the same direction."
Todt may well have a point as according to F1's industry monitor Formula Money, pay-drivers this year provided around £58.5m ($92m) of the teams' estimated sponsorship tally of £554m ($871m). Let's not forget that the pay-drivers are concentrated at the back of the grid where budgets are tightest so it is indeed likely that some of the back-markers could not survive without their income. The payments from pay-drivers are crowned by an estimated £28.6m ($45m) from Venezuelan oil company PDVSA to Williams which runs the South American country's leading driver Pastor Maldonado.
Although several outfits may depend on money from pay-drivers, many in F1 would disagree that there is any connection between the prominence or ability of the drivers and the fact that they have to pay to allow the teams to continue racing. After all, Maldonado, for example, has won a race this year and, looking back to the beginning of his career, double-world champion Fernando Alonso started racing with Minardi and brought money with him as was common at the team at that time. In fact, it is highly ironic Todt is suggesting that drivers don't cut it given that there are more champions and race winners in F1 now than ever before.
An alternative interpretation of Todt's comment could be that since the drivers are the most prominent in the world they should not have to pay to keep the teams going. It does not look like Todt meant this as he does not say that the drivers are the most prominent in all of racing but that they are supposed to be the most prominent in all of racing. This suggests that he thinks more than half of the grid are not at the top of their game and that alone is a warning that, once again, costs have already spiralled out of control in F1.