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Liberty fears losing Ferrari: But what does Ferrari fear?

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Formula 1 is due to present its planned engine regulations to the Strategy Group later this afternoon. But the sport’s most famous team has been playing for time in discussions with Liberty Media as a major rival is taking serious interest in the championship’s plans for 2021, as @DieterRencken explains.

Although the FIA’s self-imposed deadline of 30 June for the unveiling of Formula 1’s 2021-onwards power train regulations has come and gone, the date was said to have been met internally by an FIA source, who stated that an “enormous of work had gone into them”, and that “they are quite detailed”.

Asked how many manufacturers had participated in the Working Group, he said “Four [the existing quartet of Ferrari, Honda Mercedes and Renault], plus one.” When pushed he admitted that the “one” was VW Group, represented in the form of Dr Donatus Wichelhaus, formerly VW’s Head of Engine Development (Motorsport), and previously co-opted to Porsche, where he consulted on the LMP1 programme.

Wichelhaus moved to Porsche full-time at the end of 2017, and has an impressive engineering pedigree. The US-based Justia website lists a string of patents awarded to him – as far back as 1993 – while various technical papers relating to engineering research have been published under his name. In short, VW/Porsche would hardly designate such an illustrious and high-ranking physicist to an FIA Working Group without serious intent.

This, though, begs the question: If there were just five manufacturers involved, what about Aston Martin, whose CEO Andy Palmer had regularly expressed interest in taking the British brand into F1 under the 2021 regulations, subject to powertrain costs and complexity being massively reduced, possibly via standardised or proprietary components.

He also pushed for the exhaust-driven MGU-H [heat] energy recovery system to be dropped: “The big cost, the big complexity, it really comes around the H,” he told RaceFans. “That’s where you’re seeing unreliability, it’s where you’re seeing costs, and for what level of return?”

Although the FIA has dropped the MGU-H – albeit not without initial push-back from existing suppliers, particularly Mercedes – the costs of supplying F1 power units will still be substantial, and thus it was no surprise that Palmer recently indicated that Aston Martin would not be pursuing the project.

Donatus Wichelhaus
Porsche engine expert Wichelhaus attended F1 rules talks
“It doesn’t look like the new regulations will be of interest, sadly,” he said. “Aston was interested [in F1] on the basis that costs would be controlled and that the formula would be one part of an equation that would put control back into the hands of the driver.

“I don’t see the costs coming down far enough with the regulations I’ve heard discussed, and I do see that the opportunity to spend a fortune chasing down a tenth of a second a lap will remain.”

These comments tie in with our source’s contention that only five manufacturers were present at recent meetings. Indeed, during the FIA team principals press conference on Friday in Austria Christian Horner, whose Red Bull team is (title) sponsored by Aston Martin, expressed fears that the post-2021 regulations would be “watered down” when asked to summarise Liberty’s first 500 days as F1 owner.

“I think what’s by far Liberty’s biggest challenge is how to address the future; how to address 2021,” he said in response to a question from RaceFans. “I think the problem, and the risks I see, is if the FIA and the promoter aren’t fully aligned, we end up with compromises and vanilla-type regulations.

“I think there needs to be a real clarity going forward as to what the sport is going to be, what are the regulations going to be, that both parties ultimately have to buy into? Liberty paid $8 billion for this sport. They’ve got to turn it into something that’s even more attractive,” he added.

“Vanilla-type” means different things to different people, but in this case it is clear Horner is concerned that the regulations will stray from the original intention: a superb spectacle week in, week out, facilitated by regulations that create a cost-effective, sustainable Formula 1.

Hence his next comment: “There’s revenue issues that need dealing with. The FIA, as the governing body, they’ve got to be fully aligned with that, and what concerns us is discussions of where things are going with engines, where things are going with chassis regulations. Everything seems to be getting watered down from what the initial concept [was]. I think the next 500 days are going to be very telling, post-2020…”

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The word in the Austria paddock was that the engine regulations – in their current state of completion, for there will always be clarifications – will be presented to the Strategy Group scheduled for Wednesday. The key is the word “presented” – not “voted” – for there exist doubts as to whether the Strategy Group, whose mandate expires on 31 January 2020, is empowered to votes on issues that kick in after that date.

The same applies, obviously, to the chassis and sporting regulations – such is the complexity of F1 that three different regulations, each involving different player groups, are required – and while there is more urgency on engine regulations due to longer lead times and commitments required for power units, it is imperative that F1 is not lulled into a false sense of security, then be forced to rush matters as in the past.

Chase Carey, Christian Horner, Paul Ricard, 2018
Horner believes Liberty’s plans are being “watered down”
Then there are commercial discussions. It is no secret that Liberty needs to reduce its costs, with by far the largest outgoing being the bonuses and revenues paid to teams, making teams payments the obvious starting point.

Of F1’s approximate £1.35bn turnover, the teams collectively share – albeit inequitably – around £745m. Reduce that by, say, 20 per cent, and Liberty is £150m better off. Per annum.

Reducing payouts is, though, predicated upon a) reducing the costs of competing via budget caps or similar, and b) reducing the bonuses paid to the major teams, with Ferrari, Mercedes, Red Bull Racing, McLaren and Williams receiving annual bonuses varying between £75m and £7m depending upon status.

While all teams pay lip service to costs cuts, the majors are less receptive to having tens of millions wiped off their incomes.

According to one team principal who spoke on account of anonymity, Ferrari president Sergio Marchionne at one stage dug his heels in and simply refused to meet with Liberty. Although he is believed to have had dinner with Liberty CEO Chase Carey recently, our source believes that Marchionne’s strategy is to drag out the talks until it is too late.

“Liberty fears losing Ferrari, so Chase is playing along, but deep down Ferrari fears Porsche, and believes the longer they can drag out the talks, the less likely it is that Porsche will enter F1,” was his (logical) explanation.

When this theory was put to another team boss, his response was “Yes, Marchionne has an agenda, that’s for sure, and he knows how to play hardball.”

Should “vanilla” F1 comes to pass and Ferrari feels compelled to leave, Marchionne may just pull the plug. That is, though, one thing – but, seen from his perspective, why should he open the door (prematurely) for the only market competitor Ferrari truly fears?

Aston Martin is one thing, but Porsche is a completely different animal entirely – despite the Stuttgart and Maranello marques both having rampant stallions in their logos…

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Let us assume a Porsche entry is on the cards – does the company enter as team owner or as engine supplier? Both options have further multiple choices: as team owner Porsche could elect to build its team from scratch, either basing it on its existing (Le Mans- and WEC-winning infrastructure), or go for a turn-key project.

Whichever way it may go demands clarity on engine, chassis, sporting and commercial structures. And demands it ASAP, if not yesterday.

Timo Bernhard, Porsche, Nurburgring Nordschleife, 2018
Porsche left WEC but has put its LMP1 car to good use
Another alternative is to acquire an existing team – there are plenty about, some more suitable than others. Whichever team is settled upon, it would require upgrading to match Porsche’s aspirations, and, again, that takes time and money.

Thus, any delays in agreeing commercial terms plays into the hands of existing entrants, particularly those who see a Porsche F1 entry as a very real threat in terms of performance and status.

Should Porsche, though, elect to stick to the engine supply route it equally faces options: supply a team(s) on a customer basis and/or enter into a “works” agreement with a major.

Here, too, Porsche requires clarity on commercial matters such as whether Liberty will subsidise engines suppliers as previously mooted. Equally, Porsche needs to gauge whether teams have sufficient income to cover engine lease bills.

By the same token, F1 needs to attract at last two new teams to insure against natural attrition. During its 68-year history, F1 has lost an average of a team per year – yet since 2010 “only” three teams have disappeared.

More than a few are, though, hanging on by their fingernails hoping for the tide to change in 2021, and F1 needs to attract newcomers to ensure healthy, competitive grids.

The issue, though, is who pays them? The current revenue structure pays to tenth place; with ten teams on the grid, conveniently all entrants receive slices to larger or lesser degrees.

However, assume one or two newcomers are attracted by Liberty’s post-2021 vision – and the FIA approves applicant(s) it/them as it did with Haas – that would make more teams than currently catered for by the prevailing payment structure. Saliently: what if Porsche is one of the newcomers?

Under those circumstances, should the money pot be divided by 11 or 12 as the case may be, or should up to two teams be left in the financial wilderness to go under? The obvious answer is that Liberty should increase the size of pot to cater for the expanded grid, but the reality is that the commercial rights holder is under pressure to increase share price, and additional outgoings hit returns.

Start, Red Bull Ring, 2018
Liberty wants to attract more teams
Equally, one simply cannot imagine a Ferrari or Mercedes willingly forfeiting a portion of its (already reduced) income to cater for a newcomer, be it Porsche or some dreaming entrepreneur. Yet the alternative is for F1 to attract no new teams, and that will ultimately prove suicidal for the sport. Imagine F1 2018 without Haas and only nine teams…

The bottom line is that F1 simply cannot afford to rest on its laurels after presenting the 2021 engine regulations in London, possibly even as you read this. True, finalising them would represent a major step in the direction, but it would still be only a single step in a multi-faceted journey.

In 2010, after he returned to F1 as team owner in the wake of BMW’s withdrawal from F1, I asked Peter Sauber what had changed most in the three years he had been away from the sport.

He answered by telling me what had not changed: “Formula 1’s inability to take a decision until it’s too late, and then we’re invariably forced into the worst possible compromise.”

Is history about to repeat itself, all because Liberty is afraid of losing Ferrari, and Ferrari is afraid of going up against Porsche?

Follow Dieter on Twitter: @RacingLines

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Dieter Rencken
Dieter Rencken has held full FIA Formula 1 media accreditation since 2000, during which period he has reported from over 300 grands prix, plus...

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  • 77 comments on “Liberty fears losing Ferrari: But what does Ferrari fear?”

    1. It’s ridiculous that the top teams can vote on anything regarding regulations.

      1. perhaps we should let Ferrari go

        1. Another team could paint their car red and nobody would notice.

    2. So will the new Engine Regs allow for software that detects wether the engine is currently scrutinized by the FIA or is driven on track in anger then?

      1. @mrboerns :-)

        Once they’ve ported it over from being diesel-specific to encompassing petrol powertrains as well.

      2. my diesel German hatchback just came from the mechanic shop because it had a problem in a exhaust valve. I thought it was very funny

    3. “Liberty fears losing Ferrari, so Chase is playing along, but deep down Ferrari fears Porsche, and believes the longer they can drag out the talks, the less likely it is that Porsche will enter F1,”

      Typical Ferrari.

      1. Martijn (@)
        5th July 2018, 8:50

        ‘’ That is, though, one thing – but, seen from his perspective, why should he open the door (prematurely) for the only market competitor Ferrari truly fears”

        Cowards. He should embrace it as a brand that loves fast cars and motorsport. So enormeous old economy thinking, you almost wish they would just go away

    4. Great article Dieter.

    5. Vettel fan 17 (@)
      4th July 2018, 12:02

      Come on. I support ferrari, but they should just tell them “these are the regulations, it’s the best for the sport, take it or leave it”. If it will attract manufacturers then do it. No team is bigger then the sport

      1. @vettelfan17, to flip the question around though, what interest does Marchionne have in making a quick deal here?

        As things stand, he’s got the most incentive to dig his heels in right now – the commercial agreement that Ferrari has means they have the most to lose, whilst the threat of losing their veto rights would hurt given that they’ve traditionally used it as a counter to the block of predominantly UK based teams that were aligned against them.

        Meanwhile, Marchionne knows that Liberty Media will have reservations about how hard they want to be on a team that not only gives the sport considerable prestige, but is also a major supplier and providing significant support to two other teams as well (Haas and Sauber), not to mention they’ve also got a rising star (Leclerc) on their books who has been generating quite a lot of positive headlines for the sport recently. To some extent, there is also a use for Ferrari as a counterweight to Mercedes, both in terms of competition – Ferrari generally being the closest team – and in terms of political balance.

        On top of that, it is well known that, on an international level, Ferrari is by far the most popular team – over a third of fans have identified as Ferrari fans in the past, close to that of the next three most popular teams combined – and a substantial proportion of those fans have indicated that they probably would leave the sport altogether, rather than transfer their allegiances to another team.

        Now, of course a withdrawal from F1 would not be without pain for Ferrari themselves, although the end of the current financial agreement would reduce some of those costs. Ultimately, it seems that what Marchionne is gambling on with his tough negotiating stance is that the cost to Liberty Media if they did push Ferrari too far and Marchionne did pull out would be more damaging to them than it would be for Ferrari, and that nuclear option gives Marchionne the strength to play tough.

        Now, there is certainly a debate on how damaging Marchionne’s stance may be for the wider interests of the sport, but it is to offer a potential explanation for why Marchionne might be taking that stance – it’s that final major threat that makes it worthwhile for him to dig in hard now.

        That, to some extent, makes me wonder if leaking news about Porsche showing an interest of entering is intended to apply pressure on Marchionne via the press. That does shift the situation for Marchionne, since the threat of a walkout becomes less effective if there is another major manufacturer who can enter and would offer a comparable level of prestige and value to the sport.

        If that reduces the potency of any harder negotiating tactics he could employ, it weakens his position and strengthens that of Liberty Media, a move which seems intended to push him towards the negotiating table and to be more yielding. Ferrari has, under Marchionne, had a bit of a troubled and uneasy relationship with the press given that Ferrari has taken a more adversarial approach to journalists, so being able to work the press could put quite a bit of public pressure on Ferrari.

        1. what interest does Marchionne have in making a quick deal here?… As things stand, he’s got the most incentive to dig his heels in right now

          Precisely.

          Whether you look at it from a competitive or business standpoint, all the teams are in it to do the best they can. Ferrari has a huge amount of political capital, and they are more than willing to utilise that to gain an advantage (or prevent a disadvantage). All the teams do the same, to a greater or lesser extent.

          Now, personally, I think it would benefit the sport for LM and FIA to just say “Here’s the rules, play by them or bye bye”. I don’t believe Ferrari will leave: They have threatened to so many times in the past that I just can’t see it. Even if they did, the sport would (IMHO) be in a better place without them, but with a fairer rule set and distribution of funds and power.

        2. “Ultimately, it seems that what Marchionne is gambling on with his tough negotiating stance is that the cost to Liberty Media if they did push Ferrari too far and Marchionne did pull out would be more damaging to them than it would be for Ferrari, and that nuclear option gives Marchionne the strength to play tough.”

          Pure poppycock. Withdrawing from F1 would be devastating to Ferrari’s image, and image is their product. Marchionne is already angering Ferrari customers by continuing to increase the number of Ferraris manufactured each year. Buyers see this as reducing the long-term investment potential of a new Ferrari. No Ferrari owner I can imagine wants to pull up t a fancy restaurant and see two other cars identical to his already parked there. “Hey, Buddy! Park yours around the back.” Ferrari leaving F1 because they can’t face even more competition after failing to win a championship for so many years would be devastating to their brand.

          How about Liberty? I give you the Halo. People said it would ruin F1. People said they would never watch F1 again. Now, we’re halfway through the season and no one even notices the halo. If Ferrari leaves and Porsche and maybe another brand come into the sport, no one will be talking about Ferrari once they have walked away in shame for fear of real competition.

          The stockholders will not allow Marchionne to destroy their brand six months before he retires.

      2. @vettelfan17

        I agree but, you know, status quo.

        > No team is bigger than the sport

        It is true, but it’s also true that if there is a team that is close to being as big as the sport, that team is Ferrari. Or at least this is my partial point of view. It would be very interesting to hear from @dieterrencken if my vision from within Italian borders is close or far from the truth. It would be great to read an article about “Can F1 live without Ferrari? Can Ferrari live without F1?”.

    6. A very well written article. Ferrari? – same as always….

    7. I’ve been fairly lukewarm about the prospects of a Porsche F1 team over the years, but the more I think about it, it would be a fantastic thing for the sport. I don’t think anyone ever really expected Aston Martin to get more involved in F1 than they are at the moment, but the fact that Porsche is still involved in the engine talks (and has got such an important person involved in them) does bode well. With their recent successes in WEC you would think they would have the capability to be very competitive in F1.

      The Porsche brand is tremendous so they will be able to attract a lot of eyeballs to the sport and they have a great racing pedigree. They also have previous in F1 (with their one team in the 60’s, building the all conquering TAG engines for McLaren in the 80’s and failing miserably with its V12 in 1991 with Footwork), so I would actually be a bit disappointed if they decide against it in the end.

      1. @geemac, I think that very few people ever took Palmer’s seriously and viewed his self-important statements as nothing more than hot air from a man seeking publicity at a time when Aston Martin wants and needs to attract attention for their new models and wants to launch an IPO this year.

        As far as I am aware, Aston Martin has not engaged in any of the technical discussions, not just the one that Dieter refers to in his article – suggesting they’ve had no real intention of trying to build an F1 spec engine. Palmer’s probably ridden his publicity train as far as he can and, now that the talks are starting to get more serious, he’s found a convenient excuse for him to bow out without having to actually spend that much time, money or effort on something that was nothing more than a stunt.

        As for the wider discussion about Porsche, the thing is, rumours about F1 and the VW Group have been around for years, but rarely has it ever come to anything of substance.

        After all, the VW Group are known to have participated in the working groups that drew up the current engine regulation package – the very reason why it was originally going to be an inline four cylinder engine was solely because the VW Group representatives asked for that, only for VW to then back out anyway.

        Porsche, too, have made comments suggesting an interest – saying that they did weigh up an F1 engine programme as an alternative to entering the WEC – but as of yet I am still dubious given that talk of VW, or one of the various sub-brands (Porsche, Lamborghini etc.), entering the sport has proven to be nothing more than hot air so far.

        I’m also not sure if it really fits in with what Porsche, or the VW Group as a whole, really want to present themselves as to the public in the longer term either. It is not just F1 that has been struggling to attract new entrants, but quite a few other series have seen declining interest from manufacturers as well – the ACO is having to work hard to get new entrants into the WEC, and I am not entirely convinced that their plans will really work (I suspect that, given the nature of unintended consequences, their efforts to cap spending in some areas will just displace spending into other areas instead, rather than eliminating it).

        Elsewhere, Indycar seems to have largely given up trying to attract new engine manufacturers, having tried to lure more in ever since they implemented the current engine regulations in 2012, whilst over in the US the decision to merge the Daytona Prototype and American Le Mans Series into a single championship was because the individual championships couldn’t sustain themselves due to a lack of manufacturer interest.

        The main series that doesn’t seem to be struggling for manufacturer interest is Formula E – they’ve got the Renault-Nissan alliance, Jaguar, Audi and Citroen already onboard, with BMW coming in next year and Porsche is following on for the 2019-2020 season. Not only is it cheap, it ties in much more neatly with the message that those companies want to send out, whereas most other motorsport series, including F1, are perhaps struggling a little to do that.

        It’s not to say that it is impossible, but in my opinion the odds are probably against an entry by VW – I suspect that, whilst they will show interest, they will probably end up concluding that the costs of competing are not worth the exposure they get and doesn’t quite fit in with the image they want to present well enough to justify the outlay.

        1. Aston Martin was party to the 2021 engine talks via Luca Marmorini, whom AM retained as consultant around a year ago. I think there was an element of intent subject to a long list of boxes being ticked.

          We overlook that the luxury sports car market is evolving – as Porsche and Ferrari go into the four-seat market so Merc has gone into the high end sports car market with AMG. Thus a factor that was previously not there has made it imperative that Porsche at least seriously investigates F1. Ferrari and Merc are trying hard to cut into decision-taking time.

          1. @dieterrencken, the fact that Marmorini was only retained on a temporary consultancy role suggests to me that there was only limited interest at best, especially since Palmer had already indicated that he would prefer a badge engineering exercise (rebranding an engine made by a third party, such as Cosworth or Ilmor) instead. Furthermore, didn’t Luca Marmorini leave Ferrari under something of a cloud after the suggestion – which he did contest – that he was responsible for the relatively poor design of Ferrari’s engine back in 2014?

        2. The Difference now is that Bernie is no longer there! VAG boss Ferdinand Piech hated Bernie and it is well known that he always refused to enter F1 because Bernie was in charge. Now that Bernie has gone…..

          1. @asanator, whilst Bernie might be gone, Ferdinand Piech was forced out of Porsche before Bernie was forced out of F1. Piech had already been losing influence within VW to Martin Winterkorn, with Piech forced out in 2015 after he tried to get rid of Winterkorn, only to find that he’d lost his support and Winterkorn was the one that had the support of the company.

            As of 2017, he’s been forced out of Porsche after he was forced to sell his stake in the company by the rest of his family, so what Ferdinand Piech thought of Bernie or F1 is irrelevant as he has no influence over Porsche or the wider VW Group.

            Incidentally, back in 2015 there were some journalists speculating that Winterkorn might look to move VW towards F1 given that he was apparently much more interested in it than Ferdinand was. Of course, his triumph was rather short lived as he was then forced out over the dieselgate scandal, leaving Hans Dieter Pötsch to take over VW and Matthias Müller at Porsche.

            Now, just a few months ago, Matthias Müller was sacked by Porsche about two and a half years into his tenure in favour of Herbert Diess. Herbert Diess’s nickname is ‘Die Kostenkiller’ – the translation is pretty obvious – and he most well known not only for his very aggressive cost cutting programmes, but also for spearheading BMW’s move into electrification (he personally oversaw their electric “i” division) and now leading both Porsche and the wider VW Group into a much more aggressive expansion into electric vehicles, as well as heavily ramping up their capacity to build electric cars and a move towards producing more SUV’s across the wider group as well.

            Whilst Porsche’s interest in an F1 engine programme might have begun under Matthias Müller, Herbert Diess’s current position would seem to be pointing in the opposite direction – an extremely aggressive cost cutting programme (over €3.7 billion), whilst simultaneously pumping billions into a major electrification programme (the battery production facilities alone have seen €1 billion invested in the past three years).

            The current move of Porsche towards Formula E would seem to fit in far more with his long term strategic vision of the VW Group and Porsche than entering F1 would. Furthermore, investing in an expensive F1 programme would seem to be rather at odds with his reputation for very strict financial controls.

            1. Who are you, anon? Who are you, really?

            2. Anon: while your stated facts are correct (and very well known in the industry), your premise is that post-2021F1 is a cost centre and not a profit centre.

              Sure Diess is ruthless with costs – every CEO should be – if managed correctly F1 can wash its face as Mercedes prices every weekend.

              Long before Diess was even recruited but VW there was Carlos Ghosn was known as Le Cost-cutter. What did he do? Took Renault out of F1 to cut costs and then spent a fortune buying back and rebuilding the team he had virtually given away. Why? Because he discovered that F1 can be cost effective – that is what cost cutters seek: ROI. If they cut ALL costs they’d close the company within months.

    8. This article puts a pit in my stomach, but has me thinking Liberty just needs to draw a line in the sand soon then if Ferrari is playing selfish games, and if Ferrari needs to leave, then surely Porsche will step in to fill the void especially without Ferrari, who they would see has still having too much weight in F1. Liberty should take heart in that. At least Ferrari fears something, so Liberty should have some weight there.

      Bottom line for me is that Liberty has a bottom line, and if Ferrari doesn’t factor into that, which I refuse to believe is necessary, then so be it. Enough has to be enough at some point. It is not the BE era anymore, Ferrari. And nothing Liberty is proposing is going to change your bottom line enough to go…where?…and do better? I hope Liberty tells Ferrari ‘we’re sick of your games. If you’re not with us, you’re against us.’

      1. Enough has to be enough at some point.

        That’s exactly it to me. Ferrari is magical and has been in F1 since the start and bla bla bla. (Que Verstappen teamradio) NO! Enough is enough! This are the (engine) rules, this is how much money you can spend per year and this is the piece of the pie you get. If you don’t like it, goodbye and thanks for the memories! F1 will servive without Ferrari and Ferrari will come back to F1 at some point. If not, then fine.

    9. The whole conspiracy theory that Ferrari is once again the villain and not only that, but is also afraid of Porsche is based on an anonymous source? Spare us… this isn’t Watergate.
      Rule number one in fake news: come up with a story out of thin air and claim it is an anonymous source privy to that information.

      1. Your nickname says it all…plus, as you may (not) know, more secrets get leaked anonymously than through named sources.

        I’ve broken way more F1 news stories via anonymous sources than through named individuals.

        What you choose to believe is your choice.

        1. @dieterrencken I have found over the years that the racefans communtity is the most knowledgable regarding espionage as this is the only site I get called out about my nickname and I use it alot. But perhaps this virtue makes them prone to believe in conspiracies. The Ferrari fears Porsche is an intersting angle but besides this anonymous source of yours nothing else backs it up, not a shred of evidence. So for me making a story out of this seems pretty thin, speculation if you prefer.

      2. Yes, some journalists might resort to such tricks for clicks, but Dieter is a respected journo in the paddock, and such respect isn’t earned by the behaviour you allude to.

        1. Haven’t you noticed that there are clickbait titles in this site lately? For years there weren’t any. What he writes is pure speculation and he has the benefit of knowing that Marchionne will never go on the record confirming or denying it. If he is proven true he broke the story if he doesn’t no harm no foul he gets credit for protecting his source and clicks. So the way I see it it’s a win/win situation for him.

          1. First of all there were three sources – an FIA source, and two team principals – and I see you use the word “perhaps”. Possibly you should judge others on their merits, not by your “perhaps” standards.

            1. @dieterrencken So what you are suggesting is that 2 out of 9 principals plus an FIA official are in position to have discussions with Marchionne. In those discussions he confides in them that he is afraid of Porsche and then, they go on an limp blowing the whistle anonymously?
              Have I understood correctly is this the gist of it?

          2. I agree with your point about the change in tone of headlines across all authors. Apart from that, wild & unfounded speculation is not the kind of behaviour that gets access to team leadership for exclusive interviews, so seeing how Dieter regularly gets one-on-one time in the paddock, it must mean that his writings are on point (teams might not enjoy certain reveals, but they will recognize they are factual). That’s the point that I was making.

            PS: Thanks for a reasonable & civil response, and not getting confrontational.

      3. Where is the conspiracy exactly? Mr. Marchionne is known to be a hands-on business man.

        From a sporting point of view trying to prevent Porsche from joining is maybe unethical. But from a business point of view, you certainly won’t want to have one of your prime competitors (brand wise) to enter the championship that is the most important marketing showcase for Ferrari. And especially one with almost unlimited resources to spend and the motorsport knowledge to know how to spend them.

        To me it makes perfect sense that Mr. Marchionne would try to prevent that, it probably would surprise me more if he didn’t.

        1. No @philby, you haven’t understood it correctly. End of.

        2. Martijn (@)
          5th July 2018, 9:13

          “But from a business point of view, you certainly won’t want to have one of your prime competitors (brand wise) to enter the championship that is the most important marketing showcase for Ferrari.”

          I do not agree. They should embrace it from a business point of view. With confidence. Otherwise just create a Ferrari only competition. All seems very short (and old economy) thinking to me. Holding on to a straw and not bringing Ferrari into the next century

    10. I’m curious why Ferrari fear Porsche so much. I get they are capable, have some glory in F1, and have resources to devote.

      But Renault and Merc have been more successful since the ’80s.

      Perhaps it is the brand? Is this about retail competition? There is only partial overlap in the market segments.

      Maybe it is as simple as Porsche might be the most credible threat. AM was always a long shot to compete with Ferrari.

      1. I’m assuming Porsche has very deep pockets as well as their entry into F1 would be massive news from a marketing standpoint, and take a little more shine off the Ferrari apple like the Mercedes domination has done.

    11. A combination of all your named factors, plus Porsche’s sister is Lamborghini, which is making inroads into Ferrari’s markets

      1. Nice point about Lamborghini. Which name do you think the PU/team entrant would use, if they dip their toes in the F1 waters? Porsche has a wider automobile range so would benefit from that name, but Lambo has performance connotations.

        1. If it was me deciding I would star with VW/Audi when they feel they can win it Porsche/Lambo.

          It something that Renault has in its advantage, if they are mid-table it is ok, in the back of peoples minds it is a Renault finishing behind a Ferrari, that is normal, and they get exposure when they put one over. VW could benefit from the same philosophy and then exploit it with their super car brands.

          Buggati would be cool too

          1. @johnmilk – very nice point, especially as VAG has probably the largest stack of everyday and aspirational brands to use.

            Heck, if their PU turns out to be a dud, they could always brand it a Skoda!

            (Funnily enough, in my country Skodas had a better reputation & brand recognition than VW for an extremely long time, until VAG got very aggressive in repositioning these two brands).

            1. @phylyp it missed me completely, but you solved it: VAG F1 Team, they just need a proper lubricant sponsor and that’s it

            2. If Lamborghini are making inroads into Ferrari’s market, then they’re doing it without participating in F1. So then, does Ferrari don’t need F1?

    12. Wow great news, if VAG enter as well as fuel economy engines will be checked for emissions, they will wipe the floor with everyone as their engines are 2nd to none when tested for emissions.

      Porsche have been scared of F1 their whole history rather picking up easy wins elsewhere when rules are written in their favour or the competition is low.

    13. I was watching a VHS recently from around 1991 & it’s fascinating how many of the ‘complaints’ people had about F1 then are identical to what many complain about now despite how many of those complaining about the state of F1 now regularly go on about wanting F1 to be like it was in the 80s/90s.

      They talk about F1 been too expensive, Too complex, Small teams unable to compete, Not enough about the drivers etc…. Sound familiar?

      For those wondering it was part of ‘The Saga of Formula One’ series, This particular part of that was called ‘Formula One Economics’.

      1. Or is it ‘just’ the BE era from which Liberty naturally needs some time to works it’s way away from and toward their own way of managing the entity. What was, and what is currently, is obviously something Liberty wants to change.

        1. @robbie I think it’s just the way F1 is & always has been to varying degrees & in the long term I don’t really expect whatever Liberty do for 2021 & beyond to really change much.

          The aforementioned program – https://youtu.be/DsXeKjtOOyE

    14. Formula One would be better off if:
      1. The grid were not dependant on the ever-changing ambitions and objectives of automobile OEMs
      2. The sport wasn’t required to pay an annual charge of $750 million for the legacy of Bernie and CVC
      3. The regulator had the guts to implement regulations that would cut team operating expenses by 60%+

    15. Sick of Ferrari tbh. Lose to Porsche or lost from the sport, I really could not care less.

      1. Sure you couldn’t care less. But Liberty Media just spent $8.0 billion on a box of contracts that expire over the next few year and they care very much.

    16. Liberty should do what they think is best for the sport. If the risk is to lose Ferrari, make it tempting enough for 3 new teams to join. Of course they have to think about the risks of losing Ferrari, it is not just one team, Haas would be in no position to compete and Sauber without an engine provider. So if that happens they need a contingency to bring in more engine manufacturers and possibly tempt new independents. For all I care they can bring in Brabham again and paint them red.

      If the speculation on Ferrari commented here turns out to be true, they also need to realise that if Porsche comes on-board they have the opportunity to beat them and they are in the best possible position to do so, would there be any better publicity than that? (even though F1 is no the reason why people buy super-cars, just look at McLaren)

      1. Porsche comes on-board they have the opportunity to beat them and they are in the best possible position to do so

        Didn’t quite work the same way with Mercedes did it? Ferrari enjoy every advantage in the rule book, but still can’t win a title. So, it’s kind of obvious that new competition would worry Ferrari. For a team with such a rich legacy in the sport, they seem really cowardly in their approach.

      2. You sure don’t own a business or never run one, should LM try what you are saying as a listed company the shares will tank straightaway.

    17. Evil as it might be, you can’t blame Ferrari for playing their hand. It’s a war anyway, I bet none of the sucessful people in any organization played “the good guy” and let the other have even the slightest of advantages. If Ferrari fears Porsche, they are not going to leave it all dusted and cleared for them to join in seamlessly.

      It smells dirty but that’s how it is when there are so many millions at stake. They are all playing their own game.

      What I take from this article that struck me close to my heart is that Porsche is seriously considering entering… YAY!

    18. This situation can be better understood, when it is appreciated that F1 (as a race series) isn’t owned/controlled by Liberty.
      It is an entity that is made up from a number of stakeholders – teams, circuit owners, FIA, Liberty.

      Each have varying degrees of input; and varying degrees of clout.
      This creates the perfect scenario for combining clout, to achieve shared goals.

      Some teams may not like the direction being taken by Liberty.
      Consequently, they can combine to force modifications to the goal.
      … and they do.
      This is their right, and the normal modus operandi of the F1 system.

      Therefore, it is to be expected that Ferrari will attempt to stop something happening (if they don’t want it to happen).
      It is unreasonable to cast Ferrari as the villain, simply because they are merely exercising their rights (in time honoured fashion).

      Let’s also not forget, that Liberty wish to create a series that enables any team to win.
      However, that generally means that the cars are equal.
      That is not F1.

      In effect – did Liberty buy F1 commercial rights, with the intention of scrapping it (F1), and replacing it with a series say, based upon IndyCars , but keeping the F1 name?

      Let’s imagine that they did.
      The lower teams might go for it, but the top teams prefer keeping their positions at the top.
      They might accept a series, where the lower teams are in with an occasional ‘shout’ for a top place – but that’s all.

      Who is right; Liberty, or the teams?

      The teams have decades invested in F1 … Liberty are new to the sport.
      They didn’t make Liberty buy F1 commercial rights.

      Liberty should have known what they were getting into.
      … in particular, situations like this.

      As for Porsche
      On the outside, they have little power to influence events.

      “take us – we might stay” (compared to Ferraris long standing commitment).

      Porsche need to take a general decision, to join F1 or not.
      They have the resources to make it work, regardless of the regs.

      Buying Force India would be an easy ‘in’.
      Thereafter, they could work within the system, to steer the series in the direction that they would like – no different to what everybody else is doing.

      1. In effect – did Liberty buy F1 commercial rights, with the intention of scrapping it (F1), and replacing it with a series say, based upon IndyCars , but keeping the F1 name?

        Always wondered about that. Liberty appears to be set on morphing F1 into a motorsports entertainment extravaganza. With less emphasis on the costly motorsports part.

        The pressure to make good on Bernie’s 8 Billion dollar used car payments and provide ROI for shareholders when the license expires in 2021 is immense. Whether Ferrari stays or leaves or Porsche enters or doesn’t, seems more likely that Bernie swoops in to pick up the FOG bankruptcy assets for pennies on the dollar in 2023.

    19. At present, it’s my belief that there’s very little chance of any new engine manufacturers entering the sport, not because of the expense, but rather because it is so regulated, it stifles any chance a new manufacturer has for true innovation.

      What a new manufacturer has to look at when considering entry is “will we be able to demonstrate that we’re as good as or better than the current manufacturers” (which means in reality “will we stack up against Mercedes engines”

      If they were given a more free reign (e.g. use whatever configuration you want but your fuel allowance is x, you can have as much electrical power as you want) then surely we might see some innovators (and even perhaps more road relevance) introduced. They’d be trying to prove “their” way is better rather than (as is the case at the moment) trying to prove that they can emulate what Mercedes does as well as they do.

      Just seems pointless worrying about encouraging other manufacturers as I don’t really see any upside for them.

      1. @dbradock, Exactly, and we only have these restrictions on design because Bernie took 10 times the revenue of each team without having to build anything.

    20. The amount of hate directed at Ferrari for acting like a business is astounding. They are a business first and a race team second and their decisions reflect that.
      As an auto manufacturer, Ferrari and the others must be constantly weighing the value of continuing to invest in petrol based engine technology. I’d imagine there is a growing push within Ferrari, Mercedes and Renault to move to Formula-e and increase the investment in electric power and the tipping point may be something like the removal of the MGU-H, or reduce revenues etc.

    21. I think Liberty should not only fear Ferrari leaving, as it would lead to the collapse of Formula 1, but they should also fear Formula E. Manufacturers are pouring into that sport. Liberty problems will get much worse before (or if) they get any better. I can’t say I’ve got any confidence they can fix anything.

    22. @dieterrencken

      Regarding possible 2021 engine regs:

      I just had a brain wave and want your view on it, but the main part of the MGU-H is that it accumulates heat from the Engine/Turbo’s and converts that into power. Essentially, using that power to charge the batteries. With that been close to been kicked out for 2021, we are back to KERS. Now KERS obtains energy from the Brakes as far as I understand, and you deploy when needed. The only major drawback to that is that if you race on an oval track, you’re racing with the ICE as there are no braking points to charge the batteries.

      MGU-H gets constant energy from Turbo (apparently to be removed), and MGU-K from Braking. I don’t want to be funny or anything, but the wind passing over the car could be seen as another CONSTANT energy source, like a windmill or Hydro power in dams, and is always readily available and not track dependent like the MGU-K. Has this been thought about at all?

      1. Don’t want to be a drag on your energy source, but physics might. The aero design goal is maximum downforce with minimum drag. Energy recovery via aero would require more drag – and more power to overcome the drag.

        1. Fans inside the sidepods to assist with engine cooling and generate power to charge the batteries. Different ways to implement

          1. Sorry Mick but you have it all wrong, the MGU-H does not harvest heat, it uses a turbine to harvest kinetic energy from exhaust gas, the exhaust gas gets its energy from the heat of combustion in the cylinders, the MGU-K does not harvest energy from the brakes, rather it acts as a braking system by turning inertia (the stored energy of the vehicles mass and velocity) into electrical energy whenever the car is slowed down by the driver lifting off the accelerator or braking. Confusing, I know.

    23. My guess is that Ferrari fears what F1 is becoming…. Entertainment.

      1. ggrr mark-up…

        My guess is that Ferrari what F1 is becoming… less Motorsport, more Entertainment.

        1. double ggrr…

          My guess is that Ferrari fears what F1 is becoming… less Motorsport, more Entertainment.

    24. Superb article.

    25. For more campaign that the press of the UK do against Ferrari, in the rest of the world Formula 1 without Ferrari does not exist. And the rest of the world is a much more important market than the UK market.
      And that cowboys who now own the business know it.

    26. In my opinion, Marchionne’s main interest is to capitalize the great efforts Ferrari did over last years, in this F1 turbo-hybrid era. We know that the present engine technology has not (for now) an effective return in terms of industrial production, mainly because the complexity of some components (one for all: the mgu-H) and the difficulty in transferring this technology in street cars in a sustainable way, even in a limited series hypercar production. Thus, the only possibility for Ferrari to have some kind of commercial and prestige return is to win with the actual regulations in a context in which F1 expresses the automotive state of art; but also victory can loose appeal if, meanwhile, increasing attention is given to the, possibly strongly different, new engines we will have in 2021, with standard components or, even worse, the loss of mgu-H. It makes no sense at all in a strong change of the (engine) regulations after only few years from this hybrid revolution if this technology is going to be strongly restricted, by returning to more conventional (even if hybrid) engines.

      1. +1. The money has been spent, the technology works, let evolution work.

    27. Considering the many brands who have beaten Ferrari over the decades- including a drinks manufacturer- surely losing to Porsche would look like a step up!

    28. i think f1 is not separate from ferrari, and if ferrari leave f1, it becomes disadventage to liberty media as f1 owner. So, liberty media must be think back againt.

    29. So the real reason Liberty is worried about costs is because they want pay the teams less money. Oh, great.
      And about Aston Martin, if you don’t want to spend money to find a few tenths a lap, you don’t belong in F1.

    30. First of all, of course the Strategy Group has no authority to vote on the new rules. It exists as a provision of the the current Concorde Agreement which expires before the new rules will take effect.

      “The key is the word “presented” – not “voted” – for there exist doubts as to whether the Strategy Group, whose mandate expires on 31 January 2020, is empowered to votes on issues that kick in after that date.”

      I don’t believe Ferrari will ever leave F1 because it would be suicidal for a business whose main product is image. No one will allow Marchionne to destroy Ferrari simply to feed his ego.

    31. First of all there is no current Concorde Agreement – only a series of bilateral agreements between FOM and the teams individually. Each agreement is different and kept confidential between the parties.

      Second, the governance structure for all regulation changes is set out in a separate document called Concorde Implementation Agreement, entered into between FOM and the FIA. Again the terms have been kept confidential, so no one knows exactly what the governance provisions are.

      It would take a court case to find out.

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