‘We’ve had 10 approaches about starting new teams’: Exclusive interview with Cyril Abiteboul

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At first glance the decision by McLaren to defect to Mercedes power units from 2021 seems to be a slap in the face for Renault F1 Team.

Renault had previously endured non-stop jibes from Red Bull Racing over its engine performance in the V6 hybrid turbo era, so much so that both Red Bull outfits switched to Honda, at that stage even more derided, yet now a multiple race winner

Factor in that Renault is not on the receiving end of any of Formula 1’s bonuses (even tail-ender Williams receives a ‘modest’ $10 million annual sweetener) after re-acquiring its former Enstone-based team, and one is tempted to ask team principal and CEO Cyril Abiteboul how many more blows the French-controlled team can endure.

Yet, when we sit down outside the team’s hospitality late on Sochi Sunday morning – the day after news of McLaren’s decision broke – the Frenchman’s mood is far sunnier than the overcast skies hanging over the Black Sea resort.

Is he sorry to lose the only power unit customer his team has got when rivals Ferrari and Mercedes have two each, and the latter will reach three in 2021? I expect his answer to be a qualified ‘yes’ but it turns out to be exactly the opposite. How so?

“Because if the customer is not bringing anything to the party,” he says deliberately, “why bother?”

Carlos Sainz Jnr, McLaren, Red Bull Ring, 2019
McLaren will split from Renault after next season
“What I’m sorry [about],” he continues by way of explanation, “is that we were not able to bring the relationship to a different level. We tried, because for me the single biggest threat for both McLaren and Renault preventing us really to reach the top teams is not [the concept] of a customer team, but [of] a junior team and a B-team arrangement.

He goes on to stress that he “did not want McLaren to become our junior team”, and laments the co-operative opportunities that both will in future miss out on, particularly with the looming prescriptions of the 2021 regulations and budget cap.

He adds that some form of co-operation was discussed when the engine deal was first cut (in 2017), but that was, of course, under a McLaren team then managed by Eric Boullier, who had previously directed the Enstone team in its Lotus guise. However, new McLaren F1 boss Andreas Seidl clearly has different ideas, and is not afraid to take tough decisions.

I point out that there is no other potential customer on the current grid. “No,” Cyril says flatly in agreement, then suggest that under such circumstances Renault needs to hope that at least one of the various new teams currently being mooted comes to fruition, then hook up accordingly.

“You know, we’ve had 10 approaches,” he discloses, “10 people are onto us, talking about forming new teams. But it’s not in our hands to decide. I do believe that, not just for us, Formula 1 will be healthier and stronger with more teams.”

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He pauses, then adds a qualifier: “We don’t need just more teams, [it’s] not just the question of quantity, it’s also the quality of the project, the sustainability of the project.

Charles Pic, Cyril Abiteboul, Caterham, 2013
Abiteboul previously ran tail-enders Caterham
Abiteboul is well-placed to comment on the difficulties faced by F1’s smaller teams. He is the former (hired) team boss of now-defunct Caterham, having been recruited from Renault after the team briefly withdrew from F1.

“I’m obviously well-positioned to talk about these things. If you set up in Formula 1 you need to make sure the project is sustainable, not just for a one-year or a two-year plan…”

What, though, if Renault proves unable to attract a satellite or partner team: Would it still be economically viable for Renault to remain in F1 given that it would be unable to spread some of its cost bases, particularly on the power unit side?

He provides a surprising answer, which then proves logical as the full facts are revealed: “[Engine supply] is completely neutral, because under FIA regulations you have to sell at the cost of the parts; you don’t depreciate the structure, or you don’t depreciate your R&D costs.

“We buy all the [engine] parts outside, we have absolutely no manufacturing capacity. We subcontract, we receive the parts, we control the parts, we build the engine, but we don’t produce the parts. Unlike [the Mercedes operation in] Brixworth.”

He draws a comparison between the Renault and Mercedes engine manufacturing models, saying, “If you go into Brixworth, you’ll see plenty of machines, turning machines, milling machines and so on, so they produce their parts, lots of their parts, whereas we have to buy everything from outside.”

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Unsaid is that Mercedes needs a broad customer base to feed its engine operation, whereas Renault’s engine operation in Viry-Châtillon, a southern Parisian suburb, carries a slimmer overhead on account of its out-sourcing strategy. Ironically, the operation could be equated to the Haas-type model applied to engine manufacturing.

Romain Grosjean, Haas, Circuit de Catalunya, 2019
The Haas-Ferrari model appeals to Abiteboul
Abiteboul believes that from 2021 engine costs are likely to increase due to real world inflation and development costs, yet, “The FIA not willing to move from their €12 million mark on the baseline engine, [so] we would actually end up subsidising McLaren. Explain to me why I’m going to subsidise my most direct competitor, my most direct threat?”

What, though, about the advantages of increased grid presence or the political advantages of shared engine supply?

“Actually, [there could be a perception] that Renault is a bunch of losers because they’re beaten by their customer. So again, from a communication and marketing perspective there is really little in it for us,” he says in response to the first part of the question, “conceding, though, that there could be some advantages from a “footprint perspective”.

Then a pause before another wry smile. “I have never seen Red Bull voting for something because that was something important for Renault, and never would I expect that from Andreas [Seidl],” he says before going on to suggest that Renault has possibly been slightly naïve in not leveraging engine supply to its own advantage.

Cyril has previously referenced the Haas concept of sourcing all permissible technologies and expertise from Ferrari and outsourcing/sub-contracting the balance as a ‘fantastic model’. I question whether such an arrangement is his ideal for aligning with a customer team.

“In my opinion it’s a team that needs to be able to bring something, where we can create synergies,” he explains. “I think it needs to be an established team with some experience. We have little time, so it’s better to have a team that is already in action, that already exists, that has some footprint, knows the sport and, again, [is] a sustainable project.”

That’s a long shot given that all existing teams are spoken for. But he is clearly thinking longer-term, in turn implying Renault’s continued presence in F1 despite some veritable headwinds: “If possible, [there should also be] a marketing [element] because there is nothing better than a marketing project in order to have a sustainable project in Formula 1.

“We need time, we need to unleash the potential of such an arrangement. It’s not going to happen in year one or year two; you know, it’s a long-standing arrangement.

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“So, sustainability of the project: I think the sort of Alfa/Ferrari is a good example because they are sharing a marketing project. There is a mix of marketing, there is a mix of technologies, there is a driver element into this, there is an engine element into this. So, all of that is a very good example.”

Guanyu Zhuo, Uni-Virtuosi, Sochi, Formula 2, 2019
Zhou has impressed in his first season of F2
Would, though, a stopgap deal with a new satellite team tick some of the boxes in the interim, I wonder?

“I don’t know,” he says. “It’s very difficult to tell you out of the blue, but I don’t know if there is a company in China, for instance, you know China is an important market for Renault. We have a Chinese driver that is doing very well in his first year in F2.”

This is Guanyu Zhou, formerly a member of the Ferrari Driver Academy, who has blossomed since he joined Renault’s programme this year. He lies seventh in the F2 standings and first among the rookie contingent.

“That can be an interesting starting point,” Abiteboul continues. “But that’s pure theory at this point in time.”

I point out that Panthera, the potential new F1 team revealed by RaceFans in August, allegedly has some Asian funding, but Abiteboul will not be drawn on the topic save for admitting that there has been some contact.

“We’ve met different groups of investors behind this project, and I think it’s moving; it’s clearly coming from the eastern part of the globe. But I think it’s up to them to disclose anything more in relation to their funding.”

The son of two engineers and a graduate engineer in his own right who interned with Renault, Abiteboul has long expressed concerns about the ecological impact of F1 and road car relevance, and has recently become more vociferous about the need for F1 to adapt to a rapidly changing environment, calling for, for example, synthetic fuels and alternate technologies to be introduced sooner rather than later.

“I’m urging everyone to fast-track the consideration for a new power unit [currently slated for 2025], what it should be, what it should look like, what it should cost, and start [to] stop spending crazy amounts of money,” he says.

“The reality is that we’re spending crazy amounts, all four engine manufacturers, and [we need to] start spending on what will be relevant for the future.”

Chase Carey, Cyril Abiteboul, Circuit Gilles Villeneuve, 2019
Abiteboul wants F1 to consider new power sources
He believes “electrification will not go away” and foresees a slowdown on investments on traditional internal combustion engines by motor manufacturers, which will in turn change the face of F1.

“Maybe [F1 should] also consider new sources of energy, like fuel cell or things like that, which probably will be the future for Formula 1. I don’t want to give a particular date, but look at how fast the world has changed in the last two to three years…”

Renault re-acquired its Enstone base in 2016, having disinvested in 2009 after being hit by the double whammy of ‘Crashgate’ and the global economic crisis. Subsequently the facility has been ramped up, with headcount growing from the sub-400 level during the final Lotus days to the current 700-plus.

According to Companies House filings the team’s overall budget – excluding the French engine facility – is in the region of $180m. But that includes components which will be excluded under the budget cap. How does Abiteboul foresee the looming budget cap affecting the operation?

“We are way below the budget cap. The situation right now, when we set up at Enstone we were assuming a budget cap, first and foremost. And that’s happening, that’s a good thing.

“But we were assuming a budget cap in the region of $150 million. So now we have a budget cap, good, but it’s higher than planned, $175m, and with more exclusions [these include driver costs, executive salaries and marketing/hospitality] than initially planned. So that’s mixed news.

“Put drivers in, marketing, depreciation, building facilities, put all of that in that [will be] excluded. So it’s quite a lot of exclusions, so actually when people talk about 175 [$m], if you add up everything you can easily go to 250.

Cyril Abiteboul fans, Circuit de Catalunya, 2019
Will his fans have two teams to cheer in 2021?
“I think it’s good to have a budget cap, to start somewhere. I understand that we needed the first step and some form of compromise. Now that we know what to plan for, we need to define if we have the necessity to go up, so basically to spend more, to work with more people than we have currently.”

Although he estimates the exclusions in the case of Renault – which runs less lavish marketing and hospitality set-ups than, say, Mercedes or Red Bull, to amount to $40m – Cyril makes clear that the increased budget cap level is cause for concern at Renault headquarters in Paris.

“I see some things that we need to discuss with our parent company and also based on the sponsorship acquisitions that we are capable of doing in the next two years,” he says.

Nonetheless he has said much which will allay any fears Renault could be on the brink of exiting F1 in the wake of losing its only engine customer, and also due to the effects of an increased budget cap, let alone its political isolation

True, in an ideal F1 world Renault would have a B-team or even a satellite operation with which to share engine supply, technologies, development costs and political ideals, but, as Abiteboul admits, such prospects lie outside of Renault’s sphere of control.

Thus, for now Renault F1 Team has no choice but to hang in and hope that an incoming team materialises sooner rather than later. The question, though, is: What if that turns out to not be the case?

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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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26 comments on “‘We’ve had 10 approaches about starting new teams’: Exclusive interview with Cyril Abiteboul”

  1. ZAC BROWN JUST RESIGNED!!

    1. Please, you make it sound so melodramatic. He’s only resigning from his position at motorsport website. That’s all

  2. Maybe Cyril Abiteboul is a good engineer, good marketing man, good guy overall. But as Formula 1 team principal…he really does not have a lot to brag about.

    1. Agree with that. He is running this team to the ground. The last time Renault was any god was frankly when Kubica was driving for them. He is not only bad at running the team but more importantly, managing the relationships with Renault’s customers and suppliers.

      1. I also agree and shocked Renault has kept him. Obviously when looking at there track record and customer support performance for the last several years with him on the steering wheel is dismal for a company it’s size and history.

        I also have disagree with Aleš Norský statement saying Cyril Abiteboul is a good marketing man. His constant talking to the press with statement after statement boosting Renaults technology and performance improvements to only have them not materialize is bad marketing and has put a lot of people off Renault F1. He would be better off to just let the results on the track do the talking.

    2. Disagree. You need to consider the state of the team when Renault took over. It takes a long time to build new infrastructure and to hire lots of good people, because they all have contracts that require them to take gardening leave before they can start a new job. Despite that, Renault has been improving step by step. This is the first year where it’s a bit less, but that’s mostly because McLaren made such a jump forward, not because Renault is losing ground to the front of the pack. So given the steady progress, despite an inferior budget, it seems to me that Abiteboul is doing an excellent job.

  3. “We buy all the [engine] parts outside, we have absolutely no manufacturing capacity. We subcontract, we receive the parts, we control the parts, we build the engine, but we don’t produce the parts. Unlike [the Mercedes operation in] Brixworth.”

    Now, this makes so much more sense as to why their PU never really improved. Also, if this was possible (buying parts and building your own PU) why dont other teams just do the same?

    1. @lums

      They’d still have to design and develop an engine…

    2. @lums

      Also, if this was possible (buying parts and building your own PU) why don’t other teams just do the same?

      Maybe It’s a Renault design (mostly) and not many smaller teams would have the ability/money to design an engine of such complexity. So easier to just buy one off the shelf with factory support.

    3. It isn’t just a case of ordering some parts and screwing them together, someone has to specify the quality of materials, design etc etc and then test to see if the calculations for the spec parts was correct …. if not then rethink, rethink, rethink and redesign ad infinitum as competitors improve their products.

    4. subcontract

      is the word here. Parts are just manufactured outside but it’s all 100% unique Renault design.

  4. So the big story from the headline is that Abiteboul counts in binary?

    1. The rumor is there are 10 people are renault who count in binary.

      1. That sounds like twice as many. Or am I a bit wrong.?

  5. Merc, Renault and Honda will stay in F1 as long as they can justify the costs v advertising and technological benefits to their businesses. They don’t need F1 but it’s certainly helpful.
    Ferrari, McLaren and Williams are different they are more ‘pure’ racing teams, they sell products to support their racing. I think it would be difficult for these teams without F1.

  6. Great article.

    I have to admit that I’m stunned about them buying in all their PU parts. Might explain why they have been so prone to reliability and parts supply issues.

  7. Antonio (@frosty-jacks-racing-team)
    9th October 2019, 15:45

    Cyril Abiteboul = Surreal A Bit Bull…

  8. “Panthera” team: Will you supply us with engines?
    Renault: We don’t know, maybe. Who are you?
    Pause.

    “Panthera” team: Will you supply us with engines?
    Renault: We don’t know, maybe. Who are you?
    Pause.

    8 more times. Then…
    Renault: we have been approached 10 times…

  9. “The FIA not willing to move from their €12 million mark on the baseline engine, [so] we would actually end up subsidising McLaren. Explain to me why I’m going to subsidise my most direct competitor, my most direct threat?”

    Fascinating. Are all power unit suppliers operating at a loss?

    1. If you count research and development, very likely.
      His comment confirmed what I had long expected.
      The general lack of (obvious) development at Renault, also fits in with the content and tone of the interview.
      Another great and insightful piece by DR.
      Thanks … again.

  10. I don’t think any of the F1 team principals are out of their depth. Claire Williams is the bosses daughter, Lawrence Stroll is a retailer, but they’re managing, and other than their two borderline qualifications, the other 8 all seem like solid choices as managers. Perhaps Binotto is not well served by his sporting director, and if I shook hands with Christian Horner I would surely stop and count my fingers afterwards. But Mac Brown was a marketing / racing guy who was smart enough to identify what McLaren needed and hired Seidl. And Ottmar oversaw a very tough transition for Team India. The others all make sense, on their faces.

    So if I was the bosses’ boss at Renault, I would think we were well served by Cyril running the team. The Renault F1 “project” is a very valuable brand element in China with millions of affluent Chinese following F1. And Renault makes and sells more than 150,000 cars a year in China. So when Cyril says he’s got a 5 year plan, and that involves management sinking more than a $500 million investment cost in F1, I think he’s credible and we’ve got real good reasons to back him until 2022. At the same time, I’m sure the milestones Cyril has set out need to be met. Renault will probably miss being 4th this year, but at least it’s a Renault engine in the McLaren. And with the driver shake-up, that gives Cyril a years grace to get everything humming–4th place for sure, plus some podium time in 2020, and more in 2021 when the rules are re-written. Renault has to get their 10,000 rpm engine to almost always last to the end of a race, and Ocon and Danny Ric have to be pushing in among those top six drivers, whilst keeping Sainz and Norris at bay. All not easy goals. But along as they leave Cyril alone whilst also holding his feet to the sire, there’s real hope for Le Regie.

    1. holding his feet to the fire, there’s real hope for Le Regie.

    2. Another stellar article by Dieter, thank you.

      I appreciate this comment. I’m in no position to judge Cyril — I’m a vintage car mechanic living in CA, what can I possibly know about what goes on in Enstone? — and I grow so tired of the off-the-cuff punter’s bashing of anything in F1 they dislike. It seems far too simple to say he doesn’t know what he’s doing and that is why Renault is struggling.

      Take Zac Brown. Prior to hiring Andreas, I’d listen to Zac’s interviews and I was SURE he was just some dumb annoying marking/biz-dev guy and, yet, he has actually managed to restructure McLaren, turn them around and make my judgment of him look foolish.

      Frankly, I’ve understood the approach Renault have, what is the point in dumping crazy money, at this stage, to improve certain elements given what was slated to be a big change for 2021? Obviously, they want to improve and there are factors at play that need improving, but as this article points out there are complexities to this F1 business many of us know nothing about and frequently these factors change without warning.

      I really am curious to see what goes on — across the board — for F1 2021 and onwards.

  11. 10 companies showed up wanting Renault F1 engines for their brand new F1 project?

    I struggle to believe that number. my BS detector is going off.

    It is like a disgruntled former supplier saying to McLaren “We can get 10 teams like you next year if we want to.”

  12. If I was Cyril and a potential new team came sniffing round, I would be very keen to see if they were open to the Haas type model in order. Renault could get naming rights on the team or the PU, potentially giving them the ability to badge the team/PU as an Alpine, or even a Nissan, Mitsubishi, Infiniti or Lada…the last one probably would only be appealing to investors from the correct location.

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