Sebastian Vettel, Ferrari, Circuit de Catalunya, 2020

Formula 1 will cut 2021 budget cap to $145 million – Brawn

2021 F1 season

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Formula 1 has agreed to reduce the budget cap by $30 million from its original level of $175 million, motorsport director Ross Brawn has revealed.

The cap, which will come into force next year, excludes several major costs such as drivers’ salaries. The cut has been agreed to help teams struggling as a result of the disruption to the start of the season, which has seen the first 10 races postponed or cancelled.

F1, the FIA and team principals held a teleconference earlier today at which changes to the sport’s financial structure were discussed.

“We started at 175, that was a long battle to get it there, and with the current crisis, we’re now going to start at 145,” Brawn told Sky, adding the cap may fall further over subsequent years. “The discussion [now] really is how much further down we can drive the next few years.”

Ferrari had warned it would consider racing in other series if F1’s cap was reduced to less than $145 million. Other teams, such as McLaren, had argued for the cap to be reduced to as little as $100 million.

Brawn promised F1’s smaller teams will also benefit from a “much more equitable price fund in the new agreement.”

“Midfield teams in particular are going to be much better off in terms of their portion of the prize money,” he said. “So it’s being balanced in every direction.

“We reduce the amount of money that can be spent in Formula 1 and we’re improving the distribution of the prize funds more evenly amongst the teams. So a good midfield team should be able to score podiums, maybe even a win, and it should make a small profit. And if we can achieve that then we’ve got a very sustainable future.

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Keith Collantine
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  • 43 comments on “Formula 1 will cut 2021 budget cap to $145 million – Brawn”

    1. This is a good development, but I’ll believe it when I see it.

    2. Maybe finally the message is getting across. The biggest wake-up call to us all has already set the world on a massive and fundamental re-evaluation of what is and isn’t important.

      Coronavirus is the first pandemic of the 21st century. It won’t be the last.

      Sport is just entertainment and many people are finding that amazingly life doesn’t stop if they can’t watch their favourite sport. Esports shows how entertaining sports can be in the digital world with no fear of infection.

      1. @cnitallb4 Don’t forget the SARS back in 2003.

        1. Yes, but as that only killed people who weren’t living in the western world it probably doesn’t count. (Ironic)

          1. I’m not sure why you’ve marked that as ironic, if it hasn’t affected a large part of the world it isn’t a pandemic.

          2. @cnitallb4 if you are referring to the 2002-2004 SARS outbreak, the reason for that is because there were only around 8,500 registered cases and around 800 fatalities.

            Whilst that particular outbreak did have a fairly damaging impact, the actual scale of that outbreak was comparatively small compared to what we are seeing now. Only a total of 29 nations recorded cases, and out of those only 8 nations registered more than 10 cases and just 5 registered more than 10 fatalities – so it was limited in terms of geographical reach and in terms of overall scale.

      2. It isn’t the first….
        Every year common flu, sars, mers, ebola, q fever, mexican fever, swine flu, avian flu, zika.

        But you can also put it into persepective, nuance it, because in comparison to the millennia the world was ravaged by plague, measles, and small pox, etc.
        The pandemics of today are child’s play in comparison.
        And we have never been more prepared to tackle pandemics than in the past.
        The biggest problem in controlling disease is human error.
        Corona was allowed to spread because Chinese officials covered up the disease for over a month, if it was tackled right away 99% of victims would have not happened.

        Or human errors like conspiracy theorists that spread blatant lies about vaccines and its side effects, scaring the world back into epidemics of nearly eradicated diseases.

        Yes the pandemic is terrible and it shows where the weaknesses in the system lie, but this isn’t an end of the world scenario. All in all it is a good wake up call to spend more money on healthcare.

        1. I think swine flu is the only one of those classed as a pandemic.

          1. The WHO did point out, early on in this …”pandemic”, that there are, annually, 60 million deaths every year. Their intention being to try and keep things in perspective. Yes Covid is on top of that, but compared to 60,000,000 …??
            Looking forward to the results of the MLB antibody testing. Will be interesting whichever way the results go.

            1. Well at the moment during this pandemic, a lot of countries are recording more than double the usual deaths for this time of year, and that’s with severe lockdowns to limit the spread.

    3. Well it is a start. I believe we won’t see another time where teams can spend as much as they want.

      145 mil. will do more harm for the big three than help rest of the grid.

      It hardly will do any major changes how teams will perform but more on how they will operate. It would be great to see something like 2012 season again but time will tell

      1. @qeki 2012 is by far my least favorite season of the 45 years i’ve been a fan.

        Results felt far too random & at times utterly artificial & the competitive order always felt artificial rather than a true sign of who had designed the best car or which driver was doing the best job.

        You had Maldonado turn up to a race & dominate it with pole & a win yet do nothing else all year as he/williams had just lucked into the tyre window that weekend, They never knew how or why & so were never competitive again. The same was true with others early in that year, Nobody knew why they were good or bad from race to race.

        The whole thing felt disjointed rather than been a part of an actual championship season.

        1. As someone who’s watched so many races – surely you must remember how many race results were turned upside by a lack of reliability, or how unpredictable races are when crazy weather intervenes.
          Battling the variables is all part of the game.

          1. of course but things like unreliability & even changeable weather are natural variables. You can’t control the weather & when you were pushing the boundaries of technology/performance you are going to see failures.

            2012 however felt artificial & that was my biggest issue with it. The results didn’t feel like they were happening via natural occurrences or because some teams/drivers were doing a better job than others. They felt like they were been forced because the tyres were been designed to have artificially tiny operating windows with certain chemicals added to the compound to artificially create more degredation & thermal problems than should have otherwise been the case.

            And the longer the randomness went on the more random, artificial & gimmicky it started to feel.
            .
            .
            And I think the lasting damage of 2012 is that it raised expectations well beyond reality because now ‘some’ fans seem to think that is what F1 used to be when in reality it never was & under normal circumstances likely never will be. I mean look how many ‘F1 was more competitive in the past, look at 2012’ comments you see now. They believe that in 2012 you had 4-5 teams that had built cars of very similar performance all capable of podiums/wins on pace when in fact they hadn’t. Red Bull/McLaren had the dominant cars on performance & everyone else was a second or more back on pace, The randomness was purely down to the artificial gimmick tyres that were creating artificial results. As soon as the tyres were changed mid-season the truth came out.

            2012 is the closest i’ve ever come to turning my back on F1 because I just didn’t enjoy the first half of that year. When things turned around mid-year & it started to resemble a sport again it drew me back a bit. Had early 2012 carried on all year i’d have simply walked away & i’m not sure i’d have come back because once you lose me you lose me.

            1. @roger-ayles I’m not sure what was so random about 2012. The true performance of the cars was genuinely close for most of the first half of the season, and it wasn’t completely random, and then it was down to the driver/team combination. The Williams was genuinely a great car that excelled in medium-low speed, which is why Maldonado was quick in Australia, Catalunya, Valencia, Abu Dhabi etc. It was down to the inconsistency of the drivers that Spain appeared more like a freak result. In the hands of a more competent driver, that Williams would have achieved several podiums. The Sauber was the opposite of the Williams in that it did well in high-speed tracks like Montreal and Monza. The Lotus performed better in warmer conditions, and that was true in all of 2012 and 2013, it was an inherent car trait. You make it seem like it was a complete lottery, which it wasn’t. A combination of team errors and car characteristics not too dissimilar to what we have in F1 right now with Ferrari, Red Bull and Mercedes was the cause of the results.

            2. Fine, but I would rather see another 2012 season than the Lewis/Valtteri battle for championship as 2019.

      2. ColdFly (@)
        4th May 2020, 17:19

        145 mil. will do more harm for the big three than help rest of the grid. (@qeki)

        Interestingly FOM is using the budget cap (first the $175m and now the $145m) as something good for the big teams. Something like, we help you save many millions, so you should not object when we take away part of your special prize money as you will be net better off.

        1. Once the bean counters get into action in all major (car)manufacturers in a month or so – with drastically dropping share prices, turnover and profit margins and uncertain perspective of improvement on top of the already hurtfull (for car manufacturers) perspective of ever tightening regulations limiting CO2 and other exhaust gasses, I think most in F1 will be glad that now they can at least give a clear maximum of the cost factor of F1 when they are trying to convince their board and shareholders to continue in the sport @qeki, @coldfly, I think that FOM (and the FIA) are doing exactly what is needed with introducing a cost cap and pushing it downwards.

      3. 145 mil. will do more harm for the big three than help rest of the grid.

        I guess that is one way of viewing the budget cap. The problem is currently those three teams very successfully dominate the racing series, to the point that it makes it almost impossible for a driver outside of those teams to win a race. I believe the last race won by a driver from outside those three was the Melbourne GP in 2013 (RAI, Lotus F1). So F1 isn’t a credible racing series.
        Without doubt the budget cap will cause those three to downsize and reduce their ability to extract performance from every conceivable part of a car and the rules, but I disagree with the notion the other teams won’t benefit more. A consequence of the budget cap is the other 7 teams will get far more equitable income, which means they can perform far more equitably, which is better for everyone. In fact the people that gain the most is us, because we will then be watching a far better racing series than F1 is now. Those three that repeatedly win and get the podiums are an accident of history that should never have happened. Even with the budget cap I still expect them to dominate the series for the next few years, but I also expect the other teams to progressively get better and better.

        1. I agree with everything you have said here @drycrust. I am not really sure why several people are complaining about this idea. Are people really happy with the same three teams winning every single race for the past six, almost seven years. The same single team most of the time.

          I like some others have been watching F1 for many years i.e. since the 1980s. I can completely accept that a lot of the unpredictability in the past has been caused by a lack of reliability or factors like the choice of tyre. This is partly though what used to make F1 so exciting. It should not all be about massively expensive cutting edge design innovations which serve to exclude most of the teams. What about the drivers?

          I think the lower budget cap and a fairer distribution of income can only be good news for the sport. It’s still miles off of GP1.

        2. three teams very successfully dominate the racing series, to the point that it makes it almost impossible for a driver outside of those teams to win a race.

          But is that true? Or are other teams failing to take chances that are there?

          For a start, there are four big teams in F1 at the moment – Renault are a works team, they’re just completely underperforming. Mclaren have been rubbish by their usual standards for several years. Williams have struggled with problems of their own making, as have Force India/Racing Pt. Haas looked poised to become genuine challengers and then threw it away last season.

          In all cases except Renault – who apparently just dgaf – it’s pretty obvious that more testing would have given the teams chances to work out their problems and fix them.

          Limiting testing to some extent is a good thing, but there’s no cost as great as running a team for a season you have to write off because you aren’t allowed to fix your problems.

    4. OK, here’s a thought.

      All of the massively overpaid sports stars in all disciplines, yes, I include you, Lewis Hamilton, are supposedly taking a pay cut. Why not, they aren’t doing anything to earn these astronomical sums.

      Let all the sporting regulators impose a 90% pay cut on all sports stars earning over a certain amount each year, say £5 million, just for this year and that money goes directly into funding to find a vaccine for Covid19 and future research for the pandemics to come.

      1. congratulations, you’ve just invented socialism

        1. How many governments around the world are coughing up cash for the newly unemployed?
          ‘Socialism’ is saving much of the world from complete economic collapse.

      2. @cnitallb4 we already have an extremely large portfolio of potential vaccines – over 70 at the last count – which are either being readied for testing or are already starting to undergo medical trials.

        Right now, the acquisition of funds to undertake research into a potential vaccine doesn’t seem to have been a bottleneck in the process. Most of the problems are problems where money alone might not actually make a huge difference – it’s more about the acquisition of data to prove the effectiveness of the potential vaccines and investigating the potential risks of adverse reactions.

        That is something which will require longer term studies to confirm the effectiveness of that medical treatment over an extended period of time – money isn’t going to radically shorten or alter that part of the process.

    5. So basically we are heading towards GP1.

      Guess i’ll just stick to the F1TV archive to be able to watch F1.

      1. ColdFly (@)
        4th May 2020, 17:28

        So basically we are heading towards GP1.

        Why would the name be changed to GP1, @roger-ayles?
        If you infer this makes F1 a spec series, then I’m not sure how you come to that conclusion. If anything, a budget cap is one step in making sure that it doesn’t become a spec series: instead of reigning in technical freedoms they reign in financial freedoms. FIA could let go of many of the technical restrictions (materials allowed to used) if a good budget cap is in place.

        1. I’d much prefer an F1 with a fixed budget and open technical regs than the inverse which we have had for so long.

          1. Agreed. innovation is the life blood of F1. Without that it is just a posh F2. It is innovation which sets F1 apart from all other series, the high tech nature, the surprise developments, the race to get there first.

            That can all be done on a lower budget as it starts and ends using brains ( and some computers and wind tunnels).

        2. @coldfly I would guess that the reason why he is complaining is because the talks about the introduction of the budget cap have, so far, the tightening of the technical regulations and increased standardisation of parts are the mechanisms that would be used to implement that financial cap.

          Whilst some have advocated for “a fixed budget and open technical regulations”, that option is not being offered and there are no signs that they have any intention to offer that in the near future: instead, the attitude seems to be that the budget restrictions can only exist through the tightening of the regulations.

        3. @coldfly But they have also been talking about introducing more standard bits under the guise of ‘fans can’t see them & don’t care anyway’. They have been talking about locking down innovations that they see as ‘grey areas’ & the 2021/22 bodywork regulations are so restrictive you have a real danger of cars simply looking identical. Then you have the other gimmicks they are seriously discussing from reverse grids to sprint races & something that is a balance of performance in all but name.

          A budget cap with more open regulations & technical freedoms would indeed be interesting but that doesn’t seem to be the direction they are heading in.

          It’s just not F1 anymore because practically everything F1 once was is slowly been stripped away & that is only getting worse unfortunately.

          1. @roger-ayles Maybe you prefer watching F1 races where some teams are 4 seconds ahead of everyone else like WEC, but I can assure you not all of us purely want to see Formula Engineering. In that case, get rid of the driver’s championship completely and make it a constructor’s one, as the drivers will barely count for anything. Even as an engineer, I watch F1 for the entertainment in addition to the technical side, not purely to see an engineering exhibition. I want to see close racing where I can’t tell you on a Thursday ahead of the weekend the exact way the grid will line-up.

            1. @mashiat Then don’t watch F1. F1 is what F1 has always been & if you don’t like what F1 is then don’t watch it.

              There are plenty of spec categories where you will see close, competitive racing where half the field can win. But that isn’t what F1 has really ever been & I don’t mean to sound harsh with this but if you can’t accept or get behind what F1 has always been then go watch another category that offers something more like what you want.

              I don’t watch nascar for instance & then complain about how it needs to change to my wants. I see what it is & know that isn’t for me so just don’t watch it. Those who don’t like what F1 has been/is should maybe just do the same & go find something they do actually like.

            2. @roger-ayles I could say the same to you. If you find so much to complain about in F1, maybe don’t watch it. Simple. You can’t hold on to whatever F1 “was”, it evolves like everything else. You can’t continue living in the past. I’m not the one who is complaining about how F1 is now, so perhaps it’s time for you to watch WEC where you can see all technical innovations and very little competition. F1 has always been about entertainment. Always. I’m not suggesting a spec-series, I’m suggesting closer racing, which provides entertainment, which has always been in the DNA of F1. How many people who go to F1 races or watch on television are watching it purely to see the engineering side? If that was the case, FP1 would get more viewers than the race.

          2. @roger-ayles you’re spot on.
            They can’t have it both ways. If they are going to enforce a budget cap, and I think they should, then open up the technical regulations and let the teams again find unique differences that make big differences on the track.

        4. @coldfly

          instead of reigning in technical freedoms they reign in financial freedoms. FIA could let go of many of the technical restrictions (materials allowed to used) if a good budget cap is in place.

          That’s the key. if anything a smaller budget cap will drive innovation faster. That’s what is worrying RB they and the other cashed up teams will lose their big $ advantage.

          1. ColdFly (@)
            5th May 2020, 12:33

            Indeed, @johnrkh, it’s easier to win an out-spending racing than an out-smarting race.

            And the worst part is that the out-spending race is a vicious circle with the top teams getting special bonuses and an unfair big share of the remaining pie.

          2. @johnrkh right now, that isn’t an option that is being explored – the budget cap is to be imposed through making the regulations even stricter (now being the strictest regulations ever imposed on the sport) and by the imposition of an increased number of standardised parts.

            The approach that is being taken isn’t an “either/or” case – the philosophy towards the budget cap has been to explicitly link the financial restraints to a tightening of technical regulations, with the former only being achieved through the latter.

    6. Shouldn’t every article about the budget cap begin, and perhaps end, with a reminder that it is completely unenforceable? Bickering over the amount is pure posturing.

    7. I can see a lot of people losing their jobs soon, the budget cap is going to reduce the top teams to a third of what they spend (or half with the exemptions) and those staff are going to have nowhere to go because the smaller teams aren’t going to increase spending.

      Even if it was enforceable I don’t see a budget cap as a solution unfortunately. If they have to do something I would prefer unlimited spending but 20% of all teams budgets is redistributed equally between all teams.

    8. Ferrari had warned it would consider racing in other series if F1’s cap was reduced to less than $145 million.

      I really really like how this story evolved. I also like how Brown supposedly erupted because of Ferrari as Horner ends up flopping Italy wwi style, now the budget cap is not great because Ferrari, engine, fia…

    9. Stroll is getting in at just the right time. A savvy investment if the drivers can deliver points for Aston Martin in F1.

    10. Two old sayings come to mind here:

      The road to hell is paved with good intentions.

      Rule nothing out while hoping for the best while preparing for the worst.

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