Mercedes team principal Toto Wolff does not believe teams will be tempted to exceed F1’s budget cap to gain an advantage due to the “reputational damage” caused by being in breach.
Mercedes beat Red Bull to the constructors’ championship last season but lost the drivers’ title to Max Verstappen. Red Bull have secured both titles for 2022, having clinched the constructors’ championship last weekend in the United States Grand Prix.
Given the extent of Red Bull’s penalties plus the negative attention the case has attracted, Wolff does not believe teams will be tempted to deliberately overspend to gain a benefit.
“I think what you see is that beyond the sporting penalty and the financial fine it’s also reputational damage,” Wolff told Sky. “In a world of transparency, and good governance, that’s just not on anymore.
“Compliance-wise, whatever team you are, you’re responsible for representing your brand, your employees, your partners and that’s why for us it wouldn’t be a business case.”
Wolff said he feels the FIA’s financial oversight team, led by head of financial regulations Federico Lodi, had done a good job to thoroughly audit all ten teams for compliance with the $145m budget cap enforced last year.
“I think what is most important for me is that there is a robust governance,” Wolff said. “They didn’t budge an eyelid – they just followed the process, how it went.
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“Federico and his team, Shaila-Ann [Rao] and Nikolas [Tombazis] I think were absolutely good in assessing. I know how rigorous they were with us all throughout the year. That was a difficult process. When I’m seeing 13 positions that were wrong – with us, it wasn’t the case. It’s just overall good to see that there is a penalty, whether we deem it too low or too high.”
Wolff does not share Christian Horner’s view that Red Bull’s overspend had ‘zero impact’ on their car’s performance in 2021 or 2022.
“It’s so much more precise than a normal bookkeeping, because you need to also track time of people,” said Wolff. “When somebody works 80% in Formula 1, you really need to check in and check out like a lawyer.
“But most important is it’s a relative game. It’s a sport of marginal gains also. And whether it is $200,000 or $2m, at the end everything costs performance. We all had to cover sick pay and gardening leave and the canteen. So nine teams were okay, one team was in breach.”
The introduction of financial regulations to limit team budgets is should improve the quality of racing and competition in Formula 1 over time, Wolff believes.
“We cannot let costs spiral out of control,” he said. “In US American sports – in the NBA or in football – they introduced the salary cap and the teams are healthy and the sport is healthy overall.
“I think we have started with the cost cap and it’s tremendously important also to create a more equal balance between teams. We’re all operating at $140 million dollars now. That means normally, over time, the smaller teams can catch up. There is also the advantage of more wind tunnel time and fundamentally all what we want is really close racing between many more competitors.”
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19 comments on “Penalty and “reputational damage” will deter others from breaching cap – Wolff”
28th October 2022, 21:54
Tbh, I think this is more likely a cover, so that when they “accidentally” breach the cap they can point to this as proof it was unintentional and accept the “penalty” handed to them.
28th October 2022, 23:00
@drmouse Interesting. So is that what you would do if you were in charge of a team?
28th October 2022, 23:19
Don’t know what I’d do. I’m not a very competitive person, and am much more likely to follow the rules than most. I even stick to the speed limit…
The teams and those who run them, however, are ultra competitive. If I were one of them, I’d see that you can exceed the cap, potentially gaining an advantage, and get no penalty for two years. The amount of advantage you can gain in two years is more than the penalty, so how is it a deterrent?
Look at Perez last year: he went off track and gained an advantage, and the team told him not to give the place back because he’d gain more than the 5s penalty he was likely to receive. These are the kind of people involved. They’ll weigh up the potential advantages and penalties and do that which will benefit them the most. Which option is within the rules or which is most beneficial for the sport don’t get much of a look in, let alone which is morally right.
If we want them to follow the rules, the penalty must outweigh the advantages. This “penalty” for Red Bull doesn’t even come close, IMHO, so I doubt it will be much of a deterrent.
28th October 2022, 21:59
If there was such thing as ‘reputational damage’ in F1, it would have very few fans. If the huge influx of fans owing to the Netflix series shows, a lot of people seem to love a douchebag in this sport, as long as they win. After all, it’s the ‘show’ that’s important, isn’t it?
28th October 2022, 22:43
Not every team has a Horner and Marko, so whoever you were referring to as “they” are automatically short of deceit and deception and misdirection.
Beare in mind, they say to catch a thief, set a thief, and when it came to catching on to what Ferrari were doing with their engine and fuel flow it was RBR in the lead on ideas that panned out as near enough on target to screw Ferrari for a few years.
28th October 2022, 22:57
Given the rhetoric from Christian Horner over the past few weeks, I’m not sure if they care about what the rest of the paddock thinks, as long as they win, so reputational damage might not be a strong as Toto is saying here. But I think he makes excellent sense. Most convincing for me was this bit:
Partners, sponsors, employees etc., would not want to be associated with perceived cheating. Or actual cheating. So no sane team would try to cheat. Says something about RB doesn’t it?
28th October 2022, 23:23
If RBR start to lose sponsorship for this, I may concede the point.
Tbh, though, I think the reputational benefits of better performance, and especially of winning championships, vastly outweighs any damage done by accusations of rule breaking, especially when it’s viewed as accidental.
28th October 2022, 23:47
@drmouse They have billions, and at least some of the ‘fans’ do not care at all. I hope at least some of their sponsors pull out though, that would be better than the current situation.
28th October 2022, 23:45
Red Bull built their entire brand about that disruptive image. They cannot live without controversy. RBR embrace the same culture. They were caught before cheating and were disqualified from the 2014 Abu Dhabi GP qualifying with regard to their front wings failing load tests. Daniel Ricciardo also got disqualified from the 2014 Australian Grand Prix for exceeding the maximum fuel-flow rate of 100kg/h.
They have been running countless devices and tricks that were outside of the regulations (flexi wings, engine mapping, trick suspension, …) only to be bailed out by the FIA issuing a technical directive “clarifying” the rules. The reputational damage is relevant for manufacturers like Mercedes or Ferrari who are trading on the NYSE. RBR will be willingly taking it every single day of the year if it will ensure they are running away with both championships.
Anyone thinking RBR didn’t gain an advantage and the breaches were just accounting mistakes made by their part time inexperienced accountants, I have a bridge to sell him.
28th October 2022, 23:56
@tifoso1989 You make excellent points, now I think understand more – thank you.
For me, blatantly cheating just leaves a bad taste in my mouth. Just like Red Bull, actually.
If I was Max I would be furious at the team for marring the championships in this way. Max will for many now have a cloud over his championships, and I don’t think that is fair to him.
I also have a bridge to sell, maybe we could put a package deal together?
29th October 2022, 9:12
He doesn’t seem to care at all whether there’s a “cloud over his championships”. He (and many of his fans) will just keep calling anyone who points out the irregularities “sore losers”, stick the fingers in their ears and walk off singing “La la la, I’m not listening!”.
29th October 2022, 10:56
I don’t think Max cares either. To his credit he has been the class of the field in the last 2 years but he and his dad they care only about results and winning championships.
As for selling bridges which become a very competitive business with rise of populism in this social media era and those who believe in it. I’m in with regard to forming a joint venture to sell bridges !
28th October 2022, 23:30
Stupid me. Here I was under the impression that the idea was to go as fast as you can and win the race.
I guess that all has changed.
28th October 2022, 23:44
1) Quote from Alain Prost “I always say that my ideal is to get pole with the minimum effort, and to win the race at the slowest speed possible” – so no, not “go as fast as you can”, much more likely to break the car or crash out. Old cliche “To finish first, first you must finish.”
2) You also must obey the rules. If you break the rules in any way, you do not win. Currently this bit is apparently considered obsolete.
29th October 2022, 9:53
You’d have to be a bit of a clown to think any current team would intentionally overspend on purpose. They are under such scrutiny that any advantage just wouldn’t be worth it, as we’ve just seen.
RedBull clearly made a mistake, time to accept it and go motor racing.
29th October 2022, 9:58
That’s. .. .. nuanced.. From Toto no less. Welcome, but odd.
29th October 2022, 11:27
Well, he contributed significantly to the reputational damage
29th October 2022, 15:28
Toto Should have worked in drama movies or as advocatez.
I used to clearly disliked Horner and Marko and i used to find Toto cool and mesured.
Since last year, Toto has been to make me see Marko like a cool guy …
I dont do what happened to him, but i find him quitte obsessive and agressive
If he is concerned by rules and breachs of rules, that is fine with me.
As Team Director, it’s normal.
But there’re lot of communication about being victim ans despising other teams, even when they bring themselves front wings that clearly disrespect spirits of rules (« oh that ? Ah errr that’z just structure stuff 😇😁 » « – yeah yeah … »)
That’s just hypocrosy and communication marketing
Ah, by the way, Toto.
You alone are making reputationnal damage to your own team.
Get a rest and learn to step back some.
You arn’t more credible than Horner.
That’s just lobbying…
« Please no safety car »
Reputationnal damage ?
Start to work on your own, ok ?
29th October 2022, 18:23
Your reputation cannot be damaged, Herr Wolff -you don’t have any
Comments are closed.