Most liked posts in thread: 2014 - F1

mrntd · Oct 24, 2014

Caterham has been turned on to the administrators. It looks like the end for the team.

Now it looks like Murussia might not make the USGP either.

Zapski · Oct 24, 2014

Huh.

Caterham given permission to miss next two races - F1 Fanatic

Bernie Ecclestone has agreed to give Caterham a dispensation to miss the next two rounds of the championship while the administrators who own the team try to find a buyer for it.

Administrators Finbarr O’Connell and Henry Shinners of Smith and Williamson have agreed terms with Colin Kolles to take charge of 1 Malaysia Racing Team, which owns Caterham’s licence to compete in the world championship, as well as Caterham Sports Limited.

This means they are now able to sell Caterham’s F1 racing operation and championship entry as a going concern if a buyer can be found. Shinners said “Purchasing the assets would give the buyer ready access to F1 racing”.

“This includes the Formula One licence, the racing cars, the designs and intellectual property for current and future seasons plus the workforce and all of the technical support provided to the racing team by CSL from the Leafield Technical Centre,” he added.

Caterham can miss next week’s round in the USA and the race which takes place on the following weekend in Brazil. Ecclestone wants the team to participate in the season finale which takes place two weeks later in Abu Dhabi.

However staff at the British-based team’s factory in Leafield have been advised they do not need to return until the team has been sold.

O’Connell said the arrangement “gives us a much better chance of being able to reach a better conclusion for the racing team and its creditors”.

“This is a difficult situation which is not of our making,” he added. “We regret any personal impact on 1MRT’s employees. As administrators for CSL, we are seeking to maximise the outcome for its creditors and other stakeholders.”

With Caterham unlike to appear at the next two rounds, the F1 field will be reduced to 20 cars, assuming Marussia return to fielding two drivers.
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Zapski · Oct 25, 2014

No Marussia either at COTA.

BBC Sport - Marussia and Caterham to miss US Grand Prix - Bernie Ecclestone

Formula 1 boss Bernie Ecclestone has said Caterham and Marussia will both miss the US Grand Prix next weekend.

Caterham are in administration and have also been granted permission to miss the Brazilian Grand Prix while Marussia are struggling financially.

Marussia driver Jules Bianchi remains in hospital having sustained serious head injuries in an accident at the Japanese Grand Prix on 5 October.

"Neither of those teams are going to go to America," Ecclestone told Reuters.

Marussia look likely to miss the Brazilian Grand Prix as well, due to the air transport for all the F1 team cars and freight being organised by Ecclestone's Formula One Management.

The races in Austin, Texas and Sao Paulo are back-to-back and the cars will be transported direct from the US to Brazil before returning to Europe.

Both Marussia and Caterham are based in Oxfordshire.
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Steve · Oct 25, 2014

If no Marussia then no Rossi, right? I assume they would have put him in the second car. So, no American driving on the US track and down to 18 cars overall.

This certainly won't improve last minute ticket sales.....

Steve · Oct 26, 2014

Zapski · Oct 27, 2014

Yikes. What a cluster f#$%^

F1 teams have written contracts to supply struggling rivals with a spare car, reveals Bernie Ecclestone | Daily Mail Online

Bernie Ecclestone has revealed that Formula One's teams have signed contracts agreeing to help competitors which get into financial trouble by supplying a car to them. It is a particularly pressing problem.

Sportsmail can reveal that the Marussia team notified London's High Court earlier this month that it intends to go into administration. It follows the collapse this week of F1's worst-performer Caterham.

Eleventh hour talks are underway to save it and Ecclestone says another team may have to step in by supplying it with a car. The controversial rule is written into the teams' contracts with Ecclestone and it forces them to field a third car if the grid slips below a threshold of 20 cars.

It was thought that the teams would run the third car themselves but in fact it would be supplied to ailing rivals to stop them from going under.

'They would supply a third car to someone else so if, for example, Sauber disappeared, a team could do a deal with Sauber. Ferrari could say, ''we will give you a car, all that goes with it, and we want you to put this sponsor on it. You have your own sponsors but we want you to include this one as well and we want you to take this driver''. The team wouldn't have to go under then would they? If Red Bull decided they would give a car to Caterham for example that could solve their problem.'

The reason for the clause is that Ecclestone's contracts with race organisers state that F1 'shall use its reasonable endeavours to ensure...that at least sixteen cars participate in the Event.'

If it slips below that F1 could breach its contracts and risk losing the Â£300 million in fees paid by race organisers. Setting the threshold at 20 cars gives Ecclestone a buffer and he may need it. Annual F1 team budgets are now around Â£140 million on average and although Red Bull has one of the biggest, smaller outfits are struggling to keep up.

On 7 October Manor Grand Prix Racing, the company which runs Marussia, filed a notice with the High Court saying that it intends to appoint an administrator. The team lies in ninth place with just two points and has made combined net losses of Â£140.6 million since joining F1 in 2010.

Ecclestone said on Saturday that he expects Marussia and Caterham will miss next weekend's United States Grand Prix. It will put the grid at 18 cars but Ecclestone added that this won't trigger the third car clause because the teams' F1 contracts allow them to miss two races each year.

'We don't have to introduce a third car at this stage because they can miss a couple of races. They lose any money they would have got for those races but they don't lose their position in the championship. I have no idea if Marussia are going to make it in the long run. It's better if they didn't have to go into administration.'

It is too late to prevent that happening to Caterham. Earlier this month bailiffs seized equipment from its factory in Oxfordshire and the team's 220 staff have been locked out of the building by the administrator since Thursday.

It languishes in 11th place, one behind Sauber which has failed to score any points this year despite having backing from sponsors owned by the world's richest man, Mexican tycoon Carlos Slim.

If a team received a rival's car it would not need to spend money on research and development, manufacturing or buying engines. These are the three biggest costs for F1 teams, far exceeding spending on staff and drivers which would continue to be covered by the outfit which receives the third car.

Marussia's latest company accounts are for 2012 and show that it spent Â£32 million on research and development which alone comes to 42% of its total Â£76.1 million costs. Manufacturing and engine expenses are estimated at a further Â£23 million. Wiping out these costs would transform bankrupt outfits into profitable ones which could attract investment and ultimately stand on their own two feet.

Some teams raced with three cars in the 1970s though this was because there was freedom to do so not because the grid had hit a threshold stipulated in contracts. Although the teams have signed up to supply third cars now, several of them, including Britain's Williams, have long opposed a similar scheme where outfits would sell customer cars to rivals.

'We don't believe customer cars and three car teams to be in the DNA of our sport,' says Williams' deputy team principal Claire Williams. I think a more important question is why are we having those conversations and that's because there is talk that teams are in financial difficulty at the moment. I think we need to be addressing the cost issues in Formula One in order to support the teams that we currently have.
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Zapski · Oct 27, 2014

And more of the cluster fallout.

FIA could change US GP qualifying format for 18-car entry | Adam Cooper's F1 Blog

The FIA has the option to change the format of qualifying to reflect the 18-car entry that it is expected in Austin next weekend, with both Caterham and Marussia failing to make the trip.

Currently six cars are eliminated in both Q1 and Q2. With an 18-car field that would mean that only two cars would be bumped out in Q1 – and with Sebastian Vettel having already stated that he will sit out qualifying due to a power unit change guaranteeing a pitlane start, in reality we could see only one car bumped in Austin.

However, the FIA Sporting Regulations include the provision for changing the number of cars that are eliminated. The numbers specifically referred to are eight for a 26-car entry, and seven for a 24 car entry. It follows that with an 18-car entry four cars would be bumped from Q1 and Q2.

The regulations refer to the size of the ‘championship’ entry rather than that for an individual race. However sources confirm that once the stewards have officially been notified that only 18 cars are in the Austin field they will have the option to decree that four cars are eliminated in Q1 and Q2.
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Steve · Oct 27, 2014

Misleading title; this is about more than just what happened to Caterham and Marussia.

The demise of Caterham and Marussia explained (MotorSportMagazine.com)

By Mark Hughes | 27 October 2014

With the news that both Caterham and Marussia will not make it to the US Grand Prix this weekend, what was always inevitable is now unfolding. The greedy commercial model upon which F1 is run is not sustainable and never has been; the self-interest of the big teams in refusing to ameliorate the worst implications of that on the rest of the grid has just hastened things along. Greed has ensured that the sport is now beginning to eat itself.

Formula 1 generates an income of around $1.5 billion each year, but a big chunk of that leaves the sport because it is owned by outside entities with no interest in it other than as a revenue generator. Yes, the big teams are guilty of having been irresponsible in inflating their size four and five-fold in the big money years of the late â€˜90s/early 2000s â€“ something that was never going to be sustainable.

But they are competitive entities and could not have been expected to stand by and not take advantage of the car manufacturing money that was then spilling into the sport while watching others leap ahead. They needed and continue to need cost caps imposed upon them to protect them from their own competitive greed.

Yet even without that and even with the pastâ€™s irresponsibly vast expansion in the sizes of teams, this could still be a self-financing sport. It absolutely generates enough money to make that possible, but only if the teams themselves owned it and distributed the proceeds equitably. But F1 was sold out many years ago. The commercial rights used to be held collectively by the teams, which were represented by Bernie Ecclestone. But one day, when the lease expired, Bernie re-applied for them himself â€“ and not as a representative of the teams. Again, the teams could be criticised here for they should not have made the assumption that Bernie would continue to act in their interests. Why should he, just because he had done in the past?

Bernie and his former team boss cohort Max Mosley had tried by force to take the commercial rights for the teams from the FIA in the 1980s and failed. But in the early 2000s they succeeded in doing it for Bernie by infiltration and stealth. When Max, as FIA President, signed over the rights to Bernie for a further 100 year term for just Â£360 million (about the same as for one yearâ€™s worth of NASCAR commercial rights), he effectively handed the keys of the sweet shop over to a sugarholic.

Ecclestone sold and re-sold those rights until CVC came along and paid $2.5 billion for a controlling interest in 2005. That netted Bernie an obscene profit and CVC subsequently a much bigger one. It has taken around $4 billion from the sport and raised a further $2 billion by selling chunks of its ownership â€“ and with the sport valued so much higher now than when it bought, it stands to gain further billions.

This would all still have been sustainable had not the economy collapsed a few years ago. But thatâ€™s what economies do. Thatâ€™s what it was always going to do someday, and why the teams should never have been allowed to get so big, and why the money should not have been leaving the sport to outside entities. But that would have needed an enlightened despot ruling with a rod of iron, forcing a ceiling on costs, allowing teams to take franchises in the sport, generally being a responsible guardian.

Perhaps realising the mistake of that 100-year deal (or maybe not), Max proposed that for 2010 teams that could operate on a budget cap of Â£40 million (at a time when the top teams were nudging Â£200 million) could enter under favourable technical terms. Neither the budget cap nor the technical favours ever transpired but three new teams (which later came to be known as Marussia, Caterham and HRT) were attracted to F1 under the initiative.

HRT went at the end of 2012 and now it looks like the end has come for the remaining two. But itâ€™s unlikely to stop there as the goose that keeps laying these golden eggs for the sportâ€™s owners is being slowly strangled. The big teams are too big to bring their spending down to a level appropriate for the money thatâ€™s left after the owners have had their share. But they have used their power over the smaller teams to insist they be paid more.

Effectively the cake is too small in the first place and then they have taken too much of what is left â€“ because they can. They have got the small teams to subsidise their unrealistic spending. And now the small teams are beginning to go out of business.

Donâ€™t let anyone ever say this couldnâ€™t have been foreseen. Itâ€™s been coming ever since that 100 year deal was announced 15 years ago.
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mrntd · Oct 28, 2014

The FIA only has itself to blame for teams dropping out. They knew teams were on the edge a few years ago but they still went forward with the massively complex and expensive rule changes that changed the entire car and engine. All for what purpose? The only thing we got was a change in dominant team and small teams going bust.

The teams are never going to agree on a budget cap so the only way smaller teams can survive is by not having to change a bunch of stuff. No they won't be competitive but without the big bucks they never will be. Red Bull spent a fortune to make Jag into a number one team. As did Merc.

So F1 will be a series with a few big buck teams trying to out spend each other in ways to get around the rules. The only small teams will be the number 2 teams for the big guys. So there are 4 big teams with each having a junior makes for 8 teams total. So if your one of the small teams you better find your buddy fast or you'll be gone.

Steve · Oct 28, 2014

I agree, but those engines and other rule change-spawned car redesigns were just the final bundles of straw that broke the overburdened camels' backs. They were going to be circling the drain anyway, just not quite this soon. All the teams are spending too much and there's a non-stop tech spending war that only the big teams can afford. We can say the smaller teams should just stay out of it and live with their back-marker status but they can't afford to just be happy to be racing. They're still fighting for the last few Constructor's Championship positions and the money that comes with them, plus any success can help attract sponsor money, that allows them to keep going. Sort of fits the old business model "need to spend money to make money", but at the back of the grid they're fighting a different version of the law of diminishing returns.

Teams dropping out because they're out of money is as old as F1 but these days it's so expensive there aren't a bunch of wannabe shoestring-budget teams waiting in the wings to jump in when someone else drops out.

In addition to all the cash Bernie and CVC suck out of the sport (billions), there are plenty of other issues. And, like I said, the new engines, etc, are just the latest tip of the iceberg. Look at the costs below (midfield team costs) and remember even that $28M figure for engines isn't an additional $28M. They had to pay for the V8s as well, just not as much (I'll guess half).

Analysis: Why small teams can't afford F1 amid Caterham/Marussia woe (autosport.com)

Jonathan Noble | Tuesday, October 28th 2014, 09:59 GMT

Formula 1 has long been an expensive game, but the absence of Caterham and Marussia from the Austin grid has reopened debate about whether its business model is now unsustainable.

While the loss of one team could be put down to isolated circumstances, that two outfits have gone into administration just days apart is a clear indication that something is amiss.

It comes amid repeated warnings since the start of the season that F1's finances were out of control, especially after FIA president Jean Todt revealed that he had abandoned efforts to implement a cost cap because of resistance from the big teams.

That move left smaller outfits hugely upset - at a time of falling sponsorship income, the costs of competing were being ramped up by the spending war at the front of the grid, plus the arrival of the new turbo V6 hybrid engines.

But while it has always been a challenge to pull together the budgets needed to compete in F1, the disconnect between what teams can earn and what they are spending has never been greater.

Amid the smaller teams' efforts to convince Todt to persist with the cost cap earlier this year, they revealed the real costs of competing in F1.

A letter written to Todt by Caterham, Marussia, Sauber and Force India, a copy of which has been seen by AUTOSPORT, laid bare just how expensive F1 was.

It provided an example of what a midfield team was now spending - excluding driver salaries, building leases, hospitality, marketing and media.

Bigger teams are spending more, in some cases much more, while F1's minnows Caterham and Marussia have been trying to get by on much less.

The breakdown for an average team went as follows:

Hybrid power system $28 million
Gearbox and hydraulics $5 million
Fuel and lubricants $1.5 million
Tyres $1.8 million
Electronics $1.95 million
IT $3 million
Salaries $20 million
Travel and trackside facilities $12 million
Chassis production/manufacturing $20 million
Windtunnel/CFD facilities $18.5 million
Utilities and factory maintenance $2 million
HR and professional services $1.5 million
Freight $5 million
TOTAL $120.25 million

Of course such high expenditure only becomes an issue if income does not cover it, which is where much of the current problem has materialised.

Income from F1's commercial rights is only around $55million - roughly half of the cost of competing - for a midfield team like Sauber or Toro Rosso.

Amid a global financial slowdown, and lack of sponsors coming into F1, the gap between income and expenditure has got too high. The economics of F1 no longer work.

While Caterham and Marussia have paid the price of that imbalance for now, there are warning signs elsewhere too.

Williams has posted losses of Â£20 million for the first half of the year, and only a dramatic cut back of expenses at Lotus has prevented it falling further into the red.

But unless the sport faces up to the fact that there is a fundamental problem with the way it is structured, there will be no impetus to change the way teams risk being driven out of business.
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Zapski · Oct 28, 2014

Never mind, I waited too long to post and Steve got my point said better than I could have

B.A.D. · Oct 28, 2014

I see the rumors of Audi moving to F1 are alive and well again with the news that they hired Stefano Domenicali. Would seem like a big lose to the LeMans and DTM series.

Crashton · Oct 28, 2014

I've seen those rumors too. Could it be that Audrey sees an end coming to their LeMans dominance? I'd like to see them in F1, could be interesting.

B.A.D. · Oct 28, 2014

Crashton said: ↑

I've seen those rumors too. Could it be that Audrey sees an end coming to their LeMans dominance? I'd like to see them in F1, could be interesting.
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The one rumor I read had it coming down from the VAG overlords to cede LeMans to their Porsche brethren.

mrntd · Oct 29, 2014

Looking at the costs Steve put up so many of them aren't really discretionary. I can't see how the $40 mil cap they proposed a few years ago could have ever worked. Just to do a $100 mil cap the sport would have to seriously de-tech.

Steve · Oct 29, 2014

I thought the same thing. I'm assuming every time we hear of some sort of a 2-figure cap like that they must be trying to put a ceiling on only certain costs but I've never seen an explanation.

Given the numbers in the article come from teams trying to convince the FIA that costs are too high, there may be more than just a bit of exaggeration to make the point. But I can't believe they would have inflated $40M to $120M. And don't overlook this little gem: "...an example of what a midfield team was now spending - excluding driver salaries, building leases, hospitality, marketing and media."

One thing those numbers show is the budgets also go up every time Bernie increases the number of races on the calendar. I knew his company handled shipping from race to race but didn't realize it was just his company making the consolidated arrangements, etc, presumably to get a better deal, and the teams have to pay. Shows how important it is to coordinate the race schedule by geography.

Steve · Oct 29, 2014

:lol:

Steve · Oct 30, 2014

Daniel Ricciardo reportedly celebrating Choptober...

Steve · Oct 30, 2014

Here's an interesting idea for partial reform as F1 grapples with costs, etc. I can't remember where I read this or I would attribute the source...might have been an article on Racecar Engineering, not sure...or maybe it's an amalgam of things I've read here and there...

The idea is a sort of 2-tiered system. Teams pick a tier to compete in and stick with the rules associated with that tier unless and until they decide to switch.

Tier 1. More or less what we have today, for those with plenty of money to spend and the will to spend it. No cost cap but lots of technological limitations imposed via rules set in place for the sake of safety and, supposedly, competition.

Tier 2. Strict cost cap but lots of room for engineers to innovate due to removal of competition-enforcement rules and allowance of nearly any form of engine and aero. Lack of big money means rather than spending through the roof in a losing battle against the law of diminishing returns, engineers and designers would be free to choose different paths while forced to work within budget. Might result in different designs, all in competition on the track, and potential for real world-related innovation. Also potential to allow single car teams under this tier.

Yes, I know it sounds a lot like sports car racing with more than one class on the track, but I don't actually dislike that idea. Plus the difference here is there would be no system put in place to guarantee the more expensive tier can outpace the other (like prototypes given performance advantages so they will always outperform GTs, etc) so there's potential for surprises and real wild cards. Each team given a choice: if you want an unlimited budget, you'll be severely restricted in terms of design; if you want less restrictions, spend less money.

Wadaya think? Full of holes? Says nothing about the rest of the reforms they need (IMO) like better distribution of earnings, etc, etc, etc, this is just about finding a way to allow the rich teams to spend like they're printing money while others are protected from the non-stop tech spending war yet still allowed room to make choices and innovate.

Also, I already know it'll never happen. No need to remind me. Doesn't change the fact that I like the idea. :biggrin5:

Steve · Oct 30, 2014

Lotus are testing a new nose this weekend.

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