Budget cap could increase costs

[Hondo]

I don't know all the details of the budget caps but as sloppy as the FIA is, there is bound to be loopholes for some of the teams that do their own engines and chassis. Just for fun, let's say you have an established team called Tucker F1. Currently, Tucker builds it's own chassis and engine. Under the new cap Tucker F1 is limited to spending 60 million Euros. Tucker immediately starts spin off companies, i.e., Tucker Aero, Tucker Composites, Tucker Electronics, Tucker Software, Tucker Engines, and Tucker Competition Promotions.

Tucker F1 can dismiss the necessary engineers and techs to staff and equip the spin off companies. The sponsors buy into Tucker promotions, who in turn, distribute the necessary funds to the spin offs and contract with Tucker F1 on how to decorate the car. Of course now you'll have to employ more office staff and bookeepers to administer the spin offs.

Tucker wouldn't have any trouble competing under the cap, especially with a lease deal on engines from Tucker Engines for a 1000 Euros a year, etc. Nobody loses their job and in reality, nothing has really changed except the paperwork.

It could be done.

[Koz]

Sure, this is exactly the way it will be done.

Most of the costs are R&D aren't they?

Outsource that R&D to XYZ Industries based in XYZ country where private companies don't have to disclose financial info to anyone, let them do everything. And team ABC buys the design for... $50, and there you have it.


It's really easy to do this kind of thing. Now how much money will the FIA spend on keeping tabs on all these teams?

Rather have no limit, than some farce of a limit which will never be adheared to anyway.

[wmcot]

That's the problem with Max trying to dictate a budget cap! Right now, each team has its own "budget cap" dictated by the team owners, sponsors, and so on. Some of the teams have more resources than others - that's life.

It's a bit like Max saying that all employees of any company in the UK will now earn 2 pounds an hour regardless of who you work for or what your job is - can you say "revolution?"

[leopard]

The idea of budget cap represents serious concern over global financial environment to elude championship from disastrous situation comes afterward some major finances already long sponsoring F1 such as Credit Suisse put an end their collaboration with BMW and ING revealed the same of end up their partnership with Renault in the next coming seasons.

Teams may run budget to exceed the limit, but let look at the rule as a good initiation that F1 isn’t wasteful of money. This isn't yet even a season running under the rule of budget cap, I’d rather see this a breakthrough with positive sentiment until it’s proven wrong …

[V12]

Indeed.... I do find it funny that people elsewhere constantly bring up Max's "Nazi" heritage...when in all reality he's the biggest Communist going, at least with regards to his running of F1.

And yes the budget cap will probably increase costs...any rule change increases costs. F1 is inherently competitive and those competitors (that's right Max, F1 teams are competitors, not "departments of the same business" to be streamlined and rationalised) will constantly be trying to find ways to outdo each other, particularly when the rules are changed (RE: the double diffuser thing"). Because their ultimate aim is to get to that chequered flag before everyone else does.

Financial capping has caused sporadic controversy and rule-bending in sports such as Rugby League, where the clubs will have far less complex business structures than a top F1 team. This is going to get VERY messy...

Having said that, if the alternative is "standard parts" to save costs - I'd take a budget cap and all the pain and aggro that comes with it every time.

Or how about this.... Teams carry on spending what they can afford to spend. You know, a bit of self-regulation? Worked for the past century or so. If these new teams are suddenly able to put cars on the track for 40 mil a year, why don't they go ahead and do it anyway? Yeah so they'll be at the back, boo-hoo, of course they'll be at the back until they get established, they probably would with the budget cap anyway.