The New Concorde Agreement

[EuroTroll]

Interesting blog post on Sky News: Ferrari Poised For F1 Stake As CVC Plots $10bn Float | formula_one | ferrari | concorde_agreement | Kleinman | Sky News Blogs (http://blogs.news.sky.com/kleinman/Post:043abc2d-8548-48a9-bd7b-4f9a1681a96a)

Most interestingly:

A proposal for the introduction of Single Car Customer Teams which would allow new entrants to use cars deployed by other constructors during the previous season.

[Mark]

They've been talking about customer teams for as long as I've been following F1. Never been in favour of it, it dilutes the premise of F1. But then it could be argued the likes of Torro Rosso - and before that Ligier, is already doing that.

[Knock-on]

I know that Ferrari and RBR are rumoured to have aditional benefits over the other teams but hope this is just poor reporting. I suspect that the other teams will have the same influence but haven't commented on it.

However, anythng can happen in F1 and usually does :s

[wedge]

They've been talking about customer teams for as long as I've been following F1. Never been in favour of it, it dilutes the premise of F1. But then it could be argued the likes of Torro Rosso - and before that Ligier, is already doing that.

I'm all for component sharing like with have with gearbox.

I like what happened with Super Aguri where they developed the Arrows themselves. Certainly they/future teams shouldn't have/be relying in hand-me-down aero parts.

[schmenke]

.... Never been in favour of it, it dilutes the premise of F1. ....

It does somewhat defeat the purpose of a constructors’ series doesn't it? :mark:

[ArrowsFA1]

It does somewhat defeat the purpose of a constructors’ series doesn't it? :mark:
Not if the WCC points go to the constructor as opposed to the team :) In fact there could be three world titles - driver, constructor and team.

[schmenke]

Not if the WCC points go to the constructor as opposed to the team :) In fact there could be three world titles - driver, constructor and team.

Fair enough, but if I, say, “purchase” a car from McLaren but decide to swap the engine for one from Renault and purchase wings from Red Bull (where else :p : ), who would get the Constructors points?

Or am I misunderstanding "customer" car? :mark:

[Tazio]

I know that Ferrari and RBR are rumoured to have aditional benefits over the other teams but hope this is just poor reporting. I suspect that the other teams will have the same influence but haven't commented on it.

However, anythng can happen in F1 and usually does :s According to the link that Arrows posted it appears that Ferrari will (possibly) get even more than they were receiving because of their prominence.


According to the papers, parts of which I’ve seen a copy of, Ferrari would be eligible to apply for a share in F1’s holding company by virtue of its status as the team which has competed in the highest number of seasons since 1950. Although it’s unclear from the document whether this share would have anything other than a symbolic value, it is conceivable that as F1’s most important team, Ferrari would be handed an interest worth tens of millions of pounds in the event of a sale or stock market listing of
F1.

I understand that Ferrari and Red Bull have already agreed in principle to sign up to the new commercial framework (which is unsurprising since they get by far the best financial deal from it).
This is the part of the deal I dont like.

[ioan]

10 billion USD?
They bought it for about 3 billion USD and want to cash in 10 billion? Maybe Greek Drachma.

[schmenke]

As I understand it, because neither Ferrari and RBR are not currently members of FOTA they are free to negotiate their own commercial agreement with the FOM.

I don’t know where the $10B comes it. All I’ve read is that the CVC group has allegedly offered Ferrari and RBR shares of their operations, and may be looking at floating some of them on the market.

What this means to the distribution of the sporting revenues to the other teams, I don’t know. I can only assume that the remaining FOTA teams will have to negotiate separately with the FOM?

:cornfused:

[call_me_andrew]

Somehow I think I'd be more excited for a new Concorde. :p

[racoon5022]

10 billion USD?

[Tazio]

That's what the link said was the number they were talking about of F1's total Value

[schmenke]

I can't open the link for some reason :s
I've read in other sources that the $10B is the estimated value of shares allegedly to be floated on the market.

[EuroTroll]

I can't open the link for some reason :s

The link still works for me. :s

And here's another: Formula One wheeling and dealing « (http://joesaward.wordpress.com/2012/03/20/formula-one-wheeling-and-dealing/)


The other teams have a right to feel betrayed as Ferrari and Red Bull were members of the Formula One Teams’ Association and went through the motions of looking for a better way for the commercial side of the sport to be organised before swapping sides to feather their own nests. The collapse of any realistic collective bargaining means that the teams have once again been divided and will be conquered and will end up with a smaller share of the sport’s revenues than perhaps they should have had.


Ecclestone is an unlikely boss for a quoted company as transparency has not always been his idea of how business should be done and while the stock exchange in Singapore might allow him a little more flexibility than London or New York, in terms of disclosure, the value would be less. At the moment there is a move to try to make F1 look as though it is worth $10 billion, but this seems like a lot of drum-banging.

[ioan]

I can't open the link for some reason :s
I've read in other sources that the $10B is the estimated value of shares allegedly to be floated on the market.

Did they ask Goldman Sachs to estimate the value of the shares?! :D

[Tazio]

The current majority owners just bought their shares with the consideration that Ferrari F1 was worth 3 billion a year ago.

[EuroTroll]

It seems (from Joe Saward's blog post) that the single car customer team idea is just there to put pressure on the lesser teams to sign up. We'll likely have a championship of only constructors after all.

[ioan]

The current majority owners just bought their shares with the consideration that Ferrari F1 was worth 3 billion a year ago.

Ferrari as a whole might be worth that much, not Ferrari F1 anyway.

[BDunnell]

Fair enough, but if I, say, “purchase” a car from McLaren but decide to swap the engine for one from Renault and purchase wings from Red Bull (where else :p : ), who would get the Constructors points?

Or am I misunderstanding "customer" car? :mark:

Well, it's long been a debate. The BRP team was most miffed in the mid-1960s (I forget exactly which year) when what it considered to be its own car was deemed not to be, seeing them lose out on various benefits constructors were given. It was one of the reasons that precipitated that team's withdrawal.

[Tazio]

Ferrari as a whole might be worth that much, not Ferrari F1 anyway.
Thanks ioan I got confused with all the billions and millions going around :mark: I also noticed that I credited Arrows with a link that was posted by studios :mark:
apologies all around :)

[EuroTroll]

I also noticed that I credited Arrows with a link that was posted by studios :mark:
apologies all around :)

Hehe, no problemo. :)

[Knock-on]

Thanks ioan I got confused with all the billions and millions going around :mark: I also noticed that I credited Arrows with a link that was posted by studios :mark:
apologies all around :)

You're so confused you seem to have forgotten your name :D

[EuroTroll]

'Majority' of Formula 1 teams commit to new Concorde deal - F1 news - AUTOSPORT.com (http://www.autosport.com/news/report.php/id/98317)


"I am very pleased to announce that we have reached commercial agreements with the majority of the current Formula 1 teams, including Ferrari, McLaren and Red Bull Racing, about the terms on which they will continue competing in Formula 1 after the current Concorde Agreement expires at the end of this year," said Ecclestone.

[EuroTroll]

Mercedes remains silent on future F1 deal - F1 news - AUTOSPORT.com (http://www.autosport.com/news/report.php/id/98347)


One source suggested that the Treaty on the Functioning of the European Union, which specifically outlaws restriction of competition in Article 101 and the abuse of a dominant position in Article 102, could be used as the basis of a test case to challenge the way in which Ecclestone has offered preferential terms to some teams.

Mercedes refused to comment on whether or not legal action was being considered.

[truefan72]

I hate the concorde agreement and all the secrecy and favoritism it produces
It is so unbalanced and arbitrary that it is laughable it is called a concorde agreement

The closest example to this is purchasing airline tickets for a particular flight, with its 20 different price codes, different classes and different restrictions, even though you are on the same plane going to the same destination.
...and that's just the economy fares. Let alone the "first class" seats that RBR and Ferrari are getting for less than a penny.

I think there should be transparency and proper revenue sharing when it comes to paying these teams as part of an overall TV/broadcast packages
you can then make additional bonuses based on performance and WDC/WCC championships

But if you pay $400 million to enter the series and then get zero dollars out of the deal then it is no surprise that teams will continue to struggle, and older struggling teams will just continue to go in a downwards spiral.
Williams was only saved by the addition of a pay driver and floating their company.

[ioan]

Did they ask Goldman Sachs to estimate the value of the shares?! :D

It looks like it is indeed Goldman Sachs who will be in charge of floating F1 and who are estimating it to $10 billion! Does Greece ring a bell?

Formula One wheeling and dealing « (http://joesaward.wordpress.com/2012/03/20/formula-one-wheeling-and-dealing/)

[EuroTroll]

Another bit of information from James Allen's blog (http://www.jamesallenonf1.com/2012/03/ferrari-drivers-visit-maranello-for-talks/):


One of the likely outcomes of the new Concorde Agreement, called for by Montezemolo, is the return of a bit more testing in 2013.