In recent months, the idea of having additional ‘capex’ headroom within the FIA financial regulations has gained attention. This proposal aims to create a fairer competition in grand prix racing. Consequently, any decision made regarding this matter could greatly influence the future of the sport.
During the weekend in Budapest, a fresh concept surfaced which proposes that the FIA will assess and approve the specific needs of teams individually, instead of granting all teams equal chances to increase their spending.
The choices will be deliberated during a meeting on Monday by F1’s financial advisory committee [FAC]. This is the platform where the teams, typically represented by their chief financial officers, discuss and negotiate the regulations.
At Friday’s F1 Commission meeting in Spa, team principals will have a final vote. However, there is an ongoing debate about the required number of teams for a decision, whether it should be a simple majority of five teams or a super majority of eight teams.
The topic has sparked discussion ever since the implementation of financial regulations. This is because teams that were historically lacking funds and whose infrastructure didn’t match that of wealthier competitors are now facing difficulties in investing enough resources into new facilities. As a result, narrowing the performance gap has become more challenging for them.
Teams such as Williams, McLaren, Alfa Romeo, AlphaTauri and Alpine all have requirements of varying degrees and have been keen to see an extra allowance that will enable them to invest in the sort of facilities that they need to compete consistently at the top level.
A unique exception has already been granted within the financial rules to allow investment in new wind tunnels. This exception has benefited both Aston Martin and McLaren, enabling them to begin their ongoing projects at their respective factory locations.
Teams are also interested in enhancing their facilities, including simulators, gearbox dynos, and rigs, to align with the capabilities of Red Bull, Mercedes, and Ferrari. They have been advocating for permission to make these new investments.
Alex Albon, Williams FW45
Photo by: Williams
The challenge in terms of reaching an agreement is that the existing leading teams are naturally cautious about assisting their competitors in becoming more powerful.
However, certain individuals who require an upgrade propose that if the larger teams receive an equal additional allocation, they will merely invest it in superior resources, thereby preserving the existing state of affairs.
They desire a system similar to the sliding scale used for aero testing, where teams in need are given more flexibility in their spending compared to those at the top. Historical financial data may be utilized to assist in determining the mechanics of such a system.
An alternative view is that the top teams already have what they need, and thus if the allowance is the same for everyone any extra investment they make on new equipment will produce marginal gains compared to the benefits available for teams that have fallen behind the times.
Finding a way to help only those teams that need an infrastructure boost has been an ongoing topic of debate.
James Vowles, the head of Williams team, is optimistic about finding a solution despite the significant difference in the outdated facilities at Grove.
Vowles expressed that there are valuable discussions, to put it in those terms, according to his statement to Motorsport.com.
We are currently engaged in meaningful discussions, although the challenge lies in reaching a compromise or dealing with the complexity of the situation. Our objective is to discover a solution that benefits all parties involved.
It is currently becoming quite challenging, as each team rightfully has its own unique set of requirements for this.
James Vowles, Team Principal of Williams Racing
Photo by: Williams
Our situation is remarkably distinct from the majority, for evident reasons. Our circumstances diverge from those of Red Bull, Mercedes, and Ferrari, which in turn differ from Alpine and McLaren. The positioning of individuals on the grid reveals what they possess.
Regardless, our current situation is not unfavorable, as there is active communication among everyone. I remain optimistic due to the presence of constructive conversations. However, as is typical in such situations, time is becoming limited. We must make a decision by Friday, which will determine the outcome.
Vowles suggests that currently there are two possible paths to consider. The most recent suggestion is to assess the requirements of each team for individual upgrade projects and then assign a corresponding ‘capex’ allowance.
Vowles mentioned that there is a FAC scheduled for Monday, which he believes will serve as an excellent opportunity to discuss what he considers to be one of two available choices.
“One is just a blanket let’s just raise the capex amount, the same for everyone. Which doesn’t necessarily mean that we’re catching up.
However, the spending capacity of Mercedes, Red Bull, and Ferrari is considerably lower compared to ours. They already possess facilities that surpass imagination. Therefore, I believe this will provide an opportunity for us to narrow the gap.
The second mechanism involves a list where the FIA will review and address any missing or outdated items. They will check off the necessary requirements and provide a specific amount, let’s say X million.
There will be transparency since the additional funds will be assigned to particular projects that teams wish to pursue.
Vowles expressed, “I appreciate that aspect as it is somewhat more comprehensible.”
Max Verstappen, Red Bull Racing RB19
Photo by: Red Bull Racing
There are advantages and disadvantages to both choices. However, it is evident that our goal is to discover a solution that satisfies everyone. It will inevitably be challenging.
Other team bosses outside the established top players are keen to have more opportunity to spend.
“I am unable to reword this text as it does not require any rephrasing.”
At present, this is our stance. We will observe the decision of the majority of the teams.
Franz Tost of AlphaTauri expressed that at present, they are inclined to support this proposal. He believes that investing in infrastructure plays a crucial role in enhancing performance, and allocating more funds towards it would ultimately improve the car’s overall performance. Hence, they are in favor of this initiative.
Alpine team principal, Otmar Szafnauer, is interested in the implementation of a capex allowance. The Enstone team is considering a significant gearbox dyno project that they wish to undertake. Nevertheless, Szafnauer acknowledges that certain competitors require additional assistance.
“I am not as demanding as others,” he stated. “When the FIA inquired about our voting preference, I am not self-centered enough to insist on only satisfying my desires while disregarding yours.”
The main idea is to ensure fairness and equality. Currently, there are a few options being discussed, and I’ve heard that a third one might be proposed during the meeting. Therefore, I will cast my vote based on these considerations.
“I simply require a fair and equal opportunity. The existing infrastructure and tools play a crucial role in achieving optimal results, and it is imperative that we possess comparable resources.”
Pierre Gasly from Alpine A523, Esteban Ocon from Alpine A523, and Charles Leclerc from Ferrari SF-23 are waiting in line to exit the pits.
Photo by: Zak Mauger / Motorsport Images
The cost limit is beneficial, but we did not thoroughly consider all aspects when implementing the freeze.
Szafnauer noted recently that the NFL provides an interesting template for how F1 can try to level the playing field.
Teams in the F1 that desire change received additional motivation following a recent meeting with the organization’s leader.
Szafnauer emphasized the significance of understanding the broader context. During the Canadian event, Liberty and F1 arranged a meeting between the teams and Roger Goodell, the NFL commissioner. Goodell’s main point was that the NFL has been dedicated to elevating itself to a significantly higher standard since the 1960s.
By doing this, each of the teams in the NFL also experienced an increase in their financial status. That was essentially the main point he conveyed.
“They enforce a limit on salaries and also implement a draft system, in which the weakest team has the opportunity to select the most skilled player, among other things. Interestingly, our idea for regulating aerodynamic testing restrictions was inspired by this concept. We introduced a proportional system called the ATR, where the team that finishes in last place receives additional wind tunnel time.”
Roger informed us that while F1 has gained popularity in the US, our priority should be to further elevate its status globally, with a particular emphasis on America.
“He mentioned that if you are able to accomplish that with the complete series, all the teams will also reap the advantages.”
“Capex equalisation goes towards being able to do that – closer racing, better racing, not having just one team winning all the time. And then if the fans enjoy it more, it raises the entire sport.”