Formula 1 teams agree on cost reduction plan

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The teams reached agreement despite differing opinions on the budget ceiling.

Formula 1 teams have agreed to a set of cost-cutting changes to help the sport overcome the coronavirus pandemic, BBC Sport may reveal.

The teams voted to accept a plan to reduce the budget ceiling that will be introduced next year from $ 30 million to $ 145 million (£ 114 million).

This amount will be further reduced to $ 140 million in 2022 and to $ 135 million for the period 2023-25.

It is a series of measures to cut costs and level the playing field, including a handicap system for research and development.

The package has yet to be officially approved by the F1 legislative body, the FIA ​​World Motor Sports Council. Its vote will take place next week and should be a formality.

How did it happen?

F1 had already agreed to introduce a budget cap of $ 175 million in 2021 last October, but the potential for lost revenue from the coronavirus has led to calls to lower the figure.

A split emerged between the three big teams and the others, Ferrari and Red Bull in particular, opposing a drop in the ceiling below $ 150 million, while McLaren was among those calling for such a low figure. than 100 million dollars.

But the teams finally agreed on a compromise that everyone can accept, according to a certain number of personalities who wished to remain anonymous.

Ferrari had argued that any figure below $ 150 million would force them to cut hundreds of jobs, but they feel they have made a series of significant sacrifices for the good of the sport.

Among these are their acquiescence in a significant reduction in aerodynamic development in the 2020 and 2021 seasons, and a delay in the introduction of new rules in 2022.

Ferrari accepts that their 2020 car is not as competitive as they would have liked, so having to drive it for two years with minimal development possibilities could delay their chances of participating effectively in the world championship until 2022 .

McLaren is lobbying to lower the budget ceiling for what they see as a more level playing field

Radical steps for an unprecedented situation

One of the most radical aspects of the rule set is the plan to limit aerodynamic development for the best performing teams.

There will be a defined benchmark amount of wind tunnel time and computer data allowed, and a sliding scale for allocating this R&D based on a team’s final position in the previous championship.

In 2021, to take into account that teams must develop cars according to the new rules in 2022, the team that finishes first this year will be entitled to 90% of this quota, with a sliding scale of 2.5%, of so that the team that finished gets 112.5% ​​last.

From 2022, world champions will be entitled to 70% of the total allocation, with increases of 5% until the team that finishes last is authorized at 115%.

All new teams would receive the same allocation as the team that finishes last.

The teams of manufacturers have negotiated a consideration on a subject known as the “notional value” of customer parts.

This rule defines an appraisal for parts generally purchased by smaller teams of manufacturers, such as gearboxes and suspensions.

Once a team has purchased these coins, their defined value is removed from the total amount of that team’s budget cap.

Talks dragged on due to the complexity of these ideas and the need to define all of the potential details within them.

The introduction of a new F1 car design has been postponed to the 2022 season

Is there anything else?

The vote also marked the formal acceptance of a number of other rules which have been widely debated in public and already approved.

These include:

  • The delay in the introduction until 2022 of the new large-scale technical regulations which were planned for 2021 and which aim to make the field more competitive and to allow cars to drive more efficiently
  • The obligation for teams to race their 2020 cars in 2021 as well.
  • The possibility that the format of some race weekends may change to facilitate crowding in as many races as possible after the championship starts this season – for example by compressing track action in two days.
  • The budget limit will decrease or increase by $ 1 million for each race deleted or added to the calendar. Next year, for example, it will be $ 145 million if there are 21 races, but $ 144 million if there are 20 and $ 146 million if there are 22.
  • Restrictions on engine development in 2020 and 2021, including limiting hours on a dynamometer test stand and the number of upgrades allowed per season, as a first step towards reducing engine costs for manufacturers of F1 road cars.

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