Should F1 drivers take pay cuts?
11th December 2008, 16:00 by Keith Collantine 27 Comments »
Kimi Raikkonen is believed to be F1's highest-paid driver
NASCAR star Jeff Gordon has offered to take a pay cut to ease the strain on his team during the financial crisis:
I’ll do whatever it takes for us to have the best team we can possibly have. If that means take part of my salary to keep certain people on… I would be open to it. I never got into this to make millions of dollars.
Is it time Kimi Raikkonen, Lewis Hamilton and F1′s other big earners followed Gordon’s lead?
The exact sums earned by F1′s top drivers are often speculated on but rarely known for certain. However the elite F1 drivers certainly command eight-figure salaries, and that goes for world champions Kimi Raikkonen, Lewis Hamilton and Fernando Alonso plus many of their rivals.
Max Mosley wants to cut F1 teams’ budgets to $20-40m – around a tenth of what they are now. But if that’s going to happen, surely the drivers will have to take pay cuts?
Frank Williams is sceptical about that ever happening:
Drivers’ salaries are the one major snag, an area not addressed in the teams’ unified decision to reduce spending. If McLaren don’t want to pay Hamilton £15m, then someone else will. Any suggestion of a gentleman’s agreement on this would never happen.
It seems to me the only way this would happen would be if the Grand Prix Drivers’ Association agreed all its members would offer to take pay cuts. And even then it wouldn’t have much of an effect on drivers who are expected to bring money to their teams, such as whoever Toro Rosso puts in its cars next year.
Are F1′s mega-salaries here to stay? Which F1 drivers are overpaid? Have your say in the comments.
Scootin159 said on 11th December 2008, 16:26
Nearly every professional sport in the US has some sort of ‘salary cap’, that is the maximum amount any one team can pay for all if it’s players combined salaries.
The scenario runs into some snags due to each team having only two drivers however. In most salary capped sports, the “Lewis Hamiltons” are just given large salaries at the expense of the lesser players on the team. Perhaps in F1 it would just make sense to have a ‘per-driver’ cap?
Or, perhaps you simply ignore the issue and just join it with the team budgets. That would give each team the choice of spending their $$$ on good drivers or good cars. THAT would make for some interesting racing…
Chaz said on 11th December 2008, 16:27
Supply and demand… I think it will all work it’s self out in the end…
Oliver said on 11th December 2008, 16:36
Why take a pay cut if your teams isn’t having trouble?
SuperKarateMonkeyDeathCar said on 11th December 2008, 16:36
One thing not mentioned in the article is that Gordon is part owner of the team, so he has a greater interest in the team’s bottom line than any of the other drivers at Hendrick.
Oliver said on 11th December 2008, 16:40
From what I gather, driver pay will be out of any agreement reached concerning reducing costs. It’s up to a team to decide how much a driver is worth. Lewis isn’t earning as much as Kimi or Alonso.
Seedy001 said on 11th December 2008, 16:47
Good point from SuperKarate which I was also going to make. Also, Keith, the problem with your GPDA idea would be that two of the drivers you mentioned, KR and LH, aren’t even members and I don’t think FM is either! The best teams will continue to employ these 3 and Nando because they’re the best – so I don’t think driver pay cuts are going to happen
Tim said on 11th December 2008, 16:51
Difficult one. Would the cap cover the salary paid by the driver’s team or would it include personal sponsorship and endorsement deals as well? How could teams be prevented from arranging for their main sponsors to pay drivers directly and reduce the amount the goes to the team accordingly? Would benefits in kind count – e.g. Mercedes providing Lewis Hamilton with the use of an SLR or Ferrari covering Felipe Massa’s travelling expenses? Would cross subsidy (the income from a pay driver being used to fund the other driver’s salary) need to be taken into account as well?
I’m not sure the GPDA idea would work – drivers aren’t required to be members and not all currently are.
Keith Collantine said on 11th December 2008, 16:59
SuperKarate – Ah I did not know that (I don’t watch NASCAR).
schumi the greatest said on 11th December 2008, 17:02
i have to agree with what frank williams said, its not too hard to believe that if all the teams made some sort of “gentlemans agreement” to not pay any driver say over £10million a year, someone like ferrari would go and nab hamilton on a massive salary or something!
i think a budget cap that included everything, driver salaries, manafacturing, designing r&d, oversizes motorhomes, chefs, you name it a complete budget limit for everything!
quite how the fia would police that i have no idea but i think that is the best way forward
Too Good said on 11th December 2008, 18:07
Driver Salaries were not part of cost cutting measure proposed some time back.
Drivers Salary is Akin to C-Execs Bonuses and Paychecks, the Organization may be limping, but will that stop from execs to make their bucks no.
In case of drivers though, the teams will bump them off on slightest of excuse or difference of opinions,a lot more happens internally with the team to which we have no visibility. So I wouldn’t blame Drivers to act in their self interest. Charity is not a one way street
GeorgeK said on 11th December 2008, 18:17
Jeff Gordon is half owner with Rick Hendrick of the 48 car driven by 3 time champion Jimmie Johnson. The other 3 cars are owned by Rick Hendrick, possibly in partnership with others.
Most NASCAR drivers like Gordon make more in outside sponsorship than in salary and race winnings, hence his willingness to give his salary back to the team. Regardless of it’s impact to him personally, he is making a responsible gesture out of loyalty to the team that has made him a millionaire and a 4 time champ.
theRoswellite said on 11th December 2008, 18:21
Chaz is correct.
Pure market forces are at work here. Whatever they can get, is, by definition, what they deserve. Each team must decide what they can afford, just as each driver needs to “price” his services.
In fact, the question, “How much should they make?”, is fallacious because there is no established and universally accepted standard to which the word “should” can apply.
The only parties relevant, indeed necessary, to deciding this issue should be the driver and the team.
Please, no arbitrators, or judges, or informed committees…
S Hughes said on 11th December 2008, 19:32
Oliver, Lewis isn’t earning as much as Button unbelievably enough!
Oliver said on 11th December 2008, 20:36
Very true S Hughes.
Chris Johnson said on 11th December 2008, 22:45
Drivers have relatively short, somewhat risky careers. The best ones would never agree to a salary cap or reduction. Anyway, having “stars” is part of the appeal of the sport.
This all starts to sound like just a big game of F1 fantasy manager. Give every team the same budget, and out of that, they have to pick an engine, chassis, tyres, and two drivers.