FOTA trouble is good for Bernie Ecclestone

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Christian Horner, Bernie Ecclestone, Red Bull, Interlagos, 2011

Christian Horner, Bernie Ecclestone, Red Bull, Interlagos, 2011

Ferrari and Red Bull have handed Bernie Ecclestone an early Christmas present.

The news that two of F1’s richest teams have left the Formula 1 Teams’ Association in a dispute over the Resource Restriction Agreement is a potentially mortal blow to FOTA.

With discussions pending over the new Concorde Agreement – the document governing how F1 is run – Ecclestone now knows the teams won’t necessarily be presenting a united front to safeguard their interests.

Yesterday both Red Bull and Ferrari issued statements stressing the important of controlling costs. It’s hard to take that at face value when they’ve abandoned the body which is best-placed to agree on future cost reductions.

Ferrari and Red Bull abandon the RRA

On the Friday of the Brazilian Grand Prix weekend Horner expressed hope that a solution could be found to the disagreement over the RRA:

“We met this morning and it has been decided that the RRA has effectively been taken out of FOTA for the time being, to try and achieve a solution.”

He added: “I think an RRA is important for Formula 1 and I think all the teams are unanimous on that. I think the thing that isn’t quite clear is how to achieve it in a way that fits everybody’s business models, that some of the teams are different, and I think the key thing for us is that the treatment and transparency of it is consistent and obvious and probably needs to go beyond the chassis and incorporate the engine as well.

“You can’t cherry-pick, you need to look at the package as a whole. Hopefully, in discussions prior to the end of the year a solution can be found but I think that inevitably we come more under the spotlight because, as I said earlier, perhaps if we hadn’t had as much success this year then it would be less pertinent but that’s the way of the world, but from a Red Bull point of view we’re keen to find a solution and we’re hopeful that one can be found between now and the end of 2011.”

Horner had previously played down the important of FOTA, saying in a joint interview with Bernie Ecclestone earlier this year he “doesn?t spend too much time thinking” about the teams’ organisation.

Whereas Ferrari’s hostility to resource restrictions such as limits on testing is no secret, on the surface it may not appear obvious why Red Bull might be dissatisfied with the status quo.

Testing and resource restrictions have not kept them from winning back-to-back constructors’ championships plus a pair of drivers’ titles for Sebastian Vettel.

As Horner alluded to, Red Bull have been vexed by insinuations (some originating in Maranello) that they have not respected the RRA and therefore have unfairly earned their success. None of these claims have been backed up by proof, but they highlight a fundamental weakness of the RRA – the difficulty of assessing who has stuck to the cost controls.

Engine development

Beyond maintaining the existing RRA, teams faced a further challenge in incorporating the new engine rules for 2014. We may be more than two years away from the first race with V6 engines and highly complex new energy recovery systems, but development of the units began months ago.

Under the current engine freeze the RRA has little effect on engine development. But the prospect of teams building new engines for 2014 presented a complicated challenge.

The difficulty of finding a fair formula to extend the RRA to include engine development beyond the current frozen-specification V8s is plain to see. Next year four teams will be supplied by Renault, three each by Mercedes and Ferrari and two by Cosworth. On top of that, Ferrari and Mercedes have their own F1 teams but Renault and Cosworth do not.

Renault’s Jean Francois Caubet explained last week: “We want to avoid the same situation we had three or four years ago.

“I think in the cost of engines, you have fixed and variable costs. All the people are selling the engines on the variable costs, so if you control the fixed costs it will be easier.

“We agree with Mercedes to share the same philosophy with Ferrari. It is a little bit late because all the investment for the 2014 engine has started, but the problem will be after 2013, probably, to accept the RRA.”

Advantage Ecclestone

Red Bull and Ferrari’s decision to leave FOTA and, therefore, ditch the RRA, leaves McLaren and Mercedes with little choice other than to follow their lead. The only alternative would be to tie their hands by continuing to restrict their spending, which looks unrealistic.

But the impending collapse of the RRA and FOTA has ramifications beyond just unleashing a fresh frenzy of spending by F1’s richest teams.

With the teams poised to negotiate a new Concorde Agreement, Bernie Ecclestone will be rubbing his hands with glee anticipating only having to deal with a weakened FOTA union.

If this all seems like history repeating it’s because it is. Past F1 teams unions – including one run by Ecclestone himself in his Brabham days – have always ended with a split.

The next step is for Ecclestone to pull his usual trick of offering Ferrari a preferential deal to stay in Formula 1, eventually leading to the capitulation of the remaining teams. And don’t be surprised if a few more items on Luca di Montezemolo’s shopping list – more testing, three-car teams – appear as well.

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69 comments on FOTA trouble is good for Bernie Ecclestone

  1. The Limit said on 6th December 2011, 18:21

    Quite true Keith. This news is also very damaging to the smaller teams in Formula One who don’t build expensive Italian sportscars or have energy drink money behind them. It just goes to prove the old saying that ‘money talks’ and F1 is most definately based on money. The teams, especially the big teams, have moaned about the restrictions on testing for years which is nothing new. I am not a supporter of Ferrari’s idea of three car teams, we would lose the smaller teams within a few years if that happened and no one wants that.

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