Does Maldonado cost more than he brings
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Another crash in fp2. Does Maldonado use up more cash than he brings? Maybe someone in the know can estimate the costs.
No. More money is put into R&D than the car, and I think Maldonado brings enough to have a decent effect on R&D, which I’m pretty sure his crashes go nowhere in negating.
I’m not an expert.
No, he brings a lot more money than he uses up.
A quick google search indicates that Maldonado is bringing somewhere in the region of £30m. Another quick google found me a video by Eddie Jordan showing how much crashes can cost. A front wing/nosecone assembley is about £100k, suspension is about £150k a corner etc. He also detailed two big crashes in recent years – Perez’s monaco crash 2011 and the first corner incident at Spa 2012. Perez’s crash would have cost about £600k, and the TOTAL cost of the Spa 2012 would have been about £1.5 million.
It’s pretty clear that even if he caused £1.5M worth of damage every race weekend, they’d still be making money. Even then, most weekends he causes nowhere near that amount of monetary damage.
The answer to the first question might be YES, but it remains a wild guess with many uncertainty.
There are other potential ‘costs’ which are not related to replacing a nose-cone or suspension.
Firstly there are points to be earned, which translate into prize money at the end of the season. This can be a lot of money. The difference between 1st and 2nd is some $10.5m, and it can even be as much as $49m for Catherham between finishing 10th or 11th this year ($35m tier 1, plus $14m tier 2).
But the impact for Lotus is likely to be much less. The difference in prize money between 8th (current ranking) and 7th is ‘just’ $3.5m.Secondly, ‘opportunity costs’. By having PDVSA sponsoring Lotus, they can no longer ‘sell’ this sponsorship to somebody else. According to this site the advertising spots are worth $35m ($25m for the wing, $5m wing end-plates, $5m front wing). But that would be for an A team, thus for Lotus it might be only $20m-$25m (£14m).
Thus Pastor brings some £16m extra by bringing in PDVSA (£30m -/- £14m).But what really could tip the scale is the value of the Lotus F1 Team itself. In the end Lotus F1 is a company and its shareholders (Genii Capital) are interested in the value of the company. Simplistically the value is based on a multiple of its profit (EBITDA). For sports clubs this multiple seems to be around 13x.
Thus if Maldonado causes Lotus profit to reduce by £5m this year (in damages, lost price money, etc.) then the value of the Lotus F1 team has reduced by some £65m; thus much more than what PDVSA is bringing them.In short it is hard to say, but it could very well be that Maldonado is costing Lotus more than he is bringing them!
What no one has said yet is the damage to Louts reputation that they need Maldonado money to help pay the bills, and if he left for some reason (which would likely mean that the PDSA money goes too). Would mean that they would be in serious financial trouble and in extreme (but not entirely implausible) circumstances stop racing. That hardly fills potential sponsors with confidence to sign on the dotted line..
I’m guessing Maldonado’s money is keeping Lotus from going under – so if we have to endure this unsympathetic hooligan to keep a team in business, we have to do it!
A little late in this but since no one said the obvious i will have to say it.
Maldonado crashes doesn’t cost as much as you think at all because the team already creates a number of spare parts if anything goes wrong and those are calculated inside the budget from the start.
The team is forced to create all those spare parts because it has to have them because you never know what might happen no matter the driver.
So even if a constant crashing might force the team to create more spare parts that it initially calculated, still not all crashes are extra cost.
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