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Old 19 Nov 2013, 02:05 (Ref:3333393)   #1
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F1 Finance - What is going on?

Has anyone got any links to a definitive article on what is going on in F1 finance?

"According to Bild newspaper, however, Ecclestone might actually be Fabiana’s ‘bad boy’ because Formula 1 teams are angry with him about the unfair distribution of revenue under the new financial arrangements.
Red Bull, for example, is getting an ‘appearance fee’ of $72 million this year, while Ferrari gets a whopping $99 million, on top of lucrative Concorde Agreement prize money.
Struggling Lotus, however – although with only a few less points than Ferrari in 2013 – gets no such appearance bonus, according to Auto Motor und Sport"

from

http://grandprix247.com/2013/11/16/e...like-bad-boys/

Ferrari have the best infrastructure of any team, and then they bank $99M before anything else that is coming their way!


... and we wonder why the smaller teams can never get on an equal footing with the big ones!
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Old 19 Nov 2013, 02:10 (Ref:3333395)   #2
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It does sort of explain how Lotus, besides several Championships since 1995, running up front with numerous podiums and two wins over the past two seasons still stuggles financially when compared to Ferrari and RBR. I'd be angry too, it seems like the Enstone team will always be the underdog team going against the current.

Being the underdogs is one of the reasons I'm a fan of them, and not so much of RBR.
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Old 19 Nov 2013, 03:08 (Ref:3333421)   #3
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This is why there will never ever be a budget cap. The series epitomizes all that is wrong with big money in sport.
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Old 19 Nov 2013, 03:38 (Ref:3333435)   #4
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It does sort of explain how Lotus, besides several Championships since 1995, running up front with numerous podiums and two wins over the past two seasons still stuggles financially when compared to Ferrari and RBR. I'd be angry too, it seems like the Enstone team will always be the underdog team going against the current.

Being the underdogs is one of the reasons I'm a fan of them, and not so much of RBR.
How many ownership changes has 'Lotus' actually had? (Renault, Benetton, Toleman...) In their own name, in current times, in current ownership, Lotus has won races but not championships.
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Old 19 Nov 2013, 13:03 (Ref:3333614)   #5
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How many ownership changes has 'Lotus' actually had? (Renault, Benetton, Toleman...) In their own name, in current times, in current ownership, Lotus has won races but not championships.
Sorry, I was referring to the Enstone team. I just see Lotus as the current name on the car.
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Old 19 Nov 2013, 03:37 (Ref:3333434)   #6
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Presumably WilliamsF1 is also a beneficiary of this appearance money... it is not likely they could run with so few commercial partners on the flanks...
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Old 19 Nov 2013, 05:22 (Ref:3333455)   #7
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Ecclestone is basically bribing the big teams to agree to sign whatever agreement he needs. This is of course unfair. The only fair way is to distribute the money according to championship standings.
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Old 19 Nov 2013, 05:40 (Ref:3333457)   #8
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Ecclestone is basically bribing the big teams to agree to sign whatever agreement he needs. This is of course unfair. The only fair way is to distribute the money according to championship standings.
Is it more interesting for the punters watching the championship to have Ferrari involved, or a prodrive team sourcing last year's McLaren castoffs?
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Old 19 Nov 2013, 09:35 (Ref:3333510)   #9
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This has been going on years. And yeah, it is ludicrous.

But Bernie is so tongue in cheek, great wind-up etc... Wonderful for the sport. Err...
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Old 19 Nov 2013, 09:39 (Ref:3333514)   #10
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To be perfectly honest F1 does pretty well in comparison with football.

How on earth that sport keeps its head afloat I have no idea, it surely can not carry on this endless stream of stupid wages and ticket prices.

F1 at least managed to stay a little bit above board in comparison. If you read Bernies book, you will sort of see the issue with Ferrari, it is as much about loyalty as anything else.

Although in this modern age, I see no reason why, but then again, as a fan, wouldn't you rather have Ferrari than a company who spends more simply to advertise a thing that helps to give everyone diabetes?

I know where my dollar would be going sorry
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Old 19 Nov 2013, 15:47 (Ref:3333677)   #11
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Although in this modern age, I see no reason why, but then again, as a fan, wouldn't you rather have Ferrari than a company who spends more simply to advertise a thing that helps to give everyone diabetes?

I know where my dollar would be going sorry
for sure a team that subliminally advertises a thing that helps to give everyone cancer is a better trade off!

seriously thought the part that frustrates me is not that Ferrari get extra money its that despite the extra money they threw in the towel so early this year. no attempt to push til the end, no desire to steal a final win just to save face but rather just a couple of tirades against their driver for suggesting that the team do more.

and whats particularly frustrating is that we understand all too well the financial realities so we act as apologists for that team by rationalizing why its important to know when to quit and start focusing on next year.

this year wasnt boring because one team dominated. it was boring because all the other teams decided that trying this year was not in their best interests.
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Old 21 Nov 2013, 00:19 (Ref:3334561)   #12
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this year wasnt boring because one team dominated. it was boring because all the other teams decided that trying this year was not in their best interests.

Letting this year go early is a high risk strategy if you are also rubbish next year! All your sponsors start heading for the door!
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Old 19 Nov 2013, 09:55 (Ref:3333520)   #13
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Football does bring in a lot of money though. Some clubs overspend, but they are usually found out and crash through the divisions.

There are of course sugar daddy clubs who spend way more than the club earns, but it is the owners money being spent so you can't really say much other than it destroys the competition.

Also television and prize money is distributed on a fairly reasonable sliding scale that rewards league standing.

F1 makes a little money. This all goes to Bernie who gives it to favourites.
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Old 19 Nov 2013, 22:30 (Ref:3333930)   #14
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There would appear to be a number of reasons why there are a number of teams are struggling and others are getting richer.
In my view it goes back to when FOCA threatened to start a break away series a few years ago and Max brought in the 'budget cap' teams (now Caterham & Marussia). If the breakaway had happened Bernie and CVC would have had nothing to promote and sell to TV companies to make their billions.

With the new Concorde agreement Bernie wanted to make sure he had the important teams namely Ferrari, McLaren and his mates at Red Bull/Torro Rosso. To do this he offered them good financial deals to sign up. He then included Williams and Mercedes after much haggleing. The rest were left with take it or leave it deals and it appeared as though he wanted to get rid of Marussia by not giving them anything. However the midfield teams get a lot less than the top teams. How the non favoured teams are going to survive long term is anybody's guess because trying to raise money inthe unequal struggle will become extremely difficult for them.

Bernie was making sure he had all the important teams covered so that he andd CVC could continue with their gravey train for another few years. What will happen when Bernie leaves the scene is anybody's guess but i suspect we will have a major civil war.

Last edited by wolfhound; 19 Nov 2013 at 22:51.
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Old 20 Nov 2013, 10:56 (Ref:3334176)   #15
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How the non favoured teams are going to survive long term is anybody's guess because trying to raise money inthe unequal struggle will become extremely difficult for them.

Bernie was making sure he had all the important teams covered so that he andd CVC could continue with their gravey train for another few years. What will happen when Bernie leaves the scene is anybody's guess but i suspect we will have a major civil war.
When you're 83 years old, there is no such thing as long term, just the here and now.

+1 on the civil war - probably end up being in the courts for years.
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Old 21 Nov 2013, 00:15 (Ref:3334559)   #16
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When you're 83 years old, there is no such thing as long term, just the here and now.

+1 on the civil war - probably end up being in the courts for years.
If all the parties involved have half a brain between them they will all agree to a mediated settlement and leave the legal system well alone!
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Old 6 Dec 2013, 21:33 (Ref:3341008)   #17
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So we know what the issues are but what do people think the future holds?

Are we going to have a disaster ( lots of teams going under) which forces a change?


Is it too late and could that disaster kill the sport?


Does F1 in its present form have any future?


And what about "The pinnacle of Motor Sport". If this "F1" does collapase what next? A new series forgetting all the baggage?
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Old 6 Dec 2013, 22:16 (Ref:3341041)   #18
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So we know what the issues are but what do people think the future holds?

Are we going to have a disaster ( lots of teams going under) which forces a change?


Is it too late and could that disaster kill the sport?


Does F1 in its present form have any future?


And what about "The pinnacle of Motor Sport". If this "F1" does collapase what next? A new series forgetting all the baggage?
I would imagine 3 or 4 teams going under would cause problems but it does depend on who are the teams that dissapear. If 2 or 3 of the midfield outfits were to go then I suspect that might get all in involved to do something but it will require a shock to the system for anything to happen.
It depends on all involved to pull in the same direction without large quatities of money being taken out of the sport. It will also require everone involved to forget their self interest and work together for the good of the sport.
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Old 7 Jan 2014, 19:34 (Ref:3351339)   #19
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All the right noises are being made, by all the right people. I just pray that this comes to something where the sport is in a much more stable place. Even with so much money being pumped out by CVC, at least the teams will be able to survive. We will still argue what happens is unjust but at least the issue this unjust causes may be partly resolved.
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Old 22 Nov 2013, 20:47 (Ref:3335361)   #20
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There have been some interesting rumours on the F1 structure front. In an Autosport article there is a suggestion that we may have 8 teams with 3 cars each in the near future. This idea is being driven by Bernie & CVC to reduce the cost to them of F1 and hence line their pockets even further.

The idea came out of the failure of the customer car concept which was not acceptable to the F1 teams.

The new idea would see both Caterham & Marussia being merged / taken over by other teams. Toro Rosso would be absorbed into Red Bull.
The two smaller teams are said to be already in talks with other teams and an anouncement might come shortly.

The majority of teams are said to be in favour of this plan. There are a number of ideas that the third car could run in different colours and or to be driven by a young driver.

It will be interesting to see if any of this plan happens. It will be toughest for the midfield teams left to finance the running of an extra car as it could be very difficult for them to score points under this system.

http://plus.autosport.com/premium/fe...-on-f1-agenda/
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Old 23 Nov 2013, 01:58 (Ref:3335473)   #21
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There have been some interesting rumours on the F1 structure front. In an Autosport article there is a suggestion that we may have 8 teams with 3 cars each in the near future. This idea is being driven by Bernie & CVC to reduce the cost to them of F1 and hence line their pockets even further.

The idea came out of the failure of the customer car concept which was not acceptable to the F1 teams.

The new idea would see both Caterham & Marussia being merged / taken over by other teams. Toro Rosso would be absorbed into Red Bull.
The two smaller teams are said to be already in talks with other teams and an anouncement might come shortly.

The majority of teams are said to be in favour of this plan. There are a number of ideas that the third car could run in different colours and or to be driven by a young driver.

It will be interesting to see if any of this plan happens. It will be toughest for the midfield teams left to finance the running of an extra car as it could be very difficult for them to score points under this system.

http://plus.autosport.com/premium/fe...-on-f1-agenda/
It would appear there is just no end to some people's greed!

Killing the goose that lays the golden eggs?
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Old 23 Nov 2013, 09:48 (Ref:3335600)   #22
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It would appear there is just no end to some people's greed!

Killing the goose that lays the golden eggs?
To the best of my knowledge most series organisers charge a commission of about 10% but CVC want 100% if they could get away with it.

They made over £550 million in 2012 from F1 and have all sorts of side deals with suppliers that it is difficult to workout exactly how much more. If £450 of that was shared between the 7 teams outside of the 4 big teams it would keep them in a nice position financially.

However must not forget the GP organisers who have to get about £300 from every spectator to make ends meet.
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Old 24 Nov 2013, 13:30 (Ref:3336001)   #23
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To the best of my knowledge most series organisers charge a commission of about 10% but CVC want 100% if they could get away with it.

They made over £550 million in 2012 from F1 and have all sorts of side deals with suppliers that it is difficult to workout exactly how much more. If £450 of that was shared between the 7 teams outside of the 4 big teams it would keep them in a nice position financially.

However must not forget the GP organisers who have to get about £300 from every spectator to make ends meet.
As I've stated in another thread. It's not that the teams don't have enough prize money to survive, it's because some of the teams insist that it's shared out unfairly.

http://www.autoweek.com/article/20131006/f1/131009861
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Old 24 Nov 2013, 13:49 (Ref:3336005)   #24
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If £450[m] of that was shared between the 7 teams outside of the 4 big teams it would keep them in a nice position financially.
You would hope so!

That amount ought to keep all of them going!

And many high profile companies would consider a profit of £550m to be a poor return for such a high profile company.
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Old 23 Nov 2013, 20:34 (Ref:3335781)   #25
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If you think that Bernie is the boss in F1 well he is but he has to answer to CVC and the man in control of that is Donald MacKenzie. He was in court recently to outline his side in the Bernie Eccelstone court case. He is not seen very often in the F1 paddock but what ha said can be found in the link below

http://www.bbc.co.uk/sport/0/formula1/25020379
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