$200 million budget cap agreed?

[WhiteBlue]

I doubt if the development process would change. You'd just index the process at 6 points instead of 12, or however many. Many small updates would become fewer larger ones, but the work behind them would remain the same.

In fact, getting each iteration right would become more important, since the teams would be stuck with each piece for three or more races. Depending on the relative importance of those pieces, you may well see even more resources diverted that direction.

I do not agree with that view particularly if we talk about less than 6 front wings or aero packages. What needs doing is an analysis and a matrix freeze system that we see in engine development. It works for engines, so why not for aero parts.

I also disagree with the majority view that budget caps would be not policeable. If you make it difficult for the players to cheat and you also have strong anti cheat incentives and punishment you can enforce budget caps in my view.

[mrluke]

F1 would require a complete revolution to be able to abide by a budget cap. TBH I dont think anything short of a collapse would be sufficient to achieve the required changes.

F1 is built and founded on secrecy, politics and bureaucracy. To be able to police a budget cap is going to require sharing of information, transparency and most of all integrity from the teams.

I believe it will happen at some point as the current culture is already looking "old fashioned" and will not be suitable for modern business. Its going to be a hard change though.

[Pingguest]

I also disagree with the majority view that budget caps would be not policeable. If you make it difficult for the players to cheat [...] you can enforce budget caps in my view.

The above sounds like "if you make the budget cap enforceable, it is enforceable". The question, however, is how to make it enforceable.

[turbof1]

Agreed. It's like heroine: governments try to outlaw and put fierce punishments on both using and dealing it.

It's nowadays one of the most profitable business in the world, just because it's illegal. There are countlesss examples where repression does not solve the problem. Also it wouldn't be illegal for teams to circumvent the system. It's the exacr same thing as tax avoidance.

[WhiteBlue]

..It's like heroine: governments try to outlaw and put fierce punishments on both using and dealing it.

It's nowadays one of the most profitable business in the world, just because it's illegal. There are countlesss examples where repression does not solve the problem. Also it wouldn't be illegal for teams to circumvent the system. It's the exacr same thing as tax avoidance.

Apples and bananas, IMHO. Just the fact that Red Bull and Ferrari are against it like the devil against holy water tells us that a budget cap could shake F1 up for the good.

Sure, there will be problems to overcome. But if you do not start you will never arrive. Hence the interested parties make the problem look bigger to profit from their current position of power.

[turbof1]

Sure, there will be problems to overcome. But if you do not start you will never arrive. Hence the interested parties make the problem look bigger to profit from their current position of power.

That's what opposition parties all over the world claim. And when they get into the government nothing changes, even with all their good intentions. And yes of course there's lobbying. From a company's point of view it's better to stop the problem before it starts to be one, before having to circumvent it.

Whiteblue, I know you envision yourself a noble goal, but you can't stop people from trying to bend things to their own advantage. These are the same teams that bend technical rules for years, and their mother companies have even more experience in bending fiscal rules. What makes you believe that the fia can do what governments failed to do for decades?

[Pup]

I doubt if the development process would change. You'd just index the process at 6 points instead of 12, or however many. Many small updates would become fewer larger ones, but the work behind them would remain the same.

I do not agree with that view particularly if we talk about less than 6 front wings or aero packages. What needs doing is an analysis and a matrix freeze system that we see in engine development. It works for engines, so why not for aero parts.

I would answer that if you have to restrict development resources to make the scheme work, then why not just stop there? Simpler to just cut back further on wind tunnel and CFD time and leave it at that. Plus I think it would be impossible to police a scheme where you say only x amount of CFD time can be spent on a wing.

[WhiteBlue]

Actually I don't care much what they decide to do in the end. The fact for me is that F1 needs a working cost limitation system for chassis or aerodynamic developments. If the team,s finally come round to accept that truth they will eventually find a way to set it up and police it.

[FoxHound]

Actually I don't care much what they decide to do in the end. The fact for me is that F1 needs a working cost limitation system for chassis or aerodynamic developments. If the team,s finally come round to accept that truth they will eventually find a way to set it up and police it.

That's like asking Usain Bolt to give his opponents a head start. It simply will not and should not be allowed to happen.
Spending money to make cars go fast is and always has been a part of F1.

I will quote your own footer that makes me chuckle somewhat.

Formula One's fundamental ethos is about success coming to those with the most ingenious engineering and best organization, not to those with the biggest budget. (Dave Richards)

Now I have time for Dave Richards as a motorsport man, I really do. But there is good reason why he didn't make it as many think he should have in F1. I say to him....
The ethos of F1 is the most ingenuous engineering and best organisation COMES from those with the biggest budgets. Toyota the exception here due to their incessant staff changes and the mire that ensues from such action.

Ferrari McLaren and Red Bull have dominated the last 17 years with only Brawn and Renault showing them up.
And Brawn had a car that had 250 million thrown at it in its development cycle courtesy of Honda.
Renault where a factory team with with a lower headline budget than Macca and Ferrari, but still not by any means paupers in the spending race.

When you start imposing artificial financial restrictions on a market, then things will eventually capitulate. It's only a matter of time.
Budget caps do nothing to solve the spending problem WB. Do you at least accept the possibilty of that?

[WhiteBlue]

We can obviously disagree about this issue, and I will. Those with some sense agree at least that F1 cannot continue to operate the way it did in the past. We have not seen one successful F1 team investment in the last five years except those three that were triggered by Max Mosley's ill fated budget cap scheme. We only have seen teams fail and we will see more teams fail unless something drastic happens.

[FoxHound]

We can obviously disagree about this issue, and I will. Those with some sense agree at least that F1 cannot continue to operate the way it did.

So those that disagree with your view have no sense?
Why have a regulation you could not police? That is nonsense.
Less regulation better applied is sense WB.

[bhall]

While I think most people tend to agree that F1's economic model is flawed and in need of an overhaul, the nature of the world in which we live means a budget cap simply cannot be considered a viable solution if the sport is genuinely determined to address the problem. There's no way around that sober reality, because the cracks inherent to such a system are as plentiful as they are profound.

I think proposing a budget cap is tantamount to suggesting that the Titanic be raised with a teacup. It's a fantasy.

That the idea is repeatedly brought forth by people within the sport who I think ought to know better leads me to believe F1 is, in fact, not at all serious about controlling costs. And why should they be? They know the only bulletproof solution is to standardize components across the board, but that's not what F1 is about. As such, teams will continue to seek a competitive edge by any means necessary wherever there's any degree of freedom. It's the very essence of the job.

[Pup]

We have not seen one successful F1 team investment in the last five years except those three that were triggered by Max Mosley's ill fated budget cap scheme. We only have seen teams fail and we will see more teams fail unless something drastic happens.

But a $200M cost cap won't make Marussia or Caterham more competitive or viable; nor will it attract a new team by making the sport affordable. Make it a $75M cap and then maybe, assuming you could make the cap work. At $200M, this cap is designed to maintain some sense of competition among the big boys. Apart from a possible secondary effect of making F1 more enjoyable/marketable, it would have no effect further down the field.

[JRalph]

As I am new to F1, only started watching this past year, please forgive me for my naivety on the inner workings of F1 teams, but assuming that a budget cap is needed to control costs and make it more competitive for smaller teams, a more objective measure of "cost" is needed than a team's budget which can easily be fudged.

My suggestion would be to create a soft cap on the number of hours that a team can test on the track, run in the wind tunnel or spend on their simulators. Teams would then be allowed to test on track, in the tunnel or virtually to their heart's content but for every hour above the cap that they test they would have to pay a set price into a pool. At the end of the year that pool of money would then be divided amongst the lower spending teams based on some criteria to be determined by people smarter than I.

So for example lets say there is a cap of 400 hours and any hour above that cost $50,000/hr. Then if a team like Red Bull had spent 600 hours testing during the year, they would have to pay $10,000,000 into this pool. At the end of the year that pool would then be divvied up based on the number of hours each team spent testing, with the team testing the least getting the most of that money.

Obviously those exact numbers would have to be fine tuned to make sure that it was actually helping to control costs as well as make it beneficial for the lower tiered teams, but at the same time if a team wanted to make that expenditure it can do so.

[spin1/2]

But a $200M cost cap won't make Marussia or Caterham more competitive or viable; nor will it attract a new team by making the sport affordable. Make it a $75M cap and then maybe, assuming you could make the cap work. At $200M, this cap is designed to maintain some sense of competition among the big boys. Apart from a possible secondary effect of making F1 more enjoyable/marketable, it would have no effect further down the field.

$200M is the first step towards a budget cap. This amount can gradually be decreased over the years.

A few years ago (~ 2010), Bernie suggested a (40 M pound) = $65M cap. It was a drastic change when the top teams were spending upwards of $250. It was immediately vetoed.