Full List of cost cuts for 2009+

[mx_tifoso]

Does no refuelling mean drivers have to save fuel? So accelerate hard then change to a very tall top gear and run at 5000rpm to save fuel.

Fuel systems will change of course, and the powertrains will be more efficient by then too. And that takes care of that...

[meves]

I suppose most of the rest has been slowly leaked out by the teams and FIA and something had to be done. Moving testing to races weekends, no spotters, shared weather, standard brakes, etc. But it has alway been about technical innovation. I'm sure the last "Market Research" that was done had Techincal Innovation very near to the top. I guess the FIA feel that with some scare tactics at the time when the worlds markets are looking rosy is the best way to get things changed.

Basically it's almost a customer car now, Frank Williams will be thrilled!

No chassis research needed as anything that gives a big advantage will be shared
Small wind tunnels which can easily be hired
Cheap engines
Restricted CFD
Factory checks to get rid of anything interesting.

I wonder if Adrian Newey and his Americas Cup dream will happen now and some of the research will magically bleed across into F1 without the audits and the nanny F1 state.

[meves]

Other potential FIAs cost saving schemes;

F1 Partys
All drinks to be watered down with at least a mixer alcohol ration of 10 to 1. This will save on headache tablets and bottled water and the plastic used on the bottles curing hangovers.

Pit Girls
To not be taller than 170cm and not to have more than 1sq metre of material used in their costume. Lycra, Cotton mix only no advance materials, which will give a significant material saving over the year.

Champagne Celebration
A tender will be released for a low cost sparkling wine, bottle size not to exceed 0.5l.

F1 Hospitality Units will be a standard size
I think that portaloo size should do!

[DaveKillens]

And move Max's location from Monaco to Amsterdam. That way, he doesn't feel the need to travel to London to spend 75,000 on five hookers when he can get them cheap in Amsterdam.

[xpensive]

And put a budget-cap on outrageous divorce-spendings!

[mx_tifoso]

Or at least a standard supplier of hookers/escorts.

Sorry I couldn't resist.

[donskar]

I hope this fits under "cost cuts" -- at least tangentially:

Subaru and Suzuki have pulled out of WRC, And Citroen/Peugot have formally stated they ar NOT going to F1. It is hard to imagine many manufacturers so flush that F1 would be attractive. But I'd like to think that it is NOT the COST of F1, but the return on investment that is the key.

Cutting costs is definitely worthwhile, even essential. But Max and Bernie (Spanky and his Gang) COULD ALSO take a different, complementary approach -- helping the sponsors and manufacturers get more for their money - better ROI for their investment. Sponsors will continue to spend money; F1 must convince them that F1 is a cost-effective way to spend that money.

In no particular order and little deep thinking:

Since testing is banned except race weekends, could it be posible to make Thur, Fri, and Sat more attractive and appealing? Can large numbers of spectators be lured into the seats - perhaps with free admission?

Allow the spectators into the pits -- cheaply or for free -- at least on the first day of the weekend.

FORCE (if necessary) the drivers to mingle among the little people, press the proletariat flesh, BE HUMAN.

Increase pre-race activities and add significant pre-F1 races. BMW ProCar was great (remember?), maybe revive the GP Masters series.

Do entry and exit surveys, measuring spectator awareness of a sponsor before and after the race. (Huh? Example: At Digital Equipment Corp I managed a flashy web site commemorating the 100th running of the Boston Marathon. We placated the big wigs by running a before-and-after survey. We found that respect for and awareness of DEC's technical prowess went up several %. This is the kind of thing that marketers eat up -- and pay for -- measurable results.)

I'm sure we can come up with more and better ideas, but the point is to give the manufacturers/sponsors more visibility to more people for a longer time.

[meves]

I completely agree that corporates coming in sponsoring teams need to see value. Maybe the main team sponsors should be able to nominate a race per season and get on track advertising at that race as well as on the car.

I also think that Mr Eccleston needs to look firmly in his own back yard and charge race circuits realistic amounts of money. He will lose circuits and the "new" territories aren't flush with cash now either. He also needs to give more back to the teams which he does occasionally under great duress. I wish the FIA would put some stipulations in their contact with Eccelston and Co instead of just off loading all the commercial rights onto company and washing their hands of it.

Having more of a show around the weekend would be great with more regional races, which would showcase talent from that region. It's a difficult business to get into and anything that will help I'm sure would be appreciated by the up coming drivers. I will be interested to see if ticket sales drop off this year £200 for a weekend ticket is expensive, especially with accomodation, food and travel needed.

[WhiteBlue]

The biggest drain of money is without any doubt the money Ecclestone and his employers take out of the sport to pay the debt they took for their own fortunes. Ecclestone took out 3-4 billion $ by selling FOM shares and most of that money wasn't there at the time when he transferred it to his personal account. The company was re sold several times and every time the burden of debt was much increased.

The teams have pushed Ecclestone from 70% of revenues back to 50%. But that was preceded by various deals that allowed Bernie to take that huge share and extended the contract to the year 2112. The responsibility for this lies to a big part with Max Mosley who has let it happen and helped him with the robbery.

The decent thing to do would be siding with the teams and get them out of the 100 year contract. And the FiA should use some of the money that is wasted on the Banks to help good feeder series and grass root motor sport. If there ever was a time to rebell against Bernie it is now. Now the teams are confident with their FOTA and Max wants to go out of F1 with having accomplished something.

[xpensive]

I consider the only sensible thing would be for FOTA, with their newly discovered unity, to seize the opportunity to form their own series, with or without Mosley. Simply ditch the pofiteers.

When you think about it, Mercedes, BMW and Toyota being shafted by an ex. used-car salesman and his masochist cohort, the only thing missing to the picture is Rowan Atkinson.

[Conceptual]

How about a completely different approach?

What if all of the cars were painted that silly bright green that they use on the "Green Screen" cinema sets, and actually "skin" the cars with regional logo's for regional feeds?

I know that the immediate answer will be a resounding "NO!" but if you think about it, the cost of sponsorship would then go WAY DOWN, thus enticing more sponsors to enter.

I know that the processing power is there to do this seamlessly, but it would be difficult for the teams to be distinct on track.

Maybe just the rear wing and endplates? I know that it doesnt have to be green since the computers can fix it in post production, but I think this would cut costs by bringing in more money for the teams.

Regional feeds with regional ads that change (TV only).

Comments?

[WhiteBlue]

I wonder how the agreed cost cuts in R&D will be policed.

The wind tunnel isn't such a big deal. You can use smaller than full scale models in a 100% tunnel and you can shut down the tunnel after 8 hours of working. You can sell your second tunnel.

But how about the 20 Teraflops limit for CFD? I believe that BMW Sauber have now Albert III which posseses 70 Teraflops. Are they going to sell this computer and buy one with the right capacity? Or do they have to disable parts of it?

[donskar]

How about a completely different approach?

What if all of the cars were painted that silly bright green that they use on the "Green Screen" cinema sets, and actually "skin" the cars with regional logo's for regional feeds?

I know that the immediate answer will be a resounding "NO!" but if you think about it, the cost of sponsorship would then go WAY DOWN, thus enticing more sponsors to enter.

I know that the processing power is there to do this seamlessly, but it would be difficult for the teams to be distinct on track.

Maybe just the rear wing and endplates? I know that it doesnt have to be green since the computers can fix it in post production, but I think this would cut costs by bringing in more money for the teams.

Regional feeds with regional ads that change (TV only).

Comments?

I don't know about implementation of the green screen, but I think your kind of thinking is what's needed. It sounds do-able -- and a smarter investment for the sport's immediate survival than KERs. (KERs is important, but less so than the loss of more teams!)

One thing that is currently being done at American sporting events: the signage (bollards?) around the stadium can "rotate" electronically, so that one space can display multiple adverts.

Another idea that should not be too difficult: sell re-broadcast rights to major, mainstream TV networks (at least in the USA). Certainly F1 is of minimal value to US-centric advertisers because the race is on VERY early Sunday morning or VERY late Saturday night, then the re-broadcast is Sunday late morning or early afternoon (not prime viewing times) AND nearly all the races are broadcast only on SPEED TV - a noble effort, but a rather small fish in the TV pond.

I have to believe (hopeless optimist) that Spanky and Hugestones could get out and drum up more sponsorship and more interest in F1 among multi-nationals. When it comes to wining and dining the big shots, Spanky could certainly offer some unique entertainment!

Seriously, even Toyota is tightening its belt (even canceled a Prius plant here in the US), so things COULD get a lot worse very quickly. Costs must be cut, but all other avenues must be explored.

[WhiteBlue]

Before FOM embraces central advertising by blue screen technology they should get their HDTV technology sorted out. I also think that blue screen would be ok for the track advertising. On car advertisements are marketed by the teams. To centralise that in FOM hands would focus more marketing power where it can be abused.

[donskar]

And here we go again:

Cost cutting is necessary if F1 is to survive. That is a given. But the thought that Spanky is driving it is scary. The depths of his ignorance are suggested from a statement from the letter below:

the fact of having recently invested in an expensive facility is not an argument for retaining it. That money has been spent. It's gone.

That investment was made with the expectation of returns on the investment. That means direct returns such as improved performance, and indirect returns such as the ability to recruit high quality personnel -- and SPONSORS. What is "gone" is the likelihood of any return on the investment. Another example of "cost cutting" having the reverse impact from what was intended.

Mr Luca di Montezemolo, Chairman

FOTA

FORMULA ONE TEAMS ASSOCN

5 January 2009

Dear Luca

COST CUTTING

Following Charlie's email of 3 January, I feel it may be useful to set out the current position as we see it.

A few general points

First, even before the current crisis, Formula One was not viable. Costs have been so high that we have had vacancies in the Championship for some time. Secondly, it is impossible to cut costs substantially without significant change. Inevitably, cherished projects, facilities and sadly even people have to go. Thirdly, the fact of having recently invested in an expensive facility is not an argument for retaining it. That money has been spent. It's gone. What we have to avoid is forcing others to spend the same money in order to keep up. Fourthly, there is no rational argument to support the continued use in Formula One of expensive technologies which have no relevance outside the sport and are unknown (and thus of no interest) to the general public.

SPECIFICS

2009

The changes to the 2009 Regulations agreed at the December 10 meeting will help a lot. We need detailed proposals on some aspects, particularly the 8 hour/5 day restriction on wind tunnel use (which we understand was agreed among the teams) if we are to enforce this as a regulation, but much is already in place.

We are ready to agree further cost-saving measures for 2009 if these have the agreement of all the teams.

2010

The really big changes come in 2010.

Engine

- The rev limit will be reduced to 17,000 for 2010 and thereafter;
- retuning will be limited to, at most, trumpets and injectors (position only), except that Cosworth, having missed out on the last retune, will be allowed to make general changes within a limited budget;
- engines remain completely frozen until 2013, as already agreed;
- testing will be limited to 15,000km per year, Friday testing included.

On this basis, Cosworth will be able to supply competitive engines from 2010 for well under €5m per season per team, including all on-track support, provided they have firm orders to supply at least three teams within the next week or two;

The present regulations will remain in force, so there will be no interference with any existing arrangement for the supply of engines. Furthermore, the reduction to 17,000 rpm will allow additional cost savings for current engine suppliers.

Transmission

We intend to make it a condition of entry to the 2010 Championship that a team has made an arrangement with XR for the supply of the standard gearbox in accordance with XR's tender. We appreciate that some teams would like to continue with their current arrangements and/or use standard internals, but the fully standard gearbox is an obvious way to save very significant sums without affecting any useful aspect of Formula One. In order to eliminate the difficulties of the interaction of the casing with the underbody, we will also require a standard underbody. Again, this will have no impact on the spectacle but will save even more money and eliminate certain scrutineering problems.

Chassis

We will shortly produce a list of chassis parts and systems which, from 2010 onwards, will be the only elements of the chassis which can be developed. All remaining chassis elements will be either standard or frozen. We wish to develop this list in consultation with FOTA but it must be understood that it will involve a radical curtailment of R&D in respect of the chassis and hence a very significant reduction in costs. If carefully thought through, it should also reduce the need for the use of wind tunnels, CFD and simulators.

Race Weekend

We should like FOTA to make proposals to reduce further the costs of the race weekend, always on the basis that priority should be given to cost savings in areas which are invisible to the public and have no safety implications.

KERS

No team is obliged to fit KERS. It is also open to the teams to agree on a standard system or, indeed, to agree not to fit it at all. We are increasingly of the view that the use of chemical storage (in particular batteries) should be prohibited in Formula One owing to the unsuitability of the batteries currently available. There are at least two mechanical or electro-mechanical systems under development for Formula One and there may be others as well as hydraulic systems. Formula One would benefit from systems with more capacity than the present 400KJ, 60KW, (for example maxima of: 2MJ stored, 150KW in, 100KW out) but still very small and very light, as is essential in Formula One. These figures are theoretically possible with mechanical devices, but not feasible in the foreseeable future using batteries and/or capacitors. Such non-chemical devices, if successfully developed, would have a very significant impact on road transport and other applications.

This is a subject we should like to explore in depth with FOTA. In particular we should like to examine how Formula One's outstanding engineering capacity could be used to develop KERS without incurring significant costs for the teams.

Tyres

Apparently a lot of money is currently being spent on achieving a weight distribution which gets the best possible performance from current tyre widths. We should like to discuss with FOTA a possible change in the front-to-rear width ratio with a view to eliminating this problem. At the same time we should like to examine with Bridgestone and FOTA the possibility of introducing compounds which will not produce "marbles".

Budget Capping

We understand that this is once again being discussed within FOTA. The idea that each team should have the same amount of money, so that success is simply a function of intellectual ability, has great appeal. If properly enforced, it would be a very fair system. Indeed one view is that having much more money than a rival team is just as unfair as having a bigger engine. We should like to discuss this further with FOTA. It may be that in present circumstances, a voluntary cap would work because no manufacturer whose board has signed off the agreed amount would be likely to allow secret additional expenditure, while independent teams would probably not have access to the necessary cash.

The "Show"

The main complaint from race fans is the lack of overtaking and wheel-to-wheel racing. Changes to the aerodynamics rules have been proposed by a group of top experts from the teams and will take effect in 2009. It remains to be seen whether these plus an extra 80 bhp from KERS will help overtaking. There are also proposals for changes to the sporting regulations such as wholly or partially reversed grids, allocating leading grid places by lot, giving the World Championship to the driver with most wins and so on. Arguably, however, none of these deals with the problem that once the faster car gets past, it tends to drive away. So none of these proposals is conducive to close, wheel-to-wheel racing.

We intend to seek FOTA's help to investigate the use of moveable aerodynamic devices. If sufficiently radical, these could give a car following another car a performance advantage by virtue of being behind. In a primitive way, this was the case in the 1960s, when a car would get a "tow" and lose lift and thus be faster in the wake of another car. The result was wheel-to-wheel racing at the so-called slip-streaming circuits, for example pre-chicane Monza. Using modern technology, moveable aero devices could be used to give a car more downforce and less drag whenever it was in turbulent air. This would produce wheel-to-wheel racing on all types of circuit. It would, however, require significant (possibly automatic) moveable aero devices.

The Future

As already mentioned, the financial barriers to entry were already too high before the current world financial crisis. We had a Championship dependent on the willingness of world's car industry to continue spending vast sums on Formula One racing and the few remaining independent teams (with one exception) entirely reliant on the generosity of their billionaire owners. In current circumstances, it would be crazy to assume this can continue. Costs must be reduced to a point where a well-run independent team can operate profitably with just the FOM money and very moderate sponsorship. This is the only way to safeguard the Championship and allow new teams to enter to fill the gaps as well as replace those leaving.

The FIA itself would not be financially disadvantaged by a collapse of Formula One, but it would suffer in other ways. And, in any event, we believe we have a duty to do whatever is necessary to preserve the Championship for the competitors, the commercial rights holder and motor sport generally. We are therefore prepared to act radically. We hope that, notwithstanding the changes which must now be made, all teams which are still in business in 2010 will enter. But as already stated, we will be ready to recognise an independent series should some teams prefer to go their own way.

We hope for FOTA's support in the actions we take and for your unstinted help in reaching the decisions which have yet to be made.

With best wishes

Yours sincerely

Max Mosley

cc: All Formula One Team Principals