Infiniti Red Bull Racing 2015

[turbof1]

Exactly, Phil. Designing and building engines is not part of a Energy Drinks company's core business. You cannot built engines in a factory made to put caffeïne and syrup in a can. It would require an enormous investment in a new factory, plus resources not-directly buyable by money (as you said: know-how and time). For all of that, Red Bull is not going to get anything extra returned in terms of revenue. The ROI is clear as day: none existent.

[FoxHound]

I'm sorry but I cannot accept that building engines is not part of an energy drinks companies core business, if building F1 chassis and aero dynamics with lead designer Adrian Newey(best in field) along with CFD etc is somehow is part of their core business.

That's pure hypocrisy

[FW17]

To Red Bull cost of advertising and marketing their brand though F1 has gone up.

For Red Bull their mission in F1 is maximum brand visibility and the best way for that is to be winning. If engines are not available for them they just have to make one themselves. F1 engines just as an F1 chassis has little use outside of F1. But what they crate will all be towards visibility of their brand.

What is sellable will be sold to recover the costs such as badging of the engine and engine tech to other motorsports and road car industry.

It depends weather the top bosses of Red Bull see feasibility for the same; in terms of performance gains in the long term, as as at the moment this is heavily guarded by development limitations. The current top teams who have rejected Red Bulls engine requests will also prevent Red Bull from developing their own engine.

With regard to buying resources; I think everything can be bought. As with F1 staff engine staff also can be assembled to the similar scale with unlimited money. Red Bull Tech already has sufficient experience in MGU, CU and ES. Ilmore has enough experience to put an engine together and Red Bull has enough money to fund various parallel engine programs.

Currently they are spending by estimates between $450 - 700 million this could just go up to $750 - 1000 million a year. Question is if there is sufficient return to the brand to spend $750 - 1000 million a year (not counting the income). And a minimum waiting period of 2 years before the engine is fully developed to be a winning engine.

[turbof1]

I'm sorry but I cannot accept that building engines is not part of an energy drinks companies core business, if building F1 chassis and aero dynamics with lead designer Adrian Newey(best in field) along with CFD etc is somehow is part of their core business.

That's pure hypocrisy

It's not, but I do understand where you are coming from. That sentiment atleast clears up your point of view. You have to understand that Red Bull more or less is a team that entered the sport under the V8 engine freeze. Hence there was never a need in the first place to built your own engine: the manufacturers would have more or less the same engine. So it would make perfectly sense to just get supplied.

What that in mind, they built a factory with only developing and building the chassis/aero in mind. That alone has been a huge investment and huge yearly cost, but for them that worked out concerning ROI: after all they were winning races and championships, which was marketing-wise a huge benefit. Remember: F1 as a business is not part of their core business. It's part of their marketing activities, and with all marketing activities, the goal is to gain more revenue then you loose with the extra cost. The ROI was in that frozen V8 format just that: profitable.

But now in 2014, the way you are going to be competitive in F1 has changed. No more engine/PU freeze means manufacturers are back in the position to purposely deliver what they want to their customers. Meaning that the only way a top team is going to be competing for race wins is by building their own engines or attracting a manufacturer that only wants to exclusively work together with 1 team (yes, I very much underline that fact). However, say they'd do that and built their own PUs and start winning races again. Are they going to benefit from it? No, they doubled their costs just to get back in the previous situation of marketing value. The marketing value will not rise due that PU, development costs will not be able to spread over any automotive business (they have none) and there will be no extra revenue generated to justify the increase in costs. They are not going to stay in F1 under those terms.

So in short: Red Bull Racing was built with the costs in mind of the previous generation where PUs were frozen. This does not work anymore due the extra power now given to the manufacturer by the lift of development freeze. That's not hypocrity, that's the unfortunate realisation that the previous format they have succesfully and profitably built their team on, is no longer in effect and that the new format no longer is profitable for them to run at the top .

In my eyes Red Bull has 2 realistic options:
-Accept they'll be supplied inferior PUs, reduce their costs by moving or firing staff, and generally accept for a midfielder position.
-Quit F1 and move on to somewhere else.

@WilliamsF1: I think you are grossly underestimating the investment costs and time table to get to a competitive state with a PU. However, you got the core question asked: "Question is if there is sufficient return.". In my eyes no: 4 years at a minimum of factory set up costs (it's one thing to built a only half-functioning KERS, but to built it competitive along with an ICE and TC is wholy different level.) and development costs, which are sunk costs without the ability to regain those in any possible way during that 4 year period, plus afterwards only the ability to restore marketing value back to 2010-2013 levels, is not anything near a profitable ROI. You are atleast doubling and in my opinion tripling the costs.

[FW17]

You have to understand that Red Bull more or less is a team that entered the sport under the V8 engine freeze. Hence there was never a need in the first place to built your own engine: the manufacturers would have more or less the same engine. So it would make perfectly sense to just get supplied.

Red Bull entered in 2005 in V10 era. Not sure if Freeze was being talked about in the beginning of 2005; I think it was thought about in the beginning of 2006.

Underestimating the time line for sure 2 year or 4 years but there is a period (long) of time required, but what ever it is the current system of development restrictions do not allow for quick improvements.

Let us not talk about money to Red Bull; if they feel spending will yield results then they will spend. This is the reason why they are splitting with Renault as they were non committal on increased spending to catchup.

I don't see them building an engine but the reason for it is not Money.

[turbof1]

You have to understand that Red Bull more or less is a team that entered the sport under the V8 engine freeze. Hence there was never a need in the first place to built your own engine: the manufacturers would have more or less the same engine. So it would make perfectly sense to just get supplied.

Red Bull entered in 2005 in V10 era. Not sure if Freeze was being talked about in the beginning of 2005; I think it was thought about in the beginning of 2006.

Underestimating the time line for sure 2 year or 4 years but there is a period (long) of time required, but what ever it is the current system of development restrictions do not allow for quick improvements.
Let us not talk about money to Red Bull; if they feel spending will yield results then they will spend. This is the reason why they are splitting with Renault as they were non committal on increased spending to catchup.

Yes, hence why I said "more or less". Probably talks were ongoing about engine freeze, and in 2005 there was much more emphasis on aero/chassis development due both less restrictions and less data/knowledge at the time (yes, even taking in regard that in 2005 aero rules got a lot more strict). I'm also assuming that their commitment back then concerning investments and resource deployment was alot less then it is today.

The current system of development are quite strange. Red Bull would be able to develop that PU outside F1, free of restrictions (well, except that they can't put into a current-time chassis). However, once they bring that PU inside sanctioned FIA events and need to homologate it, the fun is over and the PU has to be spot on. So next to a huge investment, there's also a high risk it goes wrong and then Red Bull is stuck in that situation. I share your view there: it does not allow an underdeveloped PU to be brought in order to develop and improve it.

Let us not talk about money to Red Bull

I disagree. For Red Bull, F1 is a means to generate revenue due exposure. Money comes into play of this. You are right concerning Renault, but the competitive reasoning does not exclude monetary reasons.

[FW17]

With regard to development timelines

Mercedes Benz 500I was thought of in July 1993, first bench tested in January 1994, raced in May 1994

sadly engine design has become more complicated now

[turbof1]

With regard to development timelines

Mercedes Benz 500I was thought of in July 1993, first bench tested in January 1994, raced in May 1994

sadly engine design has become more complicated now

And a lot more restricted too. Atleast in those times you had more freedom to walk certain innovative paths to achieve something.

[Mattchu]

I'm sorry but I cannot accept that building engines is not part of an energy drinks companies core business, if building F1 chassis and aero dynamics with lead designer Adrian Newey(best in field) along with CFD etc is somehow is part of their core business.

That's pure hypocrisy

It's not, but I do understand where you are coming from. That sentiment atleast clears up your point of view. You have to understand that Red Bull more or less is a team that entered the sport under the V8 engine freeze. Hence there was never a need in the first place to built your own engine: the manufacturers would have more or less the same engine. So it would make perfectly sense to just get supplied.

What that in mind, they built a factory with only developing and building the chassis/aero in mind. That alone has been a huge investment and huge yearly cost, but for them that worked out concerning ROI: after all they were winning races and championships, which was marketing-wise a huge benefit. Remember: F1 as a business is not part of their core business. It's part of their marketing activities, and with all marketing activities, the goal is to gain more revenue then you loose with the extra cost. The ROI was in that frozen V8 format just that: profitable.

But now in 2014, the way you are going to be competitive in F1 has changed. No more engine/PU freeze means manufacturers are back in the position to purposely deliver what they want to their customers. Meaning that the only way a top team is going to be competing for race wins is by building their own engines or attracting a manufacturer that only wants to exclusively work together with 1 team (yes, I very much underline that fact). However, say they'd do that and built their own PUs and start winning races again. Are they going to benefit from it? No, they doubled their costs just to get back in the previous situation of marketing value. The marketing value will not rise due that PU, development costs will not be able to spread over any automotive business (they have none) and there will be no extra revenue generated to justify the increase in costs. They are not going to stay in F1 under those terms.

But didn`t Red Bull have exactly that in there "partnership" with Renault? Is it just the fact Renault were not prepared to throw millions towards engine development in an effort to catch up to Mercedes and Ferarri that they couldn`t see any future using their units?
I wonder if there was ever the prospect of Red Bull being a full works team along with Renault and having a seperate power unit division which they could influence at the very highest level , rather than being a customer team and having to buy engines!
It`s all become very messy and certainly isn`t doing Formula 1 any good at all...

[turbof1]

But didn`t Red Bull have exactly that in there "partnership" with Renault? Is it just the fact Renault were not prepared to throw millions towards engine development in an effort to catch up to Mercedes and Ferarri that they couldn`t see any future using their units?

You can obviously tell that just cooperating is not enough. Infact if we look at the manufacturers that also produce their own chassis and aero versus the manufacturers who don't, then we can see that Mercedes and Ferrari got it managed while Honda and Renault did not. I'm not saying an exclusive supply cannot succeed, but it requires to break down quite a few barriers concerning trust and sensitivity. In my eyes Renault and Red Bull have not only failed that, they have brought the partnership to its breaking point.


I'm not convinced it's just throwing millions at the project. It simply does not explain why the engine is much less reliable then last year. There have been errors in the decision making. Ultimately, in a supply-demand situation, that blame falls automatically to the supplier: Renault. I'm however no longer sharing the idea that Red Bull is not to blame alongside. They did not correctly anticipated that their previous situation in which they just got supplied by an engine and would have the chassis make the difference, would no longer be in effect.

[FW17]

Red Bull Racing team boss Horner told the Austrian broadcaster Servus TV: "There are talks with two manufacturers."

Fascinatingly, although Mercedes' motor racing chief has categorically ruled out a deal for Red Bull, Horner hinted that the German autoamaker could still be an option.



Horner said: "The decision does not lie with Toto Wolff. It is at a higher level."



Wonder who the other manufacturer is? Still Ferrari? Honda?



Up yours Toto!

[turbof1]

"Nonetheless, Red Bull Racing team boss Horner told the Austrian broadcaster Servus TV: "There are talks with two manufacturers."

Fascinatingly, although Mercedes' motor racing chief has categorically ruled out a deal for Red Bull, Horner hinted that the German autoamaker could still be an option.



Horner said: "The decision does not lie with Toto Wolff. It is at a higher level."



Wonder who the other manufacturer is? Still Ferrari? Honda?



Up yours Toto! :rotfl:

Uhmmm... What am I missing? Source please?
EDIT: nvm, I was replying on your previous version of the comment.

[Thunder]

Up yours Toto!

Not really. Who do you think counsels Zetsche in that decision?
They had a nice Meeting in Monza and discussed that.

[Phil]

I'm however no longer sharing the idea that Red Bull is not to blame alongside. They did not correctly anticipated that their previous situation in which they just got supplied by an engine and would have the chassis make the difference, would no longer be in effect.

I think the major issue is that none of the *not engine manufacturers* anticipated that the difference between how these PUs perform would be this big. My guess is, neither did the FIA when they drafted the rules. I mean, did we [as in F1T]? I remember most rumors of Mercedes having ridiculous amount of more horsepower to be quickly disregarded as hype and as utterly unrealistic. 2014 has shown us otherwise, even when not everything is PU related. 2015 has since then shown us that max power figures are not the only factor, but sustainable power/harvesting/deployment just as important as the peak figures probably moved closer together between engines.

In other words; back in 2012-2013 - most teams didn't feel that a PU would outshine the others by such a gap. If fuel flow limit and harvesting/deployment limit had narrowed the difference between 'good' and 'underperforming' engines more; I think this would have been a rather insignificant topic altogether. Also the token system would have worked perfectly in limiting by how much some manufacturers could extend their smaller advantage over others.

As a customer and partner; RedBull is realizing that the Renault PU didn't meet the required level of performance [to compete at the top and justify the investment they are still making, which is among the highest] and obviously, RedBull have little confidence that Renault will get there.

Amusingly, Renault themselves may have realized the integral part of being their own team (just as Ron has been saying post Suzuka in interviews when talking about why they switched to Honda) if they want to have any chance to compete at the very top; No more works-team PR contracts but to enter as one and the same team where chassis/aero and PU can be perfectly planned, designed and executed under the same roof without any confidentiality issues between their different divisions.

Where does this leave RedBull? Heck, where does it leave all customer teams? If the issue is this real, we already have a 2-tier championship, way before some engine manufacturers can successfully argue in favor of supplying customer teams with a b-spec engine.

[turbof1]

Where does this leave RedBull? Heck, where does it leave all customer teams? If the issue is this real, we already have a 2-tier championship, way before some engine manufacturers can successfully argue in favor of supplying customer teams with a b-spec engine.

There is a genuine treat indeed that we have a 2-tier championship, although I'm not really sure if we can simply divide the tiers between works-teams and customer-teams. Rather, I'd divide the 2 simply being Mercedes/Ferrari in the first tier and everybody else in the second one. The second tier you could divide in 3 categories:

-Mclaren and Renault will form a category of their own, being in theory works teams, but their PUs are considerably lacking behind. I personally don't think they can recover from it.
-Teams who have outstanding aerodynamic platforms and who are a threat if given a full works PU, so are given a previous-year-spec PU instead to lower their competitiviness.
-Teams who have rather weak aerodynamic platforms and who are not a threat if given a full works PU, so they are given exactly that.

You could say that in the future, so within 5 years, all the development will be frozen and that we'll get back to the previous situation. However, there's a very big possibility the development plan will be extended due the PU rules changing for 2017/2018.

The question where that leaves Red Bull? One of two things: either with a works PU next year, or out of the sport. I'd go with the latter.