F1 to keep the FiA afloat

[WhiteBlue]

After much discussion about the matter in recent weeks - with teams seeking clarification on why the costs were going up - the FIA has finally revised its sporting regulations to confirm the scale of the increase. As previously reported, the governing body amended the original plan to include a system whereby the champion outfit pays a premium price.

Under Appendix 7 of the newly published 2013 Sporting Regulations, the governing body states that there will be two levels of fees for teams. The constructors' champions will have to pay a base $500,000 US plus $6000 US per point gained in the standings. Every other team that wants to enter will have to pay the basic $500,000 US plus $5000 US per point. Looking at last year's world championship standings, it means teams will see their entry fee costs rise from last year's standard rate of 309,000 Euro ($397,899) to:

Red Bull (650 points) $4.400 million
McLaren (497 points) $2.985 million
Ferrari (375 points) $2.375 million
Mercedes (165 points) $1.325 million
Lotus (73 points) $865,000
Force India (69 points) $845,000
Sauber (44 points) $720,000
Toro Rosso (41 points) $705,000
Williams (5 points) $525,000
Caterham (0 points) $500,000
HRT (0 points) $500,000
Marussia (0 points) $500,000

The updated Sporting Regulations do not lay out a final entry deadline for teams, but do state that teams must pay the entry fee by November 30. The FIA's decision to increase entry fees comes amid a push by the governing body to increase the revenue it gets from the sport - with it believed to be chasing a total income of $40 million per season as part of a new commercial structure. The total revenue generated by the entry fees will be at least $16.3 million, with AUTOSPORT also understanding that the governing body is close to agreeing a $24 million payment from commercial supremo Bernie Ecclestone as part of a Concorde Agreement deal. These payments, allied to an increase in F1 Super Licence fees for drivers, will help the FIA hit its revenue target.

I think that the deal is fair if you consider what the FiA must do for motor sport. The teams and FOM have both been profiting very nicely from the bargain 100 years deal and from the commercial success of the sport. The FiA hasn't seen much of that success although it should. So it is only appropriate that the situation gets rectified, particularly if the FiA will help the teams set up budget controls that will save them hundreds of millions collectively.

[ecapox]

300m Euro to 4.4m Euro is unacceptable. This is akin to robbery.

If anything that i had to pay rose 1500x i'd be furious. Even if it was originally $10.

[rich1701]

The FIA need to demonstrate what it is doing to cut costs itself if it is to justify its income really. I think it does have a significant bureaucratic element in Paris. I am surprised the fees are so high.

[Slife]

Why did the FIA give the commercial rights to Bernie Eccelstone for 100 years ?

[WhiteBlue]

Why did the FIA give the commercial rights to Bernie Eccelstone for 100 years ?

Primarily it was done to satisfy the EU requirement that demanded a split between the commercial and the governing function of the FiA. In principle the deal made sense. What many people criticize is the pricing that was applied. The FiA got a relatively low one time payment for giving up their share of F1's continuing revenues. Originally the money was split between the FiA, the teams and Bernie. Bernie got a very sweet deal there and there have been accusations that Max Mosley was bribed by him to swing that deal.

[bhall]

Why did the FIA give the commercial rights to Bernie Eccelstone for 100 years ?

Bribery, extortion, collusion, ineptitude; take your pick. It was Mosley and Ecclestone being Mosley and Ecclestone. Now the teams have to pay* so the FIA can remain the FIA, because Ecclestone will not renegotiate that 100-year deal, which was one of Todt's goals as president.

So, once again it seems Ecclestone cannot be bothered to do something for the good of the sport if that means sacrificing even one nickel to do it. Circuits go under, teams fold, the FIA struggles, Ecclestone just keeps rakin' in the cash.



* One might say that's immaterial, because the money will come from FOM disbursements. However, one must realize that those fees are only coming out of the teams' share of FOM prize money (as they're cynically being told to cut costs, no less).

[Richard]

Primarily it was done to satisfy the EU requirement that demanded a split between the commercial and the governing function of the FiA. In principle the deal made sense. What many people criticize is the pricing that was applied.

It makes sense to separate FIA and FOM. It does not makes sense to hand it over for a fixed 100 year fee. It should have been awarded for a much shorter term (5-10 years?) to allow for re-tendering & commercial competition. That franchise should also have had an annual fee based on % of FOM earnings.

The irony is that the Bernie is reported as pushing for greater voting rights for FOM on the F1 governance body, he'll soon dominate governance, hence governance and commerce will no longer be separated. How long until F1 is no longer an FIA series?

[Hail22]

Primarily it was done to satisfy the EU requirement that demanded a split between the commercial and the governing function of the FiA. In principle the deal made sense. What many people criticize is the pricing that was applied.

It makes sense to separate FIA and FOM. It does not makes sense to hand it over for a fixed 100 year fee. It should have been awarded for a much shorter term (5-10 years?) to allow for re-tendering & commercial competition. That franchise should also have had an annual fee based on % of FOM earnings.

The irony is that the Bernie is reported as pushing for greater voting rights for FOM on the F1 governance body, he'll soon dominate governance, hence governance and commerce will no longer be separated. How long until F1 is no longer an FIA series?

Give or take, within 10 years.

[WhiteBlue]

The irony is that the Bernie is reported as pushing for greater voting rights for FOM on the F1 governance body, he'll soon dominate governance, hence governance and commerce will no longer be separated. How long until F1 is no longer an FIA series?

Jean Todt is on record saying that will fly as high as a lead balloon. The teams have dismissed the idea that they should give up their stronghold in the F1 commission. The commission according to the latest news on the issue will delegate the power of rule proposals to a steering committee which will have six team votes, six votes from the FiA and six votes from FOM.
Perhaps that steering committee will be able to come up with reasonable rule proposals quicker than the unwieldy F1 commission. It would be an advantage. When a rule change is created by the steering committee it will have to be passed by the full F1 commission and by the World Motor Sport Council.