D-Day Friday

June 10, 2009

Professor Mark Jenkins

Professor Mark Jenkins

Well here it is, my first go at keeping up with my technologically adept colleagues – the Jenkins F1 blog! The reason for doing this now is simple. On Friday we will learn whether F1 has reached a common sense compromise between the regulatory body (the FIA) and the teams association (FOTA), or whether the FIA has rejected the validity of the FOTA ‘conditional’ entries for 2010 and not included them in the list of entrants, creating the kind of schism that we last saw in F1 in the late nineteen seventies – ie thirty years ago. I hope it’s the former, but history suggests its more likely to be the latter.

In essence all parties want to achieve the same end – lower costs making it easier for current teams to sustain their operations in the face of reducing sponsorship revenues and also making it easier for new teams to enter if, as looks likely, a number of the car manufacturers will pull out over the next few years. The argument centres on how this should happen, who should determine and police the levels needed, and also when it should happen. The FIA want it to happen quickly and have imposed a £40 million cap (excluding a range of expenses) for the 2010 season which probably equates to a significant cut of around 70% for the existing teams. The budget cap will be monitored through an audit process. In contrast FOTA want this to happen more slowly and have proposed a ‘glide path’ to allow them to reduce costs by reducing the number of upgrades to the cars during the season, homologated gearboxes and low cost engines. The FOTA teams have also signalled that they are prepared to enter into a new Concorde Agreement (the lapsed legal framework that provided the basis for the F1 commercial operation) until the end of 2012 – thereby committing all the current manufacturers to remain until then. Their approach is also to be one of self-regulation rather than external auditing.

 Of course in addition there are also one or two other issues to resolve such as the redistribution of revenues to the teams, and (I almost forgot) the appeal to the fans – who certainly in Istanbul last weekend decided to vote with their feet leaving the cars circulating a virtually deserted track.

 So let’s see what happens. I’ll be back on Friday!

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