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Home » Andretti in Formula 1: teams want $500-600 million compensation

Andretti in Formula 1: teams want $500-600 million compensation. Teams want $500-600 million compensation .

On the one hand, there is the activism from FIA president Mohammed Ben Sulayem, including on the social media platforms, on the other hand the intangible position adopted by the teams and by Liberty Media which, without officially expressing their view, are clearly against the idea of new teams entering Formula 1.

Michael Andretti, on the occasion of last year’s Miami Grand Prix, had gone around the paddock in order to collect signatures from team principals in favor of his Formula 1 entry, a way of working that was appreciated by the managing director of Liberty Media Stefano Domenicali.

Michael Andretti was clearly informed that to enter Formula 1 he needed the support of a major manufacturer and the American’s response to this request arrived last week, with the official confirmation of a partnership with General Motors and in particular with the Cadillac brand, to enter Formula 1 starting with the 2026 season.

The only team that proved to be in favor of Andretti’s entry into F1 was Alpine and this should come as no surprise given that the French manufacturer will be the eventual supplier of power units and various components that will only be ‘rebadged’ Cadillac.

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In practice, Cadillac would like to repeat the Alfa Romeo operation which has been the title sponsor of Sauber since 2018, a showcase which, as confirmed by the CEO Jean-Philippe Imparato, was exceptional given that the investment yielded five times the amount invested in terms of image gains, an operation for which Jean-Philippe Imparato credits all the merits to Sergio Marchionne.

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This concept of ‘practically free advertising’ is obviously not easily accepted by competitors of the Cadillac brand such as Ferrari and Mercedes, which invest millions of euros in Formula 1. Furthermore, according to reports from the BBC, the teams already registered in the Formula 1 championship believe that the entry fee of 200 million dollars would be compensation that would cover the loss of revenues due to the extra share for just two years. The ‘correct’ figure, according to the teams, would be around 600-700 million dollars to cover five years of revenues lost due to the loss of revenue, a figure that reflects, for example, what happened in the NHL – the United States professional ice hockey league – where a new franchise Seattle had to pay $650 million to join the league.

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Andretti has therefore bet on General Motors to bring to Formula 1 the great power unit manufacturer which is necessary to enter the sport, but Andretti’s rival could in fact be the historic one of General Motors, i.e. Ford, which is studying a partnership with Red Bull. When the first rumors about the agreement with Red Bull circulated, the Detroit company did not want to officially comment on the speculations, but at the same time did not deny them. The Andretti question has undoubtedly put the spotlight on a conflict that seemed to have faded, the one between Formula 1 and the FIA. Mohammed Ben Sulayem is sharing his thoughts on sensitive issues using his personal Twitter account, not that of the Federation. A move aimed at demonstrating power, which is certainly not liked by Stefano Domenicali and Liberty Media: the former Ferrari boss has always highlighted how delicate issues such as negotiations with new teams to enter Formula 1 should only be discussed when all the pieces of the puzzle have fallen into place without rash statements which can put the parties involved in the matter in an awkward position.

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Jan 10, 2023Scuderia Fans
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