Scuderia Ferrari team principal Frederic Vasseur cautions that Formula 1 is failing to draw lessons from history regarding the financial situation of teams as discussions are underway to finalize a new Concorde Agreement. The existing binding pact involving all ten sides, FOM, and the FIA is set to expire following the 2025 Formula 1 campaign, paving the way for a new Concorde, the ninth iteration, to be implemented for the 2026 championship.
Among the topics on the negotiating table is the contentious matter of grid expansion, with Formula 1 and current teams staunchly opposed to welcoming an 11th team onto the grid. Andretti is currently engaged in commercial talks following the acceptance of its bid by the FIA in October.
Teams are hesitant to permit an 11th squad due to the potential reduction in their slices of the prize pot to one eleventh instead of one tenth. Andretti contends that it can contribute to growing the overall pot to offset the impact on other teams.
To safeguard against this, any aspiring new team must pay a $200 million anti-dilution fee, evenly distributed among the existing teams. There have been suggestions of increasing this value to as much as $600 million.
Adding complexity to the financial landscape, teams are currently adhering to a cost cap regulation, but the cap has been adjusted in 2023 to accommodate global inflation. Ferrari team boss Fred Vasseur expresses concern about the uncertainty stemming from the evolving financial scenario.
“It doesn’t matter the format, the organisation and the rules. At the end of the day, if you are 11 teams, you are more exposed than if you are 10,” Frederic Vasseur pointed out when asked by the journalists on this matter – “When you are in a positive situation and the business is going up, I think everybody is positive and optimistic, but I’m not sure that it will stay like this forever.” – the French manager added.
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“We have to really pay attention. On one hand, we are moving to increase the costs at every single meeting. We put inflation [into the cost cap] we change the index for the inflation blah, blah, blah, and we increase the CapEx. And now we want to dilute more the incomes. It’s not easy also to run a business and to do forecasts when you have this kind of change so often and honestly we are not learning from the past and this is a big issue.” – the Ferrari team principal continued.
James Vowles, the head of Williams, also joined the discussion, expressing strong opposition to the addition of a new team at the moment. This stance aligns with the team’s ongoing struggle with a challenging financial situation, having incurred losses exceeding $10 million annually in the past couple of years.
“It’s not that there’s no room for an 11th team, it’s just we have to be financially stable to do so. I appreciate we’re increasing things but we are getting ourselves towards financial stability for the first time in forever, really. Let’s get to that point and see where we are. So it’s not actually against an 11th team whatsoever at all, and I think Concorde should reflect that. Let’s grow at a point where we can grow. I’m not sure that’s today.” – James Vowles concluded.
