The 2021 Formula 1 season has actually been over for nine months. It was one of the most turbulent ever with a finale in Abu Dhabi that made Max Verstappen world champion and left Mercedes seething with rage. The Constructors’ World Champion felt betrayed by the late decisions made by race control regarding the use of the safety car. The aftermath was felt throughout the winter break and cost race director Michael Masi his job.
It was thought that a line had been drawn. But the past season just won’t let Formula 1 go. The latest twist could cause an earthquake. Apparently two teams have exceeded the budget cap. The teams were allowed to spend a maximum of 148.6 million US dollars in 2021. Red Bull and Aston Martin are said to have been about it. One clearly over it, the other not quite so much.
Mattia Binotto and Toto Wolff speak
Red Bull wonders how the story could ever get to the public. After all, one would be in exchange with the FIA, in an ongoing process of testing. The FIA, on the other hand, is keeping a low profile. On Friday (September 30th, 2022) the world association sent two statements. The latter stated that the FIA had noticed “unfounded speculation and conjecture”. And they wanted to make it clear once again that the evaluation is ongoing, that they stick to the process and do not allow themselves to be influenced by external discussions.
With a story of this magnitude, there is of course a lot of talk in the paddock. Red Bull’s competition feels cheated if world champion Max Verstappen’s team actually spent more than they were allowed to. Ferrari team boss Mattia Binotto and Mercedes team principal Toto Wolff put their heads together for an hour on Friday before the first practice session in Singapore.
Figures are circulating in the paddock that Red Bull could have exceeded the budget cap by ten million dollars. That would be a capital offense. Invoices are made immediately. That amount could employ 100 engineers for $100,000. That would inevitably increase the output of the development department. Ten million: Many teams don’t even have that much budget for mid-season upgrades. Alfa-Sauber team boss Frederic Vasseur provides information: “We only have 2.4 million to develop our car during the year.”
Red Bull fights back
Red Bulls team boss Christian Horner responded to the allegations that documents had been submitted which revealed that they were within the maximum limit, while Helmut Marko pointed out in front of the TV microphones that Red Bull was not too worried. “We submitted the documents in March, as required by the FIA. With these complicated rules, it is clear that the examination takes time. The FIA and the teams are going through this process for the first time. We are eagerly awaiting the outcome. We are absolutely certain that we are within the limits,” said Horner. The team boss added: “How can our opponents make such public comments? Only the FIA and we know the documents. Things are said that are damaging to our reputation.”
The teams are worried that the amounts will be fine-tuned so that the FIA does not have to impose a penalty which affects the outcome of the 2021 World Cchampionship. Last year’s opponent, Mercedes, and this year’s competitor, Ferrari, demand severe penalties. Because Red Bull did not only benefit in 2021, but also this season and will do so in the next, given the fact that they developed in parallel last season – on the old and the new car.
That’s why, according to the accusation from the competition, Red Bull got off the starting blocks so well with the 2022 car. The opponents believe that Red Bull is also in the second year of the budget cap above the limit. This would also give them an unfair advantage for the coming season. For example, with a lightweight chassis that Red Bull no longer wants to use in 2022, but which is said to have already passed a crash test. They could use it in 2023 – and only then calculate the costs for production. Mercedes points out that they didn’t have the money to slim down their car this year as they wanted.
FIA to give result before GP Japan
Another objection from the competition: In 2021, taking over around 70 percent of the 2020 car saved development costs of 25 to 30 million. In this case, it’s not just about sport, it’s also about people. Mercedes calculates that the F1 racing team had to be reduced in order to play within the financial rules. That more than 40 people had to be put on the street. Ferrari and teams like McLaren also had to lay off staff in order not to break the budget cap. Those were painful pull-ups. And they are are all the more angry if others have not followed the rules.
Horner asserts: “We lost 90 people because we had to restructure heavily.” McLaren team boss Andreas Seidl expresses concerns: “We had to make layoffs and also get the salaries. There are other teams that don’t make any cuts. We wonder how they can pay such salaries.”
In the case of Red Bull, the team and the three FIA inspectors apparently disagree as to whether and how certain personnel will be counted. Red Bull claims engineers are included in the budget cap who actually have nothing to do with the racing team. Instead, they should be employed in the engine division (Red Bull Powertrains), which does not count towards the budget cap, or at Red Bull Advanced Technologies, the technology arm that takes care of high-performance products such as hypercars.
The FIA intends to publish the results of the audits between Singapore GP and Japan GP. On the Tuesday or Wednesday before the Suzuka race. And communicate possible penalties immediately, provided that the teams concerned give their consent. Of course, this is only possible if they accept the punishment that has been pronounced and do not go to court. Until the FIA breaks cover – and this is important – Red Bull and Aston Martin must be presumed innocent.
The financial rulebook divides violations into three categories. 1) Procedural error. For example, when documents are submitted late. That happened to Williams. The FIA imposed a fine of $25,000. Williams also had to bear the legal costs. 2) A slight overrun of the budget cap. The FIA understands this to mean an excess of up to five percent. That would have been $7.4 million in 2021. 3) An excess of more than five percent.
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The rules leave open how exactly a penalty could be. Consciously, so that teams don’t overdo it on purpose, because they can live with the punishment then pronounced. On the other hand, the vague formulations open doors for backroom deals. One thing is clear: Mercedes and Ferrari, like other teams, also demand punishment that hurts and deters. Because you can do a lot with a million more.
The FIA can, for example, deduct points in the team and driver championships for minor and major violations. In the case of the Constructors’ Championship, it wouldn’t hurt Red Bull. Unless the FIA responds with a draconian penalty. Red Bull finished second in 2021 with 585.5 points. The buffer to Ferrari (323.5 points) was large.
Dangerous precedent
The situation is different in the Drivers’ World Championship. Verstappen prevailed against Hamilton with 395.5 to 387.5 points. A deduction would put the title at stake here. The financial rules also allow the FIA to deduct wind tunnel time from a team or reduce the budget cap for another season. They also reserve the right to exclude a team from races. Even being kicked out of the World championship is possible.
The FIA must ask itself the question: does it consider even a small violation to be doping or not? If it is too lenient, it sets a dangerous precedent. Then every team that can spend additional millions would deliberately exceed the budget cap. Then the FIA could throw their rules in the bin right away. And Formula 1 forgot the idea of equal opportunities. Because that’s what it’s about. The budget cap is intended to bring the field together over the years and leave all teams on sound ground. “We demand a clear and transparent clarification of the case,” says Ferrari sports director Laurent Mekies. “With the numbers that are in circulation, you can calculate how much lap time the additional expenses bring.”
The outcry about Red Bull is huge. But the Aston Martin case is also interesting, should the team have broken the rules. Here the budget cap is said to have been exceeded by transfer fees for poached engineers. New staff may not bring any advantages in the short term, but in the medium and long term. And it weakens the competition.
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