Zak Brown: F1 budget cap a "path to profitability"

McLaren

F1 budget cap a "path to profitability" - Brown

The budget cap will close the gap between first and 10th

Sam Hall

Saturday 4 July 2020 08:00

McLaren CEO Zak Brown believes the Formula 1 budget cap will "put a better product on the track" when it is finally introduced in 2021.

F1 had planned to introduce a cost cap of $175million, but the global pandemic and resulting financial pressures on teams and manufacturers saw this figure drop to $145m for next year, $140m in 2022, and then $135m from 2023 for three years.

“I think the teams did an excellent job over the extended winter to address the fiscal nature of the sport," Brown said in Friday's FIA press conference.

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"As I think everyone knows, there was too big of a spread between first and 10th, which then plays itself out also on track.

“I think if you can get a sporting franchise which is profitable, then I think the value of that franchise goes up significantly. You get asset appreciation, and I think all of our shareholders love being in Formula 1.

"I don’t think they’re in it necessarily to turn a profit, but they’re also not in it to lose substantial amounts of money, which has been the case for a lot of teams.

“I think we’ve landed in a place where the is a path to profitability. I think it closes the gap between first and 10th. I think that will put a better product on the track ultimately. I think the fans win and I think it was a good compromise.”

Mercedes team principal Toto Wolff also backed the compromise, even though the championship-winning outfit was initially against the lowering of the cap.

“For us, speaking for Mercedes and our partners, the return on investment has to be right, and Formula 1 is probably one of the best marketing platforms in the world," said Wolff.

"We’re able to generate return on investment of up to 20 times the investment of Mercedes and its partners.

“So from a marketing standpoint, it has always made sense and does make sense.”

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