Entry fee to safeguard Formula 1 and create investment opportunities

Haas

Entry fee to safeguard Formula 1 and create investment opportunities

Steiner believes the budget cap will increase the profit value of Formula 1 teams

Ewan Gale

Saturday 19 September 2020 13:40

Haas team principal Guenther Steiner believes the $200 million fee implemented for new teams to join the Formula 1 grid will safeguard the sport as it "incentivises people to buy a team that is there."

The payment seeks to ward off teams who are financially unstable, meaning a repeat of the demise of the USF1 team, for example, would be effectively impossible.

The news was broken by McLaren CEO Zak Brown ahead of the Tuscan Grand Prix and Steiner believes it will sway people towards buying an existing team rather than forming a new outfit.

"Zak is the spokesman of FOM now," Steiner joked.

"I will send a text to him later to congratulate him on the new job.

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"I think that we should do something like this, I think we should incentivise people to buy a team that is there instead of a new one coming in, and I won't comment on the number but there are reasons why we do these things, to protect the people which are there.

"I think it is an opportunity because you create a value. You can't create value for someone coming in new. You need to invest upfront but you should not have teams who can't make it because they can't raise that amount of money.

"So whoever comes in needs to put a solid chunk of money down to buy a license and run a team. You're almost sure that you can get people who can raise this amount of money."

In the last ten years, four teams have joined the grid but three have subsequently left the sport due to the financial toll taken to attempt to build a competitive Formula 1 car.

Of the 'new' teams, Haas is the only surviving outfit but Steiner is certain the imminent budget cap will mean the sport will be more attractive for people seeking investment opportunities.

"The good thing is with the budget cap is you can budget for how much you are going to spend," he added.

"Before you could spend half a billion, now you can't anymore so now for investment, now you know how much it would cost you and now you can evaluate whether it is worthwhile the risk in investigating.

"I think it is positive for F1 that if someone comes, it is serious."

Before you go...

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