Mercedes reveal the cost of record-breaking 2020 F1 title success

Mercedes

Mercedes reveal the cost of record-breaking 2020 F1 title success

Mercedes spend almost £325million last year

Ian Parkes

Sunday 9 May 2021 11:20

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Mercedes has revealed it spent almost £325million on its record-breaking title success of last year.

The figure comes from the release of the team's annual accounts for 2020 which show Mercedes still emerged with a profit despite the year being overshadowed by the Covid-19 pandemic.

The overall gross spend on winning a seventh constructors' championship and Lewis Hamilton's eighth drivers' title was £324.939m.

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Turnover, however, amounted to £355.301m, leading to a gross profit of £30.362m, a slight increase on the 2019 figure of £30.337m.

Following the deduction of administrative expenses, interest and tax, Mercedes accumulated a net profit of £13.638m, down just over £1m from the previous year.

The figures show that even in the worst of times, the Mercedes brand represents high value, underpinned by the fact that with 17 races, the team enjoyed a 19.2 per cent share of television coverage, equating to an advertising value equivalent of $5.783billion [£4.131bn].

In addition, it has been determined the value of the Mercedes-Benz brand has grown in value from $31.9bn [£22.80bn] in 2013 to $49.3bn [£35.24bn] last year.

Signing off on the financial report and addressing this year ahead, team principal Toto Wolff wrote: "Mercedes-Benz Grand Prix Limited will continue with its principal activities as a Formula One racing team and aspires to win both championships for the eighth consecutive season.

"In addition, the company will operate and grow a market-leading Applied Science division, delivering high-performance engineering expertise to new and existing third-party customers."

From this season the team is now operating under a strict cost cap of $145m, with Wolff highlighting the problems the team has faced and will continue to do so in meeting that challenge.

"From 2021, the introduction of new financial regulations will enable Formula One teams to achieve financial stability in the years ahead," added Wolff.

"These regulations have required significant efforts to reshape and restructure the organisation to ensure full compliance from 2021 and continue to deliver maximum on-track performance."

In conclusion, Wolff wrote: "Thanks to the range of revenue streams for Mercedes-Benz Grand Prix Limited during the year, the company is still able to maintain profitability and to meet all financial obligations.

"A prudent approach will continue to be taken in regard to possible impacts on the business and contingency plans are regularly reviewed to mitigate effects of the virus on the business."

"As a high technology business, the team can adapt competitively and commercially to changes in its operating environment and will continue to invest in its capability and culture to ensure medium and long-term success both on and off the track."