F1 working to avoid showdown after "explosion of costs"

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F1 2022

F1 working to avoid showdown after "explosion of costs"

Global crisis has prompted talks of budget cap raise

Ian Parkes

Friday 20 May 2022 05:00

McLaren team principal Andreas Seidl has welcomed discussions over a raise to the budget cap following what he has described as an 'uncontrollable cost explosion' in F1 this year.

The latest global financial crisis, with Russia's war on Ukraine playing its part, has had a major impact on everyone from ordinary families to major businesses alike.

While F1 has managed to weather the various storms that have tried to blow it off course over the years, it is not immune, and this season is no different.

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In a year when the budget cap has been lowered to $140million, the bigger teams are finding it difficult to hit their targets as inflation soars and energy bills and freight costs rise.

It has prompted discussions on raising the cap although as is customary in F1, there is a lack of unanimity, threatening a potential showdown at some point this year.

In the past, McLaren has always been pro-budget cap but even Seidl concedes these are difficult times for the Woking-based team, and that the talks are necessary.

“As you know, we have always been big supporters in order to make sure we stick to the cost cap," said Seidl.

"But at the same time, we are open to the discussion at the moment because in a situation like we are in, with all these unexpected things that have happened leading to an explosion of costs that we just can’t control anymore or can’t counteract, it is an absolutely fair discussion that needs to be had.

"We need to see how we can deal with that as a Formula 1 community in order to make sure it is manageable and fair for everyone.”

F1 healthier than ever

From an overarching point of view, however, McLaren CEO Zak Brown feels F1 has never been in a better position than it is at present.

Following two difficult years through the Covid-era, F1's revenues are growing again and the interest in the sport is so high there are not enough available weekends to accommodate the number of potential races.

Following the recent success of the Miami Grand Prix, and with Las Vegas due to come on board next year, Brown said: "It’s the healthiest I’ve ever seen the sport.

"You have 10 teams that are extremely well funded, it has a strong ownership group, we have grands prix with record attendances, and you have record sponsorship, certainly revenue growth in America.

"I have not seen a healthier Formula 1 in the six years that I have been in it but the 20 years I have been around the business.”