Salary cap, Shmalary Cap

[bathurst77]

I also still think customer cars or 3 car teams would help
If constructor spends 140mill, but that builds 4 cars and they sell 2 to newteamx for 50 mill, now they have only spent a net 90Mill, so have 50 to use again, for new parts and testing etc.

new team x now has 2 cars for 50, so 90 to play with for all the other stuff f1 needs (or maybe Customer car teams have much lower cap)

NEt result... more cars on grid. At the moment the current 10 are concerned more teams cut into their slice of the FIA pie, but that would be offset if they can make and sell cars.

The cars them selves arent the big expense its design testing etc that costs the big bucks. The old saying The first one cost 20 million, the second one a few hundred thousand

Or the spending cap is 70Mill multiplied by the number of cars raced. Two ar teams get 140, 3 car teams 210 (or whatever number feels right maybe a base figure plus a per car entered)

A 3rd car could be ruled such that no driver can drive no more than x rounds a yyear, so be a "rookie" or up and coming car. So give the next Piastris/devries/doohans/hertas a few races to show his talent. At the moment there is no way to to audition candidates in a race except to take one of your main drivers out, obviously the drivers dont like that, and the team would affect their points in WCC. SO make it only the top 2 finishers for each team each race gets constructors points)
Car 3 could carry different livery than the main 2, so if the youngster has a sponsor that can pony up for their sticker on 1 car for a subset of races it is much cheaper than on both main cars all year, sa youngester ccan say I have a little bit of backing but not enough to pay drive a year... can i have 3 races for $XXX?
And could have local sponsors for any countries race (as Mclaren have done a few times this year) So Telsta/optus/VB might want a car in the Aust GP or a few races but not in Azerbijan or Saudi arabia, where they dont work in,

now we get a number of wins... more cars... a way for the rising stars to race just a ffew events and show their talent without costing the teams anything by way of championship points etc... and the teams have an additional income stream .. more R&D.. and new sponsors can get in cheap and maybe decide to go all in for next season

[bathurst77]

Customer cars could also end up with newteamx running (for example) red bull chassis that they modify to fit a ferrari pu and gearbox
it would be very embarrassing if a factory team like mercedes got beaten by a customer car with mercedes body and honda/renault/ferrari pu, but i suppose we have the reverse of that now if mclaren/AM beat mercedes or haas/sauber outdo ferrari.

we could have interesting mixes

Ferrari f1 team use ferrari chassis and p/u
mercedes f1 use mercedes chassis and p/u
NewteamX use ferrari chassis and mercedes p/u
NewteamY use mercedes chassis and ferrari p/u
NewteamZ use ferrari chassis and p/u, but their own engineers and pit tacticians and strategists who make different calls and car setup.
All of these things have happened in the 1950s - late 70s and in indy/cart

[Akrapovic]

Originally Posted by bathurst77

Does the fact that teams are having trouble staying under the cap mean it is too low?

Absolutely not.

If someone is earning £1m a year salary, and then suddenly you say "Hey, your salary is now only £250,000 a year", it doesn't mean that £250k is too low. It means they have to make lifestyle changes to make it work.

F1 teams need to make lifestyle changes. Doesn't mean they can't operate a team on that budget - Just they will have to make changes to make it work.

[chillibowl]

Originally Posted by bathurst77

Does the fact that teams are having trouble staying under the cap mean it is too low?

Should the cap be set to allow room for R&D and test hardware.
Does it mean teams cant afford to experiment with radical ideas, like they did with turbo, ground effects, 6 wheelers, fan cars etc. All those things were expensive radical ideas at the time.

radical ideas but were they expensive ideas or rather did they just seem like expensive ideas at the time because budgets were relatively much smaller back then?

as R&D is moving/has moved almost exclusively towards computational modeling and as those processing systems become cheaper, more widely available, can be done with less staff etc...is the amount of money available the main hinderance to innovation?

bigger issue i would think, is the inference that the governing body, to maintain the integrity of the cap, will ban ideas that can potentially force competitors to spend in order to keep up and thus potentially destabilizing the support behind the cap.

the 'spirit of the rules' or 'exploiting a loophole' bans are not necessarily bad concepts but yes were are very much trading in innovation for homogeneity in the hopes that it leads to a more competitive field.

as adam said:

Originally Posted by Adam43

It’s not mutually exclusive, but if you had to chose would it be encourage innovation or competitiveness. At the moment there is more shouting and emphasis on the later.

for myself, im very much about prioritizing competition (and entertainment) these days. for a number of reasons but mainly because its not like massive spending over the past 15-20 years also didnt lead to homogeneity but without the hope for broader competition right?

Originally Posted by bathurst77

I also still think customer cars or 3 car teams would help...

i also like the idea as long as the 3rd car doesnt just get farmed out to pay drivers but little luck in that happening.

another interesting comparison to the NFL and their cap rules is that teams (including the Lions) are required to spend a minimum amount of money on salary.

if new areas of revenue generating and/or cost savings are being opened up for the teams, there should also be a requirement that at least a minimum amount is reinvested into their f1 program. like a 107% rule...you cant spend below lets say 90% of the cap.

[Richard C]

Originally Posted by bathurst77

Does the fact that teams are having trouble staying under the cap mean it is too low?

No.

Originally Posted by bathurst77

Should the cap be set to allow room for R&D and test hardware.

You make do with the budget you have.

Originally Posted by bathurst77

Does it mean teams cant afford to experiment with radical ideas, like they did with turbo, ground effects, 6 wheelers, fan cars etc. All those things were expensive radical ideas at the time. SOme worked some didnt some were outlawed, but all would not have been tried if the teams didnt have the budget to build them.

I don't think the FIA even wants them to be playing in these areas. The financial regulations don't exist in a vacuum. The technical regulations are pretty tight and I expect that to continue. The FIA has specific areas that they feel it is OK for teams to be creative, but others are effectively outlawed.

Originally Posted by bathurst77

Are we now stopping new tech like flux capacitors, energy polarisers and improbability drives.

See above. Flux capacitors would likely be a technology that one team could use to dominate for a period of time. Some might think that is their reward for bringing it forward, but I think the commercial side of the sport (including having competitive stability so that someone can come and play and not be crushed year after year) is important to them. So they don't want this type of innovation due to the costs and potential to create dominance for a long period of time.

Originally Posted by bathurst77

Should the cap be set higher such that teams can easily be under now with a margin stiill for innovation, but not go supercrazy.

Ask this question of the teams who might not even being spending to the cap today! The entire point was to effectively try to fund down to the lowest common denominator. In the end, the cap was not as low as they tried to make it. So I think you still have teams who can't spend to the cap. Increasing the cap will only return us to two tiers of teams. We are only into the first season with cost caps. So we are still seeing the echos of "how it was before". I don't think we will see full parity, but the lines between the two tiers might be much more fuzzy and we might see those being able to win moving from just 2-3 teams to maybe 3-5 or so.

Richard

[steve_r]

So RBR have exceed the cap by around £1m, which is classed as a fairly minor transgression and is much less than was implied during the mass hysteria over the weekend. Any penalties are likely to be minor. RBR / Horner is still livid about the allegations and the leak - and for once I agree with him.

https://www.crash.net/f1/news/101376...ach-only-minor

[PhilipR]

If true how much is 1 million worth in development or staff. If a top engineer is paid 200k a year(just took this number out of my backside and for sake of argument really) you can have 5 top engineers for that money who can provide brainpower to development
How many spare parts or new parts can you develo for that money
I think minor transgression gives wrong interpretation of something that can have quite an impact on performance etc

I know financial regulations are different but for any small techincal infrigement a car can be desqualified(ie not enough fuel or a bigger opening on wing gap due to part fatigue) whilst for financial trasngression where one could produce 1 or 2 more working wings is called minor.

After this are we oppening up a can of worms about what is minor and all will now have "minor transgressions"

IMO for the cap to work it has to be enforced otherwise prepare every September to have these discussions

[PhilipR]

If it is only a minor transgression - this is the way out for the FIA. They can claim the team has overspent but only minor - ban them from stages of a GP - let's say a Friday at an upcoming race(so no fp1 and fp2) and then say it is all done. And if the team is RB , they can be happy as banning them from a Friday will probably not impact on the Championship outcome....so Win-Win for F1 and FIA

[S griffin]

We'll have to wait and see what punishment the FIA come up with. Got an anxious few days for some

[steve_r]

Originally Posted by PhilipR

If true how much is 1 million worth in development or staff. If a top engineer is paid 200k a year(just took this number out of my backside and for sake of argument really) you can have 5 top engineers for that money who can provide brainpower to development
How many spare parts or new parts can you develo for that money
I think minor transgression gives wrong interpretation of something that can have quite an impact on performance etc

It is less than 1% over the budget cap. Make of that what you will. There might be a penalty. But the hysteria over the weekend was suggested a very major bust over the cap which if these new reports are to be believed, is not true.

If it turns out that the initial rumors' of a major break of the cap is true after all, I will happily get my pitchfork and join in emotionally charged behavior.

[Mike Harte]

Originally Posted by steve_r

So RBR have exceed the cap by around £1m, which is classed as a fairly minor transgression and is much less than was implied during the mass hysteria over the weekend. Any penalties are likely to be minor. RBR / Horner is still livid about the allegations and the leak - and for once I agree with him.

https://www.crash.net/f1/news/101376...ach-only-minor

May I advise caution regarding this "report" as it is pure speculation, as were the stories circulating at the Singapore meeting. The FIA are yet to release the certificates clarifying the issue, and we will have to wait and see what the official reports actually say.

[steve_r]

Originally Posted by Mike Harte

May I advise caution regarding this "report" as it is pure speculation, as were the stories circulating at the Singapore meeting. The FIA are yet to release the certificates clarifying the issue, and we will have to wait and see what the official reports actually say.

But it is in the Daily Mail

[Akrapovic]

Originally Posted by steve_r

So RBR have exceed the cap by around £1m, which is classed as a fairly minor transgression and is much less than was implied during the mass hysteria over the weekend. Any penalties are likely to be minor. RBR / Horner is still livid about the allegations and the leak - and for once I agree with him.

https://www.crash.net/f1/news/101376...ach-only-minor

There's a term for "minor breach of the cost cap" - it's "breach of the cost cap"

"Christian Horner unhappy that rumours of his team breaching the cost cap are true" is my current favourite take on the rumours.

[AnnoyedMoose]

The FIA position is that anything under 5% ($7.5m) is a minor breach.

Latest "leaks" suggest Red Bull are 100k over and Aston Martin are 4m over.

[steve_r]

Will people get as angry with Aston Martin as they were seemingly getting with Red bull?

[PhilipR]

I know it is classified as minor but 4 million extra does not sound minor to me. Both ferrari and mercedes have said that 3-4 million is the cost of their spares for the year(take this with a pinch of salt)

If AM did indeed overspend by 4 million and get away with minor punishment, all be prepared for all big teams to have minor transgressions next year haha

[Anyopenroad]

I’m stunned that two teams owned by obnoxious billionaires would be the ones in breach of the rules.

[chillibowl]

if RB are only 100k over, Toto's earlier reaction seems absolutely over the top.

either he got some really bad intel or something happened over the course of the review period to RB's numbers to bring them within acceptable levels.

not suggesting anything sinister mind you. perfectly normal and reasonable for financials to change from their initial filings or over the course of the review/audit process. giving RB the benefit of the doubt they probably were allowed to reclassify certain expenses.

so how does one account for Toto's early reactions?

[chillibowl]

Originally Posted by PhilipR

If AM did indeed overspend by 4 million and get away with minor punishment, all be prepared for all big teams to have minor transgressions next year haha

and thats the issue right.

you go easy on AM and then you encourage others to do similar next year.

for me the risk of going easy to the stability of the cap means you have to make an example. and not by removing points from just the infraction year (21) but also because the naturally time consuming process of audits means for me that the penalty should also be applied to the season after the process is complete...so in this case a 2023 season penalty.

but classic Alonso though right! can this guy pick a seat or what!

[mogwai]

Originally Posted by chillibowl

if RB are only 100k over, Toto's earlier reaction seems absolutely over the top.

so how does one account for Toto's early reactions?

Theatrics/political theater for sure but also, and perhaps easily viewed by the outside eye, development pace of some teams.

Maybe he's simply using educated speculation without inside details and adding a touch of unfounded spice to make it meme worthy?

[mogwai]

Originally Posted by chillibowl

and thats the issue right.

you go easy on AM and then you encourage others to do similar next year.

Cost cap marches lower annually so if the assumption is that all teams suddenly march to the 5% overage penalty then the playing field is theoritically level because the cap marches lower.

Now that inflation will begin to cool, teams may not be able to hide behind their assumptions that inflation justifies an additional spend.

However, which measure of inflation are they using? Market breakevens? A domestic statistical agency? I have a suspicion that inflation will be the assumption bucket into which some of the suspected overages are are thrown into.

[E.B]

FIA delays release of F1 cost cap certificates until Monday

“The FIA informs that the conclusion of the analysis of the 2021 financial submissions of the Formula 1 teams and the subsequent release of Certificates of Compliance to the Financial Regulations will not take place on Wednesday, 5 October,” the statement reads.

“The analysis of financial submissions is a long and complex process that is ongoing and will be concluded to enable the release of the Certificates on Monday, 10 October.”

In the statement on Wednesday, the FIA repeated its comment noting “significant and unsubstantiated speculation and conjecture” concerning the budget cap.

“The FIA reiterates that until it is finalised, no further information will be provided,” the statement added.

“The FIA also reiterates that any suggestion that FIA personnel have disclosed sensitive information is equally baseless.”

[Richard C]

Originally Posted by E.B

FIA delays release of F1 cost cap certificates until Monday

Clearly the FIA should be penalized for being late on their certification!

Seriously, this just gives everyone more time to speculate. Is it 100K, is it 4M is it zero? Who is worst RBR or AM? Ban them all! Cost caps are broken! Teams should be able to spend what they want! Cost caps are not low enough!

Richard

[thetool]

The reason for the delays is obvious, negotiations behind-the-scenes as to the extent of the reparations to be made. What is also clear I think, is that there will be no punishments that retrospectively affect the sporting outcomes either this year or last.

[Adam43]

Hopefully there is nothing in this.

And, if not, hopefully the FIA treat it seriously.

Whatever it is nice if it serves as a warning to stick to the rules.