Motorsports Business: Manufacturers in F1 - By guest writer Red Andy

Editor's Note: This is an archive article and was originally published on August 23^rd 2007 on The Pit Lane Forum. http://the-pit-lane.co.uk/index.php?showtopic=6790

 

 

One of the biggest changes to have struck Formula One in recent years is the increasing involvement of major car manufacturers in the sport. Although several manufacturers had participated in the sport with works teams in the past, by the 1990s most had withdrawn again. To begin with in this period, car manufacturers would supply engines to teams, and possibly provide limited technical expertise - the dominant partnerships of McLaren and Honda in the late 1980s, and Williams and Renault in the 1990s were forged on this basis.

Since then, however, things have changed slightly. Mercedes formed their long-term partnership with McLaren in 1996, and within a few years, other manufacturers would follow. Renault, having left the sport at the end of 1997, returned in 2001 with the intention of buying out the Benetton team. BMW joined forces with Williams in 2000, and Toyota began their own works team in 2002. Honda had initially planned to enter the sport as a works outfit in 2000, but following the death of Harvey Postlethwaite the plan was axed, and instead they chose to supply engines to both Jordan and BAR teams, eventually abandoning Jordan and forging a closer partnership with BAR. By 2005, they had bought out the whole team.

Of the team-manufacturer partnerships, only one has so far faltered: that between Williams and BMW. Frustrated that Williams refused to allow them to input on chassis development, BMW bought out the Sauber team in 2005, with the Williams contract not renewed after the end of the season. As such, we now have six manufacturer teams in F1: McLaren-Mercedes, Toyota, BMW Sauber, Renault, Honda and Ferrari, who have participated in the sport since its inception and remained the only consistent manufacturer entry. Using the immense influence of the now-defunct Grand Prix Manufacturers' Association (GPMA), the manufacturer teams (excluding Ferrari) pushed for rule changes to "cut the costs" of competing in Formula One, a thinly veiled euphemism for overlapping the development costs of F1 projects with the manufacturers' road car projects. This "road relevance" scheme has become an increasingly dominant theme in the discussion of the future direction of F1.

The most radical changes yet have been proposed in the FIA's "Framework for Discussion" of prospective regulations, to be canonised in the 2011 editions of the F1 Technical and Sporting Regulations. The proposed rules promise an even greater overlap between F1 and road car development, with major changes to several areas, designed to increase the road relevance of Formula One.

Although manufacturer participation in the sport allows a sound financial basis on which to build, is the increasing influence of manufacturers in the way F1 is run really such a good idea? FIA President Max Mosley has stated on multiple occasions that one of his key aims is to cut the cost of competing in Formula One, to encourage smaller teams to enter. However, his proposed regulations for 2011 run counter to these assertions: although they may result in reducing overall overheads for major car manufacturers, they will increase astronomically the costs of privateer outfits with no road car division. The implicit aim of the regulations seems to be a sport even more dominated by manufacturers than it is at present.

Furthermore, we have seen in the past that manufacturer involvement in Formula One is cyclical, and correlates strongly to the strength of the worldwide motoring market. If the global market takes a downturn in the future, car manufacturers will be forced to cut back on unnecessary expenditure in order to preserve their profit margins: and, in such a case, their racing exploits will be the first things to go. If such an instance hits F1 at the height of manufacturer influence, with a set of rules accommodating none other than manufacturer teams, the consequences for F1 could be catastrophic.

Most importantly for the casual racing fan is the adverse effects manufacturer involvement has, and will continue to have, on the quality of on-track racing seen in Formula One. Proposed regulation changes to restrict aerodynamics, for example, in order to decrease reliance on aerodynamic grip and hopefully encourage overtaking, have been uncompromisingly opposed by the manufacturer teams. Moreover, the manufacturers wish to introduce into their F1 programmes a whole host of driver aids, which, although very useful to the casual driver on the road, stand a very real chance of undermining the input of the driver in a Formula One car, which in turn damages the actual racing.

Perhaps what is most concerning about all of these arguments is that they are not new: they have been used many times before, for several years. In fact, for a long time one of their most vocal proponents was none other than Max Mosley, who cautioned against the overbearing influence of manufacturers many times during the height of the conflict between the FIA and the GPMA.

However, since the GPMA disbanded, we have seen a profound U-turn in Mosley's ideas concerning manufacturers in Formula One. The proposed 2011 regulations demonstrate nothing more than an increasing focus on short-term business gains, and a decreasing focus on the on-track racing that we tune into F1 for. What is needed now is a new direction, an uncompromising stance warning manufacturers that they can participate in the sport, but they must take it as they find it, not as they wish it to be.

Comments

[flood1]

This is a very good analysis of the sport as it existed in 2007 vis a vis the proposed rules. Andy rightly concludes that poor road car markets are to come and concludes that manufacturers will bail out of the sport leaving those left to deal with the changes the manufacturers demanded.

The rules have changed somewhat from what was then proposed, but the manufacturers subsequently oppossed the suggested rules that would have lowered the costs and allowed tecnological innovation and possibly saved their asses.

The car markets did implode and the manufacturers called in their chips.

It was predictable and it was predicted. Andy did so and many of us agreed.

I think this may be bad for the short term but good in the long term. I certainly hope so.

[Paul_Murtagh]

It is a very good analysis, and the fact that it was published two years ago and still be relevant today is a good indicator.

What is interesting from Andy's reflection is that the car manufacturers never learn from their past. Renault have entered and left the sport twice already and look like doing it for a third time, and Honda have in fact done this three times.

[sportsman]

It's good article, inasmuch as it accurately reflects the recent past.
But I would question some of the the conclusions.
F1 or as was in history GP racing was essentially formed by manufacturers for them to showcase their cars.
Louis and Marcel Renault formed the Renault car company, simply to race.
That was in 1894.
So to say manufacturers never learn is erroneous.