Formula 1’s budget cap will start at $145 million next year, but there is as yet no agreement on how much it will be reduced in the future, said Ross Brawn, F1’s managing director of motorsports.
The F1 teams have been disagreeing over the final figure for 2021 in recent weeks, through numerous meetings to discuss cost savings in the wake of the COVID-19 pandemic. While many midfield teams wanted the $145m figure lower for next year, Brawn explained that any reductions will have to come in following years.
“Details will be going out to the teams in the next few days,” Brawn told Sky Sports. “There’s been a lot of consultation and I think we’re now at the very final stages; so it will all become clear shortly.
“The budget cap’s initial objectives were a more competitive field. (But) with the situation we have now, sustainability – the economic sustainability – of Formula 1 is the priority. And I think that counts as much for the big teams as it does for the small teams.
“(The message) is clear from the people who stand above some of the principals and management of these teams: We’ve got to cut costs.
“We started at $175m and it was a long battle to get it there. With the current crisis, we’re now going to start at $145m. The question really is how much further down can we drive (the cap) over the next few years?”
Brawn said new commercial agreements will see smaller teams getting a more equal distribution of F1’s revenues, with a goal of the midfield teams being able to target podiums and the odd surprise win. While he believes such a scenario will give the sport a bright future, he says it’s imperative all of the teams survive the current crisis to see it, something Liberty Media is working to ensure by advancing certain payments following a restructuring of its investments.
“We’ll judge on what level we should support the prize fund in the next 6-12 months, because obviously, we want to keep (teams) alive. If we lose some teams in this period, it will be a tragedy. So we’re working very hard in a fair and equitable way among the teams.
“Liberty has shown its strength and created this fighting fund … and we just need to see now how things develop. All the teams are effectively in lockdown — FIA lockdown as well (government) lockdowns — and that’s in place until the end of May.
“We need to look at the calendar, look at what the income will be like for the rest of the season, and then sit down with the teams and see how we can find a way of making sure we all continue on this journey. Because the future looks so good: We’ve got 10 very good teams in Formula 1; let’s keep it that way.”