2021 Cost Cap Rumours and Speculation

[dans79]

if he is doing any kind of design/development/management/mentoring, he is is benefiting the company.

It doesn't matter if it's direct, indirect, work that effects the near future, or work that affects the company 5 years down the rode.

Nice try but no. He was on gardening-leave. That usually means you aren't doing anything important.

That would still be the team's issue though isn't it? They have him on employment so if they fail to utilize him (and his cost) it's their decision. However, this is done to ensure other teams don't get him right away so it is still a beneficial cost to the team.

Exactly, Gardening leave is The Choice of the current employer to ensure that another team doesn't benefit from the employees skills/knowledge.

The FIA might be OK with you shunting him off into some other less important department, but they're not gonna be OK with you trying to write-off his salary.

[ispano6]

if he is doing any kind of design/development/management/mentoring, he is is benefiting the company.

It doesn't matter if it's direct, indirect, work that effects the near future, or work that affects the company 5 years down the rode.

Nice try but no. He was on gardening-leave. That usually means you aren't doing anything important.

That would still be the team's issue though isn't it? They have him on employment so if they fail to utilize him (and his cost) it's their decision. However, this is done to ensure other teams don't get him right away so it is still a beneficial cost to the team.

It's a lose-lose situation, no doubt. The individual has already picked his side, and his old clan has brandished him a traitor, spy, mole or what have you. Could Red Bull have seen his departure coming? Maybe. Could they have predicted that they would need to re-build Max's car that was a complete loss after Silverstone? It's convenient for people to say "well they should have accounted for it", but that won't ever sit with me sorry. Money is money, costs are costs, no two ways to look about it. Since no one here actually knows the amount of the minor breach, we can't know if these unforeseen costs make up a majority or fraction of it. Some here obviously will assume the breach is the full 4.99% within the 5% minor breach range, I get it.

That would still be the team's issue though isn't it?
So by this logic, if Max or Sergio took Hamilton out enough times last year to secure the championship, that's Mercedes' problem, isn't it?

[mendis]

They have significantly underspent if this is the case. 6 million unused would be big!

I find that highly unlikely and laughable, as that would mean huge amours of performance were left on the table!

If it was me a lot of heads would role if that much performance was left untapped!

Indeed. If we go back and examine some facts its just so unlikely they under spent.

-They brought more upgrades than any other team in 2021.
-They are still updating the car more tgan others in 2022.
-Horner has been pretty vocal this year in expressing his displeasure with the current cost cap and is effectively lobbying to have it increased.

So there is no way in hell they are spending less than other teams. Indeed a truly laughable take.

Also not including neweys salary and trying to say he had nothing to do with the car is nonsensical. The rb18 is widely seen as a newey creation. If rbr really tried to make it seem that he had nothing to do with the performance of the car then that was a dumb decision. But i dont necessarily believe that is tge case and its likely just wild speculation at this point. We need to hear the official truth.

The post sums up the view of how to passionately dislike a team. Bringing more upgrades doesn't necessarily mean spending more.
They are still upgrading probably because they didn't destroy their chassis and engines like other runners did?
There is more truth to it than just, "my feeling".
About Newey's part, that whole piece there is competely wrong. It shows you didn't really read what is the issue here.

[ispano6]

The post sums up the view of how to passionately dislike a team. Bringing more upgrades doesn't necessarily mean spending more.
They are still upgrading probably because they didn't destroy their chassis and engines like other runners did?
There is more truth to it than just, "my feeling".
About Newey's part, that whole piece there is competely wrong. It shows you didn't really read what is the issue here.

Right? Toto's close ties with the FIA seem to benefit him in that his interpretations are acceptable but RedBull's isn't.
Toto considers upgrades that come off the truck as being included in the cost cap, if it isn't taken off the truck because it was proven to be a dud in the wind-tunnel, then it doesn't count toward the cap? Of course we can only go by what people are purported quoted to have said, instead of actually hearing it from horses mouth.

[mendis]

if he is doing any kind of design/development/management/mentoring, he is is benefiting the company.

It doesn't matter if it's direct, indirect, work that effects the near future, or work that affects the company 5 years down the rode.

Nice try but no. He was on gardening-leave. That usually means you aren't doing anything important.

That would still be the team's issue though isn't it? They have him on employment so if they fail to utilize him (and his cost) it's their decision. However, this is done to ensure other teams don't get him right away so it is still a beneficial cost to the team.

I already mentioned it. Like in Fallow's case, the employee on gardening leave can be moved to a non F1 project to avoid the cost on F1 program.

[dans79]

Nice try but no. He was on gardening-leave. That usually means you aren't doing anything important.

That would still be the team's issue though isn't it? They have him on employment so if they fail to utilize him (and his cost) it's their decision. However, this is done to ensure other teams don't get him right away so it is still a beneficial cost to the team.

I already mentioned it. Like in Fallow's case, the employee on gardening leave can be moved to a non F1 project to avoid the cost on F1 program.

I don't think the FIA is going to agree with that, that makes it far to east to manipulate the cost cap.

[mendis]

That would still be the team's issue though isn't it? They have him on employment so if they fail to utilize him (and his cost) it's their decision. However, this is done to ensure other teams don't get him right away so it is still a beneficial cost to the team.

I already mentioned it. Like in Fallow's case, the employee on gardening leave can be moved to a non F1 project to avoid the cost on F1 program.

I don't think the FIA is going to agree with that, that makes it far to east to manipulate the cost cap.

FIA rules doesn't govern the internal movement of employees in a team. Their concern is the overall spend.

[ispano6]

That would still be the team's issue though isn't it? They have him on employment so if they fail to utilize him (and his cost) it's their decision. However, this is done to ensure other teams don't get him right away so it is still a beneficial cost to the team.

I already mentioned it. Like in Fallow's case, the employee on gardening leave can be moved to a non F1 project to avoid the cost on F1 program.

I don't think the FIA is going to agree with that, that makes it far to east to manipulate the cost cap.

What was/is James Allison's salary and why isn't he part of the cost cap? How is this different to Newey?

From Dieter Rencken's article:
https://racingnews365.com/analysis-how- ... s-cost-cap

Mercedes founded its so-called Applied Sciences division which, for example, consulted to sponsor INEOS's America’s Cup entry Britannia - technical lead is the F1 team's former Technical Director James Allison - while Red Bull's equivalent trades as Advanced Technologies and recently engineered the RB17 hypercar.
..
These additional controls forced Mercedes to expand support departments such as Finance and HR, resulting in a reported headcount 10 percent growth from 157 to 173 – but, crucially, being non-racing activities, such costs are excluded from the cost cap. The net effect is overall headcounts fell from 1063 to 1004, or five per cent - plus Mercedes gained its Applied Sciences division as a bonus – despite the growth in non-racing headcount.
...

You then have a quote by Allison in 2022, seemingly very much involved:

“A race is over 50+ laps and having a car that’s competitive on all of those gives you opportunities and we’ve typically been able to move back forward through the race into a strong position. That said, we’d obviously prefer to be more competitive in qualifying,” Allison said in Mercedes’ post-France debrief.

“Some tracks like Budapest will cause us issues and we need to make sure we are really there or thereabouts to make sure we don’t have a number of other teams between ourselves and Ferrari and Red Bull.

“In terms of the upgrades themselves, yes, they are incremental steps, they are small steps that were added to the car, but the important point is we have plans to introduce far, far more across the races that follow.

“We won’t be able in one go just to catch up and be with Ferrari and Red Bull. But hopefully, as you have seen across the season so far, we are incrementally closing that gap down and we have more to come.”

In a separate interview in April 2021:

“I didn’t imagine that there would be a space for me in the team, having relinquished this brilliant job. Happily, Toto saw it a little differently. And between us we worked on the manner in which I could contribute to the team.”

[selvam_e2002]

Better scrape the cost cap. It does not make any sense in F1 now a days. Ferrari and RB going to get new PU in USA GP(is it 6 or 7th). however FIA said only 3, who is going to pay for new PU? It is team right.

The other teams apart from top 3 never going to spend full Budge cap. They always save money and they cannot compete to top 3 teams in any means.

My suggestion would be scrape the budge cap. else next year we will have different team caught with same breaches and pay penalty as some $$ and get out of it. It is not look good.

[mendis]

Better scrape the cost cap. It does not make any sense in F1 now a days. Ferrari and RB going to get new PU in USA GP(is it 6 or 7th). however FIA said only 3, who is going to pay for new PU? It is team right.

The other teams apart from top 3 never going to spend full Budge cap. They always save money and they cannot compete to top 3 teams in any means.

My suggestion would be scrape the budge cap. else next year we will have different team caught with same breaches and pay penalty as some $$ and get out of it. It is not look good.

Cost cap has brought in with a multitude of intentions. One of those, was to provide an equal opportunity for midfield and backmarker teams to compete with their budget. Second is to make F1 teams profitable and the biggest one is to draw more automobile manufacturers to the sport.

When the cost cap was introduced, I am sure nobody in FIA or teams would have ignored the possibilities of cost cap breaches via difference of interpretations, or exploitation of grey area, definitely not for the first couple of years. Like every new governance procedures, this one also has to evolve to become water tight. I don't think what we are seeing is totally unexpected. We live in an age of multimedia where every damn thing becomes a sensation and gets amplified by the clickbait journalism. I don't think cost cap is going away and I don't think it should.

[bluechris]

When the cost cap was introduced, I am sure nobody in FIA or teams would have ignored the possibilities of cost cap breaches via difference of interpretations, or exploitation of grey area, definitely not for the first couple of years. Like every new governance procedures, this one also has to evolve to become water tight. I don't think what we are seeing is totally unexpected. We live in an age of multimedia where every damn thing becomes a sensation and gets amplified by the clickbait journalism. I don't think cost cap is going away and I don't think it should.

So lets leave anything unpunished because it needs to mature? thats your opinion? i respect it but my opinion is that because of what you say exactly the teams didn't try too hard to police themselves because they knew that the punishment logically would had been light. We have also words from RB that they will not stop upgrading the car no matter the cost cap or anything if i remember right.

I dont agree off course and there must be real punishment no matter where the expenses was. Its also a nice trick to let the catering for example to be over budget (if this is really the case here) or something that in all eyes doesn't seem crucial but what you all forget is that the money that left from catering went to something else more crucial....

I dont like any team manager, especially Toto but what he says is right. With some extra millions they could had won the last year championship or this year they could had done a faster job to fix their car.

[Stu]

Teams A,B,C,D & E all take into account the portion of salary for the entire race-team from the summer shutdown (where work of any kind is specifically prohibited by the FIA - including responding to emails…); meanwhile Team G exclude it from the cap as they interpret it as a compelled spend by the FIA that has nothing to do with racing or performance.

My opinion? Still wrong, but the kind of loophole that could be deliberately subverted. We all know that the difference between a ‘good’ accountant and a ‘bad’ accountant is the ability to find and use loopholes such as that to a companies benefit.


Edit:
Another item that would be open to interpretation would be Adrian Newley’s absence for a “significant period of time” during 2021 due to his accident, this incident became widely reported on his return at the Turkish GP.

There are many points that are open to interpretation, there are various items that are exempted from the cost cap.

There needs to be transparency in these reports from the FIA (if not with the public, then certainly for the teams), otherwise more breaches will occur in the future.

Personally, I would put money in a few of the teams being very (VERY!) close to the cap!

[Stu]

Seems a weird choice though, it makes me wonder who their three nominated salary exclusions are from the cost cap?

Horner, presumably, would be one.
Marco is employed by RedBull (as opposed to RedBull F1 Team).

The company's directors are Mateschitz, Marko and Horner. On the account submitted to Companies House, that is.

Interesting, but who are the nominated trio of salary exclusions?
Being a director does not compel them to be employed by the company.

[ArcticWolfie]

Teams A,B,C,D & E all take into account the portion of salary for the entire race-team from the summer shutdown (where work of any kind is specifically prohibited by the FIA - including responding to emails…); meanwhile Team G exclude it from the cap as they interpret it as a compelled spend by the FIA that has nothing to do with racing or performance.

My opinion? Still wrong, but the kind of loophole that could be deliberately subverted. We all know that the difference between a ‘good’ accountant and a ‘bad’ accountant is the ability to find and use loopholes such as that to a companies benefit.

Exactly... I used to work for a contractor and it was pure game to find "loopholes" in the contracts (the government in my situation) to get the best bid, if you wanted to win anyway.
Most profit went into finding written parts which you could interpret in 2-ways. Even when it came down to a lawsuit most were settled in favor of the contractor or "worst"-case 50/50.

[littlebigcat]

From Dieter Rencken's article:
https://racingnews365.com/analysis-how- ... s-cost-cap

Mercedes founded its so-called Applied Sciences division which, for example, consulted to sponsor INEOS's America’s Cup entry Britannia - technical lead is the F1 team's former Technical Director James Allison - while Red Bull's equivalent trades as Advanced Technologies and recently engineered the RB17 hypercar.

Except having looked at the filled accounts, that with Red Bull Racing having only 59 employees compared to RBAP with almost a thousand, Mercedes AP division is something completely different.

Red Bull Advanced Technology appears to be where all of the car development and manufacturing is done for Red Bull.