2021 Cost Cap Rumours and Speculation

[Sieper]

maybe not taking the ABA is how they feel they can avoid the nightmare. Because then they can (should indeed their answer be accepted) uphold their total innocence. When admitting a small overspent this will still be admitting going over the limit and thus the nightmare continues (albeit without further impact from FIA ruling).

[Wouter]

Besides, if it were really minor (inconsequential) I'm with RZS10, they'd have either taken the ABA (which would have been small) and issue a statement about it. That would have avoided this PR nightmare they and the FIA are in now.

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If RBR thinks they're absolutely right and even under the budget cap, they'd be crazy to sign that ABA.
They are now found guilty and the car illegal by everyone without proof and it will be much worse if they sign that ABA.

[DChemTech]

Last week, I mentioned the sudden delay of the cost cap certificate distribution to be suspect especially how last minute it was. It was as if the rumors of a team going over was true and that there were behind-the-scenes negotiations going on.

Now I am thinking this too. If the breach was small, the FIA would have spoken up already. It has to be substantial enough for them to require all this time to make any sort of move.

It could just as well be the other way around. Perhaps there is a minor breach, and the FIA/team were still discussing on whether it was actually a breach at all. Then the whole affair got leaked, which forced a rushed statement blowing things out of proportions. As long as there is no clarification provided on what happened, we do not know.

It's not a rushed statement given that it was even pushed back several days to buy time.

Besides, if it were really minor (inconsequential) I'm with RZS10, they'd have either taken the ABA (which would have been small) and issue a statement about it. That would have avoided this PR nightmare they and the FIA are in now.

I don't agree that a few days pushback doesn't make it rushed - perhaps there were some essential things to fix before making a statement, but it was still much faster than without the leak. Perhaps it was to first focus on the GP at hand. Or perhaps it was neither. Again, with the currently provided information, it's all speculation. As are the reasons as to why RB did not take the ABA.

[tpe]

It's strange that people comment on what is and what isn't a breach like they actually know the regulations AND what teams submitted to the FIA's auditors...

One more thing. I don't believe for a second that FIA had last minute issues to force the delay of the announcement. They didn't want to spoil RB (or Honda's? ) party in Japan. On the other hand, I think we will never learn the amount of the breach. I am suspecting similar legal reasons as with Ferrari's undisclosed settlement .
At this point I believe that RB found more than one clever way to circumve the cost cap by some millions and going to a settlement means that every other tram will use the tricks that are acceptable.

[Big Tea]

edited in this quote for context:

How and where do you draw the line in the sand though to what gains an advantage.

I think some of it could be seen in the context of how close last year was?

Vasseur and Horner said 200k could decide championships and/or would be very important as that is one bigger upgrade, Hamilton/Merc were at 300k.

For 2021, which went down to the last race, anything with 6 digits could have made a difference as that would have been a small part, multiples of that could have been massive (let's say a new floor).

If you take 2022 (not in relation to the 2021 cap), with how far ahead RB is in the WCC and with both drivers leading the WDC, it would be hard to argue that a single item would have brought the competition so close that it would have made much of a difference.

If you look at the beginning of 2022 when the racing was close (this IS in relation to the 2021 cap) however a small improvement for Ferrari (assuming they would have capitalized) could have given them a lead that might have been hard(er) to overcome, they also might have allocated more of the 2022 budget for this year's car trying to secure the championship.

So (multiples) of 6 digits could be enough to make a difference in 2021 and/or 2022, anything with 7 digits would be huge regardless - question is whether that will/should play a role in any deliberations by the FIA's panel or the FIA when it decides about offering the ABA in the first place.

______

Another thought i haven't seen mentioned here at all which is slightly related:
if it was about an insubstantial amount of money, something no other team could reasonably argue would result in a potential advantage, would Red Bull be fighting this for the sole reason of being in the right?

Absolutely possible, of course, but more likely that they would have signed an ABA long ago and made some public statement that there was a disagreement over the inclusion of [non performance item] to the cap and that they signed the ABA to bring the matter to an end quickly for the sake of the sport ...

As someone else already wrote, some two, three or maybe even four digit amount very likely wouldn't even have been a reason not to give them the certificate in the first place, something like this would probably be swept under the rug by the FIA to avoid the fallout (especially considering some of the rumours, which of course might very well be false, that they have already conceded on some points)

So what is more likely?

RB being over marginally and refusing to accept it even though it would be the 'cleaner' solution for everyone involved.

RB being over by a substantial amount, one which arguably gave them an advantage for one or multiple seasons and would (even if not punished harshly) add an asterisk to their championships and could also hamper them down the line.
Add to this the possibility of them having used the same accounting methods for 2022, which could put them over the limit in 2022 as well if they do not fight this successfully, making them repeat offenders facing even harsher penalties as that is one of the aggravating factors.

I think the line should be drawn at $1, and anything above that accounted for in the severity of the punishment.
Passing a limit is a physical thing even if it does not measure an actual item. Beyond is beyond, as in a cliff edge.
A buffer of several thousand is probably necessary in reality, but the pass/fail has to be noted even if no action is taken.

(yes I do know $1 is not realistic, but as close as they can get to it)

[KeiKo403]

At this point I believe that RB found more than one clever way to circumve the cost cap by some millions and going to a settlement means that every other tram will use the tricks that are acceptable.

If the FIA want to creatively share what Red Bull have done they only need to propose some amendments to the financial regs and 9 out of 10 teams are capable of doing the maths

[dans79]

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

I don't know, you tell me! Also, why do you keep insisting that others think is different than Newey?

[Wouter]

At this point I believe that RB found more than one clever way to circumve the cost cap by some millions and going to a settlement means that every other tram will use the tricks that are acceptable.

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So you're accusing RBR before the FIA announced what caused them to break the BC?!
According to the rumours, the FIA accountants believe that Newey with his own company is not an employee of RBR. However, according to GAAP (Generally Accepted Accounting Principles), an independent entrepreneur with his own company IS a (possibly temporary) employee. But let's see if the FIA is right.

[dans79]

RB has a lot of baggage and the Mercedes (mainly - judged from the comments in the thread) fanbase will want them to be defenestrated, tarred and feathered for this. Maybe even put in the stocks over a cold winter evening... It should not matter, should it, but it does?

I don't see it that way, if someone cheated/broke the rules (intentionally or unintentionally) and gets caught, they should face the consequences for doing so! It doesn't matter if its a kid playing Tee-ball, a high school football team, or a billion dollar company.

[tpe]

At this point I believe that RB found more than one clever way to circumve the cost cap by some millions and going to a settlement means that every other tram will use the tricks that are acceptable.

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So you're accusing RBR before the FIA announced what caused them to break the BC?!
According to the rumours, the FIA accountants believe that Newey with his own company is not an employee of RBR. However, according to GAAP (Generally Accepted Accounting Principles), an independent entrepreneur with his own company IS a (possibly temporary) employee. But let's see if the FIA is right.

Why do you put words in my mouth?
I have no clue and actually I don't care on which "code" they overspent.

[CMSMJ1]

RB have dropped a bollock here and it irks me that the penalty will be judged predominantly (in my view) against them as RB, rather than as "a team" who ahs breached the regs. It should be as big a deal if HAAS has overspent, or if Alpine were implicated - but it is not as the FIA has allowed a tiered system of the haves and have nots.

RB has a lot of baggage and the Mercedes (mainly - judged from the comments in the thread) fanbase will want them to be defenestrated, tarred and feathered for this. Maybe even put in the stocks over a cold winter evening... It should not matter, should it, but it does?

It doesn't matter who it is - it needs to be smacked down on hard now or the whole budget cap will carry a stink going forward. The fan base, and the teams / other investors, need to have confidence that they are investing their time/money in a sport that is fairly applying the rules. A team that can get sneaky with the money side of things gets an advantage that those that are playing it straight simply can't compete against. Overspending in a budget cap environment is akin to drug taking in athletics - it's performance you can't get any other way.

In an ideal world, this is the last we hear about the budget cap other than the FIA saying each year that they're happy that the teams are all complying with it. The alternative is that every season will be tainted with "yes, but when will we find out if they cheated?" from fans of rival teams. We can't have that.

As for the accusation about Mercedes fans wanting Red Bull tarred and feathered, I think we can safely say that if the situation was reversed, the desire for retribution would be no less. Anyway, there are Ferrari fans also commenting on this thread so it's not all one way traffic.

I can't disagree - you would be right that if the shoe were on the other foot that RB guys would be wanting to see Merc team 'suffer' as a result of the breach.

I was really looking at it from my neutral perch - Agree that it needs to be smacked down on hard or else this becomes a meaningless measure.

[Wouter]

At this point I believe that RB found more than one clever way to circumve the cost cap by some millions and going to a settlement means that every other tram will use the tricks that are acceptable.

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So you're accusing RBR before the FIA announced what caused them to break the BC?!
According to the rumours, the FIA accountants believe that Newey with his own company is not an employee of RBR. However, according to GAAP (Generally Accepted Accounting Principles), an independent entrepreneur with his own company IS a (possibly temporary) employee. But let's see if the FIA is right.

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Why do you put words in my mouth?
I have no clue and actually I don't care on which "code" they overspent.

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Your own words: "At this point I believe that RB found more than one clever way to circumve the cost cap by some millions."

Who said they ( found more than one clever way to) circumvent the costcap?
RBR thinks Newey is an employee and the FIA thinks he isn't. So they have a disagreement about what an "employee" is.

[SuperCNJ]

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So you're accusing RBR before the FIA announced what caused them to break the BC?!
According to the rumours, the FIA accountants believe that Newey with his own company is not an employee of RBR. However, according to GAAP (Generally Accepted Accounting Principles), an independent entrepreneur with his own company IS a (possibly temporary) employee. But let's see if the FIA is right.

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Why do you put words in my mouth?
I have no clue and actually I don't care on which "code" they overspent.

.
Your own words: "At this point I believe that RB found more than one clever way to circumve the cost cap by some millions."

Who said they ( found more than one clever way to) circumvent the costcap?
RBR thinks Newey is an employee and the FIA thinks he isn't. So they have a disagreement about what an "employee" is.

To be fair, that's not really an "accusation" per se, tpe said "I believe" which implies that that's what he/she understands, not declaring that that's what RB did.

[Wil992]

RBR thinks Newey is an employee and the FIA thinks he isn't. So they have a disagreement about what an "employee" is.

As it stands, even this is speculation, isn’t it? I don’t think there’s been any confirmation of the overspend at all. The only actual fact is that Deloitte have said that RB have exceeded the cap by less than 7.25 million.

Edit, just to add, an additional fact is that RB dispute this.

To be honest, I’d personally be quite surprised if something as basic as whether a contractor is an employee or not was missed out of the budget cap rules, as it’s common practice in many industries. But that’s just my opinion and not worth any more than anyone else’s. I have been wrong before.

[ecapox]

We can argue here all day about who was what, when, why, where and how. Ultimately RB has two choices:

1. Accept overspend decision - This will allow them to avoid loss of constructor/driver points and only incur a financial penalty.
2. Reject overspend decision - This means that they intend to fight it and it will ultimately end up in some kind of jury decision (12 people) and if they are found guilty, loss of constructor/driver points is DEFINITELY on the table.

Basically the rules were written as, easy way is you agree and you get a slap on the wrist. Fight us and if you are found guilty, we destroy everything.

We shall see what happens. Unfortunately it is such a nuanced financial dissection. What i find interesting is that all of the teams, except one, did things "correctly." To me, that means that this should have been black and white. Who knows. We shall see.

Here is what Autosport says about RBs path.
https://www.autosport.com/f1/news/what- ... /10382816/