2016 Manor Racing F1 Team - Mercedes

[XRayF1]

For starters they now earn a significant chunk of FIA income (compared to before) thanks to their points in 2014 so any subsequent investment will go further...

Of course they get FOM's money for being 10th overall.
However, this did not prevent them going bust in 2014.
please see http://www.autosport.com/news/report.php/id/118955

So even if they got, say 10 million more due to more races etc., the rest of the spending is of my interest.

Overall, F1 budgets are confidential, but even the small teams have to budget with some 100-120 million annually.
So, while Manor/Marussia got money from 2014 in 2015 (see link, some 48 million), it did not prevent them end of 2014 to go insolvent. Meaning that even the prospect of getting FOM's money was not enough to prevent such.
Further down the line, how does this therefore equate to the current spending level?
In my head there is a gap of some 30-40 million minimum in Manor's budget ...

Xray, in 2014 they did not receive column 1 or 2 price money because they did not got to 10th place in the 2 preceding years. They only got a measily 10 million dollar column 3 price money.

In 2015 they received the 48.8 million dollar. Effectively 5 times they received in 2014.
For reference:
http://www.totalsportek.com/f1/formula-1-prize-money/" target="_blank

Your reference talks about the 2014 pay-outs, but these are actually paid in the successive year, in 2015. In 2014, Marussia got only 10 million price money.

Do note there are some differences between the autosport numbers and the totalsportek numbers. Both apply the very same reasoning, but the difference is in the projected profit on which there is a procentual turn out to the teams. However, the 10 million column 3 price money is fixed and is not procentual. Meaning Marussia effectively received 10 million in 2014, and in 2015 48,8 million (if we follow the autosport numbers).

Hmm, yes, you are right. Re FOM money.
However, it still does not feel right from my (managerial) POV.

My logic.
Manor gets 10m in 2014 and goes insolvent. Has to lay off a lot if not all people, plus infrastructure/factory due to funding problems. Manor MR03 is an aero model only, and bought off.
Why did they have to do it?
Everybody knew that because of Caterham's demise from F1 in 2014, Manor would get column 1+2 money in 2015, meaning, as you rightfully stated, a lot more money.
Which would have meant that Manor could have go on as they were (with no competition for the 10th slot), and pay off (in my mind) a significant portion of their debt in 2015. Correct so far?
If so, why go into insolvency at all?

My second mental 'challenge'.
In 2014 they only got 10m - and went into insolvency.
Resurrected, 2015 they got some 50m.
In 2016 they will perhaps get a little bit more because of XYZ (sponsoring, etc - please fill in, it is just an assumption to spin it positively) - say, 10m.
So from 2015 to 2016, Manor is only able to increase their budget by 10m (to the outside) plus the savings they get off 2015 for not producing a complete new F1 car.
While I do not know, what kind of money we are talking for producing a new car, it must be in the multi millions. Again, my assumption is 20m.
So together with the assumed 10m, we are at 30m total of budget available for the new car.

My question, though - is this really enough?
This in light of my earlier posts (e.g. securing the Merc engine deal, the Williams deal, bringing in a lot of new highly qualified people, new infrastructure).

[turbof1]

The main issue is that they were pushed into insolvency. Creditors went to court and those sent baillifs to seize belongings. There's certainly an argue to be made that the creditors could have waited, but also understand that it was several months between when the issues started and when Marussia would be paid. For the full record: the teams do not get the money in one go, but are being paid monthly, and only when the season is underway. I think the creditors faced serious cash flow issues due delayed payment and had to push for liquidation of Marussia's assets.

I wouldn't make too many assumptions about their current budget, simply because we don't know what the effort of their current backer is. Fitzpatrick is truly a mistery on that front, with the only info that he saved the team. Also, I think the budgettary impact of their drivers will be around 20m positive. Wehrlein alone is rumored to be 7m as a combination of direct financial backing and price reduction the PUs. They are now looking to milk around 15m for the second seat.

It certainly will be very challenging for them to make ends meet, but on the upside they have a surprisingly attractive package. I'd say more attractive then Sauber.

[bhall II]

[...]

At the start of the year, the team was rescued from administration by Fitzpatrick. He had to pay a very modest amount to the administrator to get the team, around £500,000.

It meant Manor emerged from the ashes basically free of debt, and thus in a much better position than many teams that still owe a lot of money.

The appeal to F1 fan Fitzpatrick was obvious. Manor had qualified for approximately $50m per year of "Bernie money" from the FOM prize fund by finishing in the top 10 two years in a row.

Next year the field expands to 11 teams, but Haas won't be able to bump Manor out of its current position in the financial pecking order until 2018. So Manor will earn that $50m in 2015, 2016 and 2017.

It's a significant amount, but far from enough to run a season even for a lean and mean outfit like Manor - even using old equipment.

There's been some income from sponsors (Roberto Merhi drove for free), but sources suggest that Fitzpatrick himself has put only a relatively modest amount of extra funding into the pot. He may be a wealthy businessman, but he doesn't have the sort of money to sustain the team.

It's no secret that the strategy of Fitzpatrick and Boulsien have been to turn a profit by selling the team on at the right time.

With no debt, $100m guaranteed from Ecclestone over the next two seasons, and the Mercedes and Williams contracts done, they have a very attractive package – and it would appear that they believe they can sell for a good price.

[...]

[nevill3]

I thought I had read that Manor was pushed into insolvency because their Russian backers pulled the plug and left them seriously short of funds midway through the season (After Russian Grand Prix I think). Some of their creditors had been stung by Caterhams demise and were wary of losing out a second time in as many years.

[Scuderia1967]

I thought I had read that Manor was pushed into insolvency because their Russian backers pulled the plug and left them seriously short of funds midway through the season (After Russian Grand Prix I think). Some of their creditors had been stung by Caterhams demise and were wary of losing out a second time in as many years.

True. Marussia (the road cars branch, I mean) was closed in April 2014.

[XRayF1]

I thought I had read that Manor was pushed into insolvency because their Russian backers pulled the plug and left them seriously short of funds midway through the season (After Russian Grand Prix I think). Some of their creditors had been stung by Caterhams demise and were wary of losing out a second time in as many years.

True. Marussia (the road cars branch, I mean) was closed in April 2014.

You are both correct, of course.

What I cannot wrap my head around is that usually a serious prospect of payments (in this case coming from FOM), even if done in lots according to a payment plan rather than lump sum, persuades a creditor to not force the debtor into insolvency. Because forcing someone into insolvency and auctioning off his assets, actually deprives the creditor from any chance getting all his money back.
Insolvency pay off means only small payments in percentage of the amount given - usually in the range of 10-40%, and the 500,000 do sound being a lot less even the 10%.

[nevill3]

I agree but the payments would only have been made if Manor survived to compete in 2015, which they very nearly did not.

[turbof1]

I thought I had read that Manor was pushed into insolvency because their Russian backers pulled the plug and left them seriously short of funds midway through the season (After Russian Grand Prix I think). Some of their creditors had been stung by Caterhams demise and were wary of losing out a second time in as many years.

True. Marussia (the road cars branch, I mean) was closed in April 2014.

You are both correct, of course.

What I cannot wrap my head around is that usually a serious prospect of payments (in this case coming from FOM), even if done in lots according to a payment plan rather than lump sum, persuades a creditor to not force the debtor into insolvency. Because forcing someone into insolvency and auctioning off his assets, actually deprives the creditor from any chance getting all his money back.
Insolvency pay off means only small payments in percentage of the amount given - usually in the range of 10-40%, and the 500,000 do sound being a lot less even the 10%.

It depends. The creditors will have creditors themselves to pay off, and will likely have had cash flow issues (which is by nature already a big issue in F1 since teams usually pay way too late). They might also like to use it as a statement towards even other teams: if you don't pay up in time, we will try to push you into insolvency. Force India for instance had to deal with this, pay off their creditors early and postpone their B-spec car.

In the case of Marussia it might have not been that wise, but in the grand picture Marussia is just one debtor. writing off 90% of what Marussia owed, might have been worth it if it forced the other creditors to pay early. I definitely think either way it is a case of cash flow.

[NathanOlder]

http://www.telegraph.co.uk/sport/motors ... 0295/.html

According to the Telegraph , Rio Haryanto has secured the drive in the 2nd Manor. Crazy how someone who hardly performed in GP2 has gor into F1. Just like Chilton did.

[nevill3]

Manor are certainly looking forwards this year, with the extra money they appear to have they have advertised many jobs on their website. Anyone on here looking to enter the F1 fraternity should look here....

https://manorracing.wordpress.com/jobs-board/

I think I qualify for the Van Driver/Stores person but live far too far away to commute.

[cbbcisace]

There will be a press conference at 15.30 local time // 08.30am GMT tomorrow morning at the Pertamina offices for the Rio Haryanto annoucement.

[NathanOlder]

When ? Tomorrow ?

[cbbcisace]

When ? Tomorrow ?

Yes sorry tomorrow morning.

[superdowg316]

Haryanto has been unofficially confirmed by Autosport as the second Manor driver for 2016.

http://www.autosport.com/news/report.php/id/122841

[Thunder]

It's official. https://twitter.com/ManorRacing/status/ ... 2911581185