How Formula One's New Cost Cap Could Benefit the Richest Teams – RoadandTrack.com


Australian F1 Grand Prix - Qualifying

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The idea behind the cost cap for the 2021 Formula One season is a noble one. The current F1 grid is two-tiered, with only three teams seriously competing. In fact, no team other than Mercedes, Ferrari, or Red Bull has won a Grand Prix since Kimi Raikkonen drove his Lotus to victory in the 2013 Australian Grand Prix.

A large part of the two-tiered nature comes from the insane amounts of money that Mercedes, Ferrari, and Red Bull are willing to spend to win. Smaller teams, without the same pedigree or lucrative side businesses, can’t afford to develop a winning car. Since they aren’t winning, they don’t make as much in sponsorships or prizes, so they can’t invest as much in their next car. It’s a cycle that’s hard to break.

Capping how much teams spend is certainly a good way to narrow the gap, but there’s a problem. The cost cap doesn’t go into effect until 2021 and we already know the rule changes for that season. That means that, if they want, teams can just develop their 2021 cars during the 2020 season and avoid the effects of the $175 million cost cap.

Of course, any team can theoretically do that. It’s not a direct disadvantage for smaller teams. But not all teams can afford to develop both a 2020 car and a 2021 car during the same season, while the big three shouldn’t have a problem doing just that.

Some teams have done parallel developments in the past to account for uncertainty in final rules, so it’s within reach. For second-tier teams, though, it’ll be hard to stay competitive in 2020 if they want to set aside and personnel to get an early jump on their cars for 2021.

In an interview with Motorsport.com, Renault team boss Cyril Abiteboul said that the team might have to stop work early on its 2020 car in order to try to develop a competitive car for 2021. Since they’re not starting with the fastest car, they’d likely have to spend more than top-tier teams to catch up.

Those top-tier teams can also have advance teams working on the 2021 car while still putting a full effort into development for 2020. That’s what Red Bull is doing, making 2020 a particularly pricey year for the team.

“It makes it an incredibly expensive year because we are developing under two types of regs and before the new financial cap comes in as well,” Red Bull team boss Christian Horner told Motorsport.com.

“So 2020 will be an expensive and busy year, certainly off track and on track.”

The teams that can afford an extremely expensive development year upfront are sure to be handsomely rewarded. Because once you get a head start, the cost cap means that nobody can outspend you to catch up.

If everyone is spending a the same amount of money every year starting in 2021, burning through as much cash as possible to start from a high point is the best way to guarantee continued success. And since some teams likely won’t be able to swing $175 million every season, we wouldn’t be surprised if a few remain far behind the three high rollers.


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