Ecclestone: Ferrari threat is real if regulations prevent winning

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Photo by: www.kymillman.com/f1

The last time Ferrari threatened to leave the sport, Formula 1 was led by a different leader in the form of Bernie Ecclestone. He negotiated a bipartite agreement with the teams and then another with the FIA and this was a bit of a departure from the old Concorde Agreement which was a tripartite agreement between commercial right’s owners, the FIA and the teams.

To assuage teams from leaving, Ecclestone did new deals that, if memory serves correctly, expire in 2020. The FIA also did a new regulation package for 2014 that included hybrid V6 turbo engines because Mercedes and Renault threatened to leave the sport if the changes weren’t made for more road-relevant hybrid technology.

Many fans are quick to say buh-bye to Ferrari but there wasn’t the same level of dismissal when Mercedes or Renault threatened to leave. Neither of those teams have been in the series since 1950 and I think you have to give some credit for Ferrari’s commitment to F1.

Last week, the new 2021 engine regulations were floated to the public and while they were purposefully light on detail, they did give Mercedes, Renault and Ferrari reason or pause. These manufacturers are heavily invested in the current engine format and are not keen to see it change. Now this is interesting as the regulations have always…well, changed.

The sport has gone from V12’s to V10’s to V8’s and now V6 hybrids and if memory serves correctly, the original intent of the 2014 regulation changes was for a 4-cylinder hybrid but Ferrari had a major issue with that. Ferrari weren’t keen on the hybrid engine to begin with but at the time, it was being led by Luca di Montezemolo and now Sergio Marchionne is in charge and he’s a Fiat guy who has a much stronger road-relevance DNA than Luca did.

Now that the regulations are suggesting another engine change, the top three engine makers are having serious concerns and Ferrari have threatened to leave the sport…again. It seems all three are augured in on this current specification and yet it is this very spec that fans are not resonating with—at least not a majority of them.

It is perplexing but I understand Ferrari’s new love for hybrid given Sergio’s Fiat and Chrysler ambitions and the massive investment they’ve made. This massive investment in the current engine spec has bankrupted three teams already so for Mercedes boss Toto Wolff, the high R&D has already been covered and now the engine supply contracts should be much cheaper. I bet Force India and Williams would like to know exactly when this big price reduction from Toto will be coming across their desk.

What would the last guy to face a Ferrari threat have to say about the current threat? The Independent caught up with Ecclestone to see:

“If they can’t win, they will put forward new regulations,” he says. “If the regulations come out where Ferrari think it is going to be a struggle and they can’t support the money then they will leave.”

To be honest, I’m not one to play chicken with the largest marque in F1 and while other fans say good riddance, don’t let the door hit you, I tend to offer the same argument I did defending Red Bull’s threat to leave over a lack of a competitive engine supply. Ferrari are much, much bigger than you think they are and spend hundreds of millions in F1. Without Ferrari, there would be a massive hole in the sport. That’s not good even if you hate Ferrari and I am still not convinced Red Bull is in this for the long term beyond 2020 with all the Aston Martin mumbling.

This isn’t about the spending cap or capping what Mercedes, Renault and Ferrari spend. I understand Ross Brawn’s comment about manufacturers asking him to help them stop spending so much but F1 is not a cheap sport if you want to win.

“They don’t want budget caps and all that,” says Ecclestone. “They want to spend what they can afford to spend and I’ve always said the same thing. If people can’t spend they have to go. If there are then only three or four teams something would have to be done but until that actually happens nobody is going to do anything. All the teams that say they can’t afford it shouldn’t put an entry in.”

We all know that if they save money because they cancel testing, that money will just be used in other areas of their program. An argument could be made, however, on engine supply costs. I think that’s a tangible example of parts that can be reduced allowing for more spend on chassis for a more competitive car.

I’m not sure if Ferrari would leave or not but it is tough situation Liberty Media are in and this is just the beginning. Mr. E had a knack for getting deals done good or bad. This is the first major hurdle Liberty Media will face to protect their investment. All the little things they’ve been doing this season for social media, YouTube and other content are fine but just the tip of the iceberg. Getting Ferrari, Mercedes, Renault and Honda to the table and preventing any of the from leaving and also changing an engine spec that fans don’t like and aren’t resonating with is another issue altogether.

Hat Tip: Independent

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GraphicDough

I am one to say good riddance to them if they go. What is a sport if there are only two player on the field to win. And sorry this is akin to child taking his ball home when someone is better than them. I felt the same way when Red Bull threatened to quit. I don’t agree with all that Liberty Media is doing, but I’d rather see co-operating among the teams to make a fair (or even mildly fair) racing series. I began my interest in F1 because it was a venue for technology, skill, and pure luck.… Read more »

Negative Camber

Just curious, were you of the same feeling when Merc and Renault threatened to leave if they didn’t change 2014 engine spec to hybrid?

Salvu Borg

But back then that was Renault and Mercedes which are good and not FERRARI. In this latest controversy pushed out by Liberty re the new for 2021 engine rules the first to come out commenting was Mercedes, results= headlined on a lot of F1 sites but next to nil comments by people following said sites. The second to come out commenting was Renault the, results= same as to Mercedes comments. The third was FERRARI, Results= all hell breaks loose against FERRARI on comments board, FERRARI are bad, the most bad, evil, the one and only problem of F1. Such is… Read more »

GraphicDough

I think it’s difficult to point the finger only at Ferrari in this circumstance. As your list, and other commenters show, it is/has been done by all the teams.

p1ngu

The only ones threatening to leave at the moment are Ferrari. As and when the others do the same, they’ll attract criticism.

As for envy of Ferrari? Who’d be envious of a team which, even with the deck tilted firmly in its favour, can’t win?

GraphicDough

Yes. This kind of threat from anyone is a childish move and only show’s their own self interest and not in the growth of the sport. While they may not agree to what the changes are, there are other things that can be done to have a voice. They do not seem to be interest in doing this though. There are a lot of problems in Formula 1 at the moment and it’s sad that most of them aren’t about having better racing. It seems to be focused more on who has what and making veiled threats like this one.… Read more »

stevewf1

I remember reading a quote from Roberto Guerrero in his early days in F1 with the Ensign Team. Speaking about the top guys, it went something like “I can’t believe we’re in the same race as them”. F1 has always been about spending money and in its history, the richer teams have been the top teams. Always been that way. The problem with Ferrari is they have trouble being competitive at the very top with the massive amounts they do spend. If your neighbor lands a job that pays twice as much as your job, is that fair? Should the… Read more »

p1ngu

The correct analogy would be that your neighbour got paid a great deal more than you for the same job, but didn’t do it as well. Most people would want to see that equalled out, no?

Sakae

Good to read description of current situation. Thanks.

Salvu Borg

After buying the F1 commercial rights for 3.7b from CVC Liberty has fooled many people into relaxation mode, their honeymoon is now over. What Liberty is pushing out is nothing new, in fact it is the same exact thing that had been pushed out by the back than MR F1 and his FIA managing buddy, neither is the scope behind the push any different, it is all about a power struggle, a power which will permit the milking of F1 to the fullest possible. But this time the FIA management is not on their side of doing things, in fact… Read more »

p1ngu

I’m struggling to understand your point entirely, but bear in mind that the reason we’re in this situation is because the commercial rights were acquired for a (relative) pittance by Bernie, who then sold on to CVC, with Liberty now acquiring them. You’ve mentioned the ‘milking’ of F1, but this is a commercial enterprise rather than some sort of charity, so what would you expect? Liberty have paid a good deal of money and have to deliver a return. Their view is that the key to F1 success is a relatively stable number of teams (which needs a more equitable… Read more »

Salvu Borg

Your struggles to understand is your problem and not mine. as are confused wordings and reasoning/s.

Salvu Borg

It is only what FERRARI gets (is paid) that is wrong/bad because its FERRARI.
FERRARI, Mercedes, Red Bull and McLaren have separate agreed deals for constructors championship bonus payments.
FERRARI receives a long standing team payment.
Williams receives a heritage payment.
Red Bull receives an extra payment for being the first team to sign the current concord.
Mercedes receives a special annual payment as doe Red Bull.

p1ngu

My wording is fine and my meanings are clear. Yours, sadly, are not.

Salvu Borg

On the one hand at the risk of sounding repetitive and on the other because of being pushed by confused minds that oozes love from all holes in their body for anything to do with FERRARI. This here now problem/confrontation by LM is nothing new, in fact it is an exact repeat of what others before them always used, it is driven by the desire to maximizes the return of their respective investment, with the exact same sweeteners dropped in, “love for the sports/improving the sports/helping the small teams, that this and the other”. When it comes to payments/handing out… Read more »

jakobusvdl

I think it’s worth remembering that we’re in a post-Bernie era. And while Bernie did an amazing job of controlling the F1 world for a very long time, he did it in a very manipulative and decisive way. Liberty Media have a different approach, one that’s aimed at reducing costs to compete (something Marchionne says he supports). Its possible that not all the long established teams will stay around for the 2021+ Liberty F1 era, but long established and championship winning teams (such as Lotus, Brabham, Bennetton) have left F1 due to changes in and outside the sport over the… Read more »

Salvu Borg

Yes we are in post-Bernie era, but this is the same power struggle fight the scope of which is maximizing the commercial rights investments/maximizing the profits, in short milking F1 as big as possible. reducing costs/budget gaps/ helping the small teams/better distribution of funds, were all sweeteners that are being repeated today. lots of teams came and went and F1 went ahead and kept growing to new heights, but no FARRARI came and went, when and if that happens F1 will be no more.

jakobusvdl

I agree that it is still about maximising the commercial returns from F1, but so far are talking a good game about making a bigger pie, so all the participants get a bigger slice, mind you they’ve also been suggesting the circuits and fans will pay less, so maybe it is all B.S. Ferrari are still by far the most popular team/brand in F1, so if they did go it would be a huge blow to F1, but I don’t think it would kill it. After all F1 survived the loss of Lotus (twice), which I thought was the end… Read more »

Salvu Borg

JAKO, It is the exact same old thing, it all revolves about maximizing returns, nothing more and nothing less, in short nothing different. Less complicated less costly to make engines, helping the would be engine makers, making F1 less costly, helping would be new F1 entrants, budget gaps, better distribution of money, helping the small teams. The whole lot was there before, the whole lot is being repeated. If what these new owners unlike the ones before them are doing this for their love of F1, Why don’t they deep their hands in their pockets and avoid all this confrontation… Read more »

Achim

I think it is important to point out, that the 3 engine manufacturers also have their own works team! And their only chance to consistently beat teams like Force India, Williams and so on is because they can spend more money. All teams have clever people and Force India maybe would be WCC if it were not about absolute number of points but about least amount of money spend per point. But the big teams simply can hire more of those clever people than the non-work teams. Except for Red Bull of course. Which is not an engine manufacturer. And… Read more »

MIE

Ferrari have been paid for their ‘commitment to the series’ since the first Concorde agreement in 1981. By the end of 1981 they had entered 345 F1 grands prix over 32 seasons. For a current team to have started the same number of grands prix (and therefore be eligible for the same payment for their ‘commitment to the series’, they would have had to be racing since the 1999 season. All of the field except Haas were racing in one form or another then. Even if you go back 32 seasons to 1986 six of the ten teams (or their… Read more »

jakobusvdl

There is a good breakdown of the constructors payments in the Autocar article linked; https://www.autosport.com/f1/news/129388/formula-1-team-payments-for-2017-revealed It’s not just Ferrari who get ‘extra’ payments – Ferrari get their Longstanding Team payment – $68m Mercedes, RBR, McLaren and Ferrari get Constructors Championship payments – $30m to $39m each Williams get a Heritage Team payment – $10m. The Basic payment format where every team gets $36m if they’ve been in the series 3 years, plus a payment based on placing in the previous season – 19% of the pool for the winner, down to 4% for 10th. So the distribution based on that… Read more »

MIE

If Force India were to win the constructors championship, they would get less in prize money than Ferrari, even if Ferrari came last.

Force India have been around as a team (as Jordan) since 1991, so are as entitled to long service payments as Ferrari were when they started receiving them.

Salvu Borg

Why didn’t Force India negotiated all that you claiming with their paymasters? and why their paymasters didn’t pay them as much as the hated FERRARI? could it be that their status was calculated by their paymasters as being no more than that of garagisti compared to FERRARI?.

jakobusvdl

Ferrari, Mercedes, Red Bull and probably McLaren would get more than F.I.
I’m not disagreeing that the Long Standing Team payments don’t appear to be justifiable, just highlighting that its not just Ferrari who were able to negotiate extra payments out of Bernie/CVC.
Hopefully L.M will be able to negotiate a more equitable distribution of payments, but when half the teams on the grid are benefiting from extra payments of some sort, that will be more difficult to get agreement on than if it were just one team.

Salvu Borg

All teams on the grid negated and signed their individual concord agreements with the commercial rights holders. FERRARI, Mercedes, red bull, McLaren and Williams managed to negotiate and obtain special payments, no one of these speaks out about the special payments FERRARI managed to negotiate, only some of their fanboys do mostly instigated by some of the British F1 sites. as you JAKO just said, lets wait and see who of the five above teams will sign-up for what LM are going to push out.

Sakae

Since when in Western society everyone must earn the same? I was under impression that each person or entity negotiates their own deal, and it is done as a private agreement, and it should stay as such, otherwise suddenly we get into this useless and weird public discussion what Ferrari deserves. How about discussion what CVC or Liberty deserve..? Or, what guy working next to me what he deserves? Ferrari has what they negotiated, and if it is a sore point for some people, then it’s just too bad. We cannot solve all which pains us. (Guardian – )Hamilton is… Read more »

Salvu Borg

The flip side to what is being said about FERRARI leaving the sports and how FERRERI needs F1 more then F1 needs FERRARI and how much important FERRARI is to the sports.
LM paid upper of $8-bn to buy the commercial rights to the sports, they are public company. anyone who thinks that FERRARI pulling out would have minimal effect of F1’S revenue is naïve. who on Gods green earth wants to be an investor in F1 without FERRARI?.