FIA: £30 million budget cap for 2010

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FIA Door
I have one simple, harmless question:

Since when and with what authority did the FIA become the CEO of all the teams and begin deciding how the operation will work, what salaries will be paid, what dividends/bonuses will be distributed and what the Balance sheet and P&L’s will look like? Who’s business is it what Martin Whitmarsh makes? Who’s business is it what Vijay Mallya takes as a dividend and when he takes it? The teams have all the risk both personally and commercially, Max and the FIA do not. The last I checked, the tax payers were not bailing out the teams nor is the FIA so I think it nonsensical to suggest the FIA govern a teams finances.

You can read the rest of this story and Autosport’s terrfic dialog on the story here.

“The technical freedoms accorded to the low-budget teams will be adjusted from time to time to keep their median performance on a par with the median performance of the unlimited-expenditure teams. The regulations for the unlimited-expenditure teams will remain stable and fixed.”

FIA president Max Mosley confirmed that the £30 million budget cap would include drivers’ salaries.

When asked what was included, Mosley said: “Everything except the motor home (if the team has one) and any fine(s) imposed by the FIA. All expenditure will be included, even the salaries of the drivers and team principal.

“If the team is profitable, it can pay a dividend to its shareholders, who may well include a chief engineer, team principal or even a driver. But we would make sure the team was genuinely making enough profit to cover the dividend.”

“A different (but standard) under body, movable wings, no engine rev limit, no restriction on the number or type of updates, no homologation requirements, no limits on materials, testing, simulators, wind tunnels and so forth – most of the cost saving measures introduced over the last few years will not apply to these teams,” he explained.

“However measures to save money during the race weekend, such as the ban on refuelling and the Saturday parc ferme, will apply to both categories of team. We are also thinking about a much bigger capacity KERS for the cost-capped teams. But all this must be covered by the £30 million – no exceptions and no free or subsidised outside help.

“Anything supplied by another team or an outside supplier will be included at its full commercial cost except for items supplied to all teams at subsidised rates under the single supplier arrangements negotiated by the FIA (e.g. for tyres), which allow all teams to benefit equally from reduced costs.”

He added: “The engine will comply with current rules, except that there will be no rev limit and no development freeze. However, the entire engine expenditure will come out of the cap. If the engine is supplied by an outside commercial entity or another team, we will have to be satisfied that there is no hidden subsidy.

“If a team has its own engine, we will check its full cost just as we will the rest of the car. The current rule limiting manufacturers to supplying engines to one additional team each will remain in place.”

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