We don’t need no stinking Concorde Agreement…or at least that’s what Formula One boss Bernie Ecclestone told Mr. Sylt. It’s an interesting twist as the Concorde Agreement is the legal document that binds the teams to a commercial and regulatory format for a duration of time. It’s been around since Slim Borgudd puttered around in his Team ATS F1 car and Nelson Piquet won the championship.
The Concorde Agreement is a pivotal negotiation point for teams, commercial rights holder (CVC Capital) and the FIA (governing body) and while the deal isn’t signed, Ecclestone says he already has the financial aspect worked out with the teams. The sticking point, according to Ecclestone, is the FIA portion of the agreement:
“The Concorde Agreement is really made up of two sections. We have already dealt with the financial section with the teams. It is all done so it is a case of the regulations which change all the time. It’s a case really of how you change the regulations.”
It’s an interesting point and while I am not privy to the finer details of the negotiation, I do recall that the FIA was looking for an expanded financial position but that isn’t what Mr. Ecclestone mentions…it’s the regulations or the manner in which they change that seems to be the concern.
Regulation changes have historically meant an increase in the costs to the teams. The planned 2014 engine changes, while perhaps more relevant to the road car industry, will require an all new engine design, manufacturing and expense. Small changes require big dollars in F1 and perhaps it is the frequency of changes or the very nature of the changes themselves that have the teams and the FIA concerned. Ecclestone said:
“What affects the teams more than anything is the technical regulations. It is the technical regulations which could put them out of business,” Ecclestone said.
Ultimately the teams have to have a comfort level with the regulatory changes to the sport, how frequent they happen and just what kinds of regulation changes are being sought. The future of the sport is what the teams would like to have more security over and Lotus F1’s Eric Boullier says that is key:
“We have agreement with Bernie but we are still lacking some protection over the future of the sport. If you are building a business over a period of time you need some stability or some guarantee. We have part of it thanks to the Bernie agreement. As a private organisation we obviously would like to see more security over the future. The regulations are obviously our main costs so it is important to have visibility on that and be able to control our costs.”
Either way, the issue is the teams have the new “Bernie Agreement” and to be honest, that’s as good of a name as Concorde so let the racing being in 2013.