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FIA says £40m budget cap going ahead

By Jonathan Noble
Tuesday, June 16th 2009, 09:13 GMT

Max MosleyThe FIA says that its plans for a £40 million budget cap will now go ahead unchanged, after the latest talks between the governing body and the Formula One Teams' Association (FOTA) to try and find a compromise ended without a deal.

Leading financial representatives from both the FIA and FOTA met in London on Monday to try and reach a settlement on next year's rules that would be acceptable to both parties.

There had been some hope that new rules could be put in place after preliminary agreement was reached between FIA president Max Mosley and several representatives of FOTA in a meeting last week.

However, the FIA has been left disappointed that this week's meeting achieved nothing, after FOTA's representatives said they could not discuss the rules, and the teams' proposals were rejected as being ineffective.

A statement issued by the FIA on Tuesday said: "As agreed at the meeting of 11 June, FIA financial experts met yesterday with financial experts from FOTA.

"Unfortunately, the FOTA representatives announced that they had no mandate to discuss the FIA's 2010 financial regulations. Indeed, they were not prepared to discuss regulation at all.

"As a result, the meeting could not achieve its purpose of comparing the FIA's rules with the FOTA proposals with a view to finding a common position.

"In default of a proper dialogue, the FOTA financial proposals were discussed but it became clear that these would not be capable of limiting the expenditure of a team which had the resources to outspend its competitors. Another financial arms race would then be inevitable.

"The FIA Financial Regulations therefore remain as published."

The FIA has become increasingly frustrated with the failure to find a solution to the row, and on Monday it accused factions with FOTA of deliberately trying to scupper a deal.

F1's current teams have been given until Friday to drop the conditions attached to their entries, or risk being left off the grid for 2010.

With part of their conditions being that the 2010 regulations are scrapped, the FIA's latest stance makes it increasingly unlikely that the matter can be resolved before the deadline.

Faced with the prospect of only 18 cars in Melbourne 2009 and the possibility of worse to come in 2010, the FIA had to act. There were two obvious steps. First, approach Mr. di Montezemolo to see if the car manufacturers would guarantee the presence of their teams in 2010 so that we would not have a repeat of the Honda situation. Secondly, begin talks with FOTA about reducing costs to the point where the manufacturers would be less likely to stop, the independent teams would be viable and perhaps some new teams would enter to fill the empty spaces.

Mr. di Montezemolo promised to secure the necessary guarantees from the main car manufacturing companies (not to be confused with guarantees from the teams). He continued to promise this all through the winter, most recently at a meeting he had with the FIA’s President on 23 February 2009. Not one such letter has been forthcoming – not even from Mr. di Montezemolo's own company FIAT.

At the same time FOTA and Mr. di Montezemolo rebuffed all attempts to hold meetings to discuss cost reduction. There was no need, the FIA were told. FOTA's own measures were adequate and they would make up for the shortage of cars by each running a third car. By March it was clear that FOTA had no intention of facilitating the entry of new teams, indeed were opposed.

Ferrari voted against the financial regulation at that meeting but not against special technical freedoms for the new teams (i.e. Ferrari did not vote against the "two-tier" system).

Even after this vote, FOTA were not prepared to talk. Neither was Mr. di Montezemolo, even privately. In the absence of any negotiation or any sign that the promised guarantees of participation from the car companies would be forthcoming, it was essential to publish detailed regulations and invite entries from new teams. Otherwise there was a real risk that there would not be enough cars for Melbourne in 2010.

The detailed regulations were discussed and voted on at the WMSC meeting of 29 April. The new Ferrari representative on the WMSC was Mr. di Montezemolo, replacing Jean Todt whose Ferrari contract finished on 31 March. Mr. di Montezemolo chose not to attend but gave a proxy to Mr. Macaluso, the Italian president of Karting, who also did not attend but joined the meeting by video link. His was one of two votes against the new rules but no reasons or alternative were offered.

John Howett as vice-chairman of FOTA led their delegation in the absence of Mr. di Montezemolo. As soon as the FIA raised the question of the financial regulation, Mr. Howett tried to lead a walk-out of the teams. This did not succeed but during the meeting it became known that Ferrari had begun emergency proceedings in the French courts seeking to prevent the introduction of the 2010 rules. It was clear that FOTA had no intention of negotiating anything but simply expected the FIA to agree to all its demands.

in particular the "two-tier" system. It was explained that it had already been agreed to substitute technical help from established teams for the two-tier system at the Heathrow meeting, so this was no longer an issue. This was pointed out to Mr di Montezemolo at least five times during the meeting but he and FOTA are still talking about it today.

On 29 May, the eight remaining FOTA teams submitted conditional entries. Among the conditions were a requirement that the FIA forthwith sign FOTA's new Concorde Agreement (which diluted the Sporting Code, made an outside body, the CAS, the ultimate appeal court, allowed any team to veto rule changes and removed the FIA's right to insist on changes if the cars became dangerously fast). FOTA also crossed out references to the International Sporting Code on their entry forms and wanted the 2010 Rules rescinded notwithstanding that a number of new teams had already submitted entries.

A further meeting was held on 11 June at which FOTA were represented by Ross Brawn (Brawn), Stefano Domenicali (Ferrari), Christian Horner (Red Bull) and John Howett (Toyota). After nearly five hours of talks, it was agreed that the FOTA and FIA cost-reduction objectives were very close if not identical and that the financial experts from both side should meet without delay to seek a common position on detail. Also, the FIA's proposal to extend the 1998 Concorde Agreement in order to avoid interminable negotiations was well received. Agreement was also reached on some minor modifications and clarifications to the 2010 rules.

No sooner had all this been agreed than FOTA put out a statement saying no progress had been made in the meeting. This blatant falsehood demonstrates once again that elements in FOTA simply do not want agreement.

FOTA says, "The new rules dumb down the sport". Not so, the 2009 regulations introduced greater technical freedom in several areas. The 2010 Regulations will allow even greater freedom. Compare this with the FOTA proposals: almost no testing, no KERS, homologated gearbox, homologated bodywork, limitations on factory activities, enforced shutdowns and so on.

New series is a win-win situation for everyone.

1. Teams-More revenues from commercial rights and what's more important, stable rules that aren't changed after every wet dream Mosley has.
2. Track owners- Wont have to pay ridiculous amount of hosting fee to Ecclestone and that would decrease the ticket prize=>even more tickets sold.
3. Fans- Without bullshit from Mosley and Bernie we are guaranteed to have less politics but more raceing.

I do think that the split cant be comparable to IRL/Champcar. 90% of serious teams would leave to create proper series.While, most probably only Williams will stick to F1.And who cares about Williams anyway?

New series is a win-win situation for everyone.

1. Teams-More revenues from commercial rights and what's more important, stable rules that aren't changed after every wet dream Mosley has.
2. Track owners- Wont have to pay ridiculous amount of hosting fee to Ecclestone and that would decrease the ticket prize=>even more tickets sold.
3. Fans- Without bullshit from Mosley and Bernie we are guaranteed to have less politics but more raceing.

I do think that the split cant be comparable to IRL/Champcar. 90% of serious teams would leave to create proper series.While, most probably only Williams will stick to F1.And who cares about Williams anyway?

New series is a win-win situation for everyone.

1. Teams-More revenues from commercial rights and what's more important, stable rules that aren't changed after every wet dream Mosley has.
2. Track owners- Wont have to pay ridiculous amount of hosting fee to Ecclestone and that would decrease the ticket prize=>even more tickets sold.
3. Fans- Without bullshit from Mosley and Bernie we are guaranteed to have less politics but more raceing.

I do think that the split cant be comparable to IRL/Champcar. 90% of serious teams would leave to create proper series.While, most probably only Williams will stick to F1.And who cares about Williams anyway?

If FOTA's real ambition is to get rid of Max, then they should have done it the traditional way and between them fielded a candidate to run against him in October. Mosely has never had to face real opposition, and would likely get toppled.

New series is a win-win situation for everyone.

1. Teams-More revenues from commercial rights and what's more important, stable rules that aren't changed after every wet dream Mosley has.
2. Track owners- Wont have to pay ridiculous amount of hosting fee to Ecclestone and that would decrease the ticket prize=>even more tickets sold.
3. Fans- Without bullshit from Mosley and Bernie we are guaranteed to have less politics but more raceing.

I do think that the split cant be comparable to IRL/Champcar. 90% of serious teams would leave to create proper series.While, most probably only Williams will stick to F1.And who cares about Williams anyway?

Wouldn't surprise me if things went tits up on Friday. The problem is the ego's on both sides, both sides are stubborn dicks and they'll destroy the sport before ever agreeing.

Finally, F1 will die.

Finally, F1 will die.

Are you kidding yourself? This will be an absolute re-run of the IRL/Champ Car collapse. F1 will kill itself if this goes through.