The knock-on impact of Red Bull penalty that’s upset Ferrari
Ferrari believes the “basic effect” of the Accepted Breach Agreement Red Bull reached with the FIA over its 2021 Formula 1 cost cap overspend encourages money that could otherwise have been taken from the team’s budget to be spent elsewhere.
Sporting director Laurent Mekies says Ferrari believes the “basic effect” of the Accepted Breach Agreement Red Bull reached with the FIA over its 2021 Formula 1 cost cap overspend encourages money that could otherwise have been taken from the team’s budget to be spent elsewhere.
Red Bull was fined $7million and had 10% of its aerodynamic testing allowance for the next 12 months removed after it agreed an Accepted Breach Agreement with the FIA for overspending.
The cost cap was introduced in 2021 at a baseline figure of $145m, dropping to $140m this year and $135m next year – although the real figures are higher thanks to various extra allowances and inflation adjustments.
But Red Bull was the only one of the 10 teams found to have overspent.
Mekies said Ferrari believes the overspend equates to a performance gain of two tenths and reiterated the team’s discontent at the “very limited’ penalty its rival had been given.
“We at Ferrari do not understand how the 10% reduction of the ATA can correspond to the same amount of lap time,” said Mekies.
“Furthermore, there is another problem in that since there is no budget cap reduction in the penalty, the basic effect is to push the competitor to spend the money elsewhere.
“It has total freedom to use the money it can no longer spend on use of the windtunnel and CFD due to the 10% reduction, on reducing the weight of the car or who knows what else.
“Our concern is that the combination of these two factors means the real effect of the penalty is very limited.”
Mercedes team principal Toto Wolff suggested it was sensible for teams to leave some headroom in spending for 2021 to allow for any variation in interpretation of the regulations.
“Yes, absolutely, you need to build a little bit of leeway,” said Wolff, when asked by Sky Sports F1 if Mercedes played it safe because the regulations were new.
“You can’t take an aggressive approach in the beginning. It’s a process, it’s learning on the job.”
Red Bull’s original submission placed it £3.7m under the cost cap, according to team principal Christian Horner. But according to the FIA Cost Cap Administration analysis, its final overspend figure was £432,652 once its ‘Relevant Costs’ (those covered by the cost cap) were recalculated.
So while Horner did concede that Red Bull was “aggressive” with its attempt to exclude all catering costs, he indicated it did believe it had some leeway.
Alpine team principal Otmar Szafnauer echoed Wolff’s position, indicating that the team had a “buffer” in the early days of the cost cap as it works to maximising the permitted spending once fully comfortable with the regulations.
“The more refined that your processes are, your accounting processes, the closer you can get to the cap and feel comfortable you haven’t missed anything that will put you over,” said Szafnauer.
“However, if your processes aren’t very refined, if you don’t have that fidelity, then what you have to do is give yourself a big enough margin that if you did make a mistake you don’t go over.
“That’s exactly what we do. As we go on in time, and we get more comfortable, we’ll aim to be right on the cap. But today, we’re millions under just to have that buffer so we don’t go over.”
Szafnauer suggested this is an approach shared by several teams, which he hoped will ensure that there isn’t a repeat of the cost cap controversy next year with a team or teams spending too much thanks to the scale of the challenge of the 2022 cars.
“Well, I hope not,” he said when asked if he expected to hear more about this at the same time next year.
“We put in a buffer so that we assure ourselves that we’re under. People make mistakes and you can make mistakes, that it’s not malicious or it’s not intentional, but then to be able to sleep well at night to say, ‘You know what, we’re going to be under’, we give ourselves that buffer.
“And I think maybe some of the other teams do the same.”
Szafnauer backed the punishment given to Red Bull on the basis that “the punishment is a good one”, while Wolff was non-committal, saying “it’s just good to see that there is a penalty, whether we deem it too low or too high”.
But Andreas Seidl, team principal of McLaren, felt that the penalty did not fit the crime.
Zak Brown, McLaren CEO, sent a letter to the FIA calling for any cost cap “cheating” to be heavily penalised with the team taking a strong line on the need for significant punishment.
“In the end, on the positive side it’s good to see that they did a good job in terms of doing the audit,” said Seidl.
“Nine teams got it right, and it was confirmed that one team was clearly in breach, so that’s a positive outcome.
But on the negative side, it’s also clear that from my point of view that the penalty clearly doesn’t fit the breach. I just hope that moving forward we have stricter penalties in place.”
Wolff said he hoped the penalty will act as “a deterrent”, but in response to suggestions teams could be tempted to overspend deliberately given the size of the Red Bull penalty he said that the negative impact on a team’s reputation plays a part in the desire to avoid an overspend.
“What you see beyond the sporting penalty and the financial fine is also reputational damage,” said Wolff.
“In a world of transparency and good governance, that’s just not on anymore.
“Compliance-wise, whatever team you are, you’re responsible for representing your brand, your employees, your partners. And that’s why for us it wouldn’t be a business case.”
