Brown: Engines and driver salaries should be included in budget

20/05/2020
NEWS STORY

Though not widely publicised, when the budget cap is introduced next year a number of items are not included, these being driver salaries, the salaries of a number of leading team members and marketing.

As any aficionado of Fantasy F1 games will tell you, when setting up your ideal team one has to weigh-up whether to splash-out on the best driver, chassis or engine, spend equally on all three or favour engine and chassis and go with a rookie in the hope that he's more of a Lando than a Haryanto.

To many it seems bizarre that while teams are seemingly being restricted to $145m - with some arguing the cap should be set even lower - in terms of driver salaries and those of top designers and engineers spending will continue more or less unfettered.

McLaren boss, Zak Brown believes that F1 should think again, and include not only driver salaries but the cost of engine development, a move that would not please the likes of Ferrari or indeed his own new partner from next season, Mercedes.

"I think anything that is performance-related, engine, driver etc, should sit inside the cap," he tells Forbes. "I am in favour of including everything in an all-in-one figure.

What should sit outside of it are things like marketing and motorhomes," adds the (ahem) marketing guru, "because they don't make you go faster and are part of your brand's DNA.

"So if you want to spend twice as much as the next guy on a motorhome, go for it. It is not going to make you go any faster but if that is what you need to do to support your brand or your sponsors, have at it.

"I think that part of the glamor side of Formula One is what the teams' brands look like so that should sit outside the cap."

Brown believes that keeping anything that doesn't affect performance out of the cap "accentuates Formula One's DNA which is making it an engineering and technical contest by saying to teams that they have a fixed amount of money so he who is smartest, wins. Whereas now it is he who spends the most wins.

"In my opinion, the ideal scenario is a lower budget cap with more technical freedom," he continues, "because then you get into really seeing who makes the best use of their money.

"That becomes an engineering challenge: do I want to pay a driver $20 million and spend $10 million on my car or do I want to spend $20 million on my car and $10 million on my driver? That's part of the DNA of Formula One... How do I want to spend my money? What do I think is going to get me my best on track product?"

In terms of the recent suggestion that the smaller teams be allowed to buy their bigger rivals year-old cars, he says that this "may help to solve the fiscal side but it does nothing for the sporting side".

"How are you going to beat this year's car with one from last year?" he continues. "I think the teams that are suggesting this think that the teams they refer to as backmarkers should accept being backmarkers. It helps one problem but actually reinforces another... the haves and have nots."

"The strong majority of the teams are in total support, of a lower budget cap, $125 million or $130 million," he adds. "I think some would definitely be supportive of 100."

One of Ferrari's objections to the cap is the resultant loss of jobs, with claims that across the paddock there could be upwards of 1,600 redundancies.

With 714 staff and costs of 237m ($293m) in 2018, McLaren, like its rivals, will need to shed staff, however Brown is confident that the company's diversification into other series will help.

"The nice thing is we are now entering IndyCar, we are looking at sports cars, we have got a big automotive business," he says. "So I do sympathize immensely with everyone who has got to make tough decisions because in any business, people are your strongest asset. So that is all under review right now and fortunately we will end up with probably a variety of different ways we can handle the situation.

"Because of everything we are going through now, we don't know yet what percentage of staff can be saved by being moved to other divisions of the company. I think every company in the world is reviewing its business, its model and what is it going to do differently.

"You have two things going on. It would be one thing if it was just the budget cap in a stable environment but we are dealing with the moving target of what is going on with the world as well as the budget cap. So it is all intertwined."

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Published: 20/05/2020
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