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Formula 1 budget cap: How would it affect the sport?

By Rahul Bharadwaj

MELBOURNE, AUSTRALIA - MARCH 23: Ferrari Team Principal Maurizio Arrivabene, Mercedes GP Executive Director Toto Wolff and Red Bull Racing Team Principal Christian Horner in the Team Principals Press Conference during practice for the Australian Formula One Grand Prix at Albert Park on March 23, 2018 in Melbourne, Australia. (Photo by Mark Thompson/Getty Images)
MELBOURNE, AUSTRALIA - MARCH 23: Ferrari Team Principal Maurizio Arrivabene, Mercedes GP Executive Director Toto Wolff and Red Bull Racing Team Principal Christian Horner in the Team Principals Press Conference during practice for the Australian Formula One Grand Prix at Albert Park on March 23, 2018 in Melbourne, Australia. (Photo by Mark Thompson/Getty Images) /
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ABU DHABI, UNITED ARAB EMIRATES – NOVEMBER 25: Valtteri Bottas driving the (77) Mercedes AMG Petronas F1 Team Mercedes WO9 leads Sebastian Vettel of Germany driving the (5) Scuderia Ferrari SF71H (Photo by Charles Coates/Getty Images)
ABU DHABI, UNITED ARAB EMIRATES – NOVEMBER 25: Valtteri Bottas driving the (77) Mercedes AMG Petronas F1 Team Mercedes WO9 leads Sebastian Vettel of Germany driving the (5) Scuderia Ferrari SF71H (Photo by Charles Coates/Getty Images) /

2. Innovation

With a budget, championship teams will be compelled to win even with a lower budget. This fuels innovation along with the current midfield teams that have repeatedly looked for ways to compete even with considerably small budgets.

While top teams cannot allow poor performances, the moderate teams will go all-out on their development to try and win few championships before the top teams can spring back to their winning ways. So expect a lot of new additions or variations to come.

On the contrary, a lot of regulations lead to a dead-end in innovation. Most of the outer design and power unit specifications are now regulated. This means that there can’t be many changes that teams can do to these parts.

Forcing a budget cap translates to teams not being able to spend big on expensive, out-of-the-world technology, as they’re restrained on the financial side of things. In short, teams cannot make great advancements on parts of the car where the specifications and design are not administered by the FIA.

3. Unfair advantage for manufacturers

Let’s say that the budget cap is successfully implemented. How would the FIA ensure that it is being followed? This is a recurring question that has stood in the way of Formula 1 introducing a budget cap for nearly a decade now.

Manufacturer teams Ferrari, Mercedes and Renault will be a problem when it comes to administering the costs. How will the FIA make sure that these teams aren’t using one of their facilities around the globe for research?

Ferrari are mostly limited to Italy, but what about Mercedes and Renault? These are global brands with multiple manufacturing and research and development centers around the world. Will the FIA be effectively able to make certain that there is no external help? What about things like wind tunnel testing?

Bigger teams can use the in-house equipment whereas smaller teams will have to pay a hefty price to get these tests outsourced. Even then, how will Formula 1 value these tests? These are some questions that the FIA and Liberty Media have yet to answer. Introducing a budget cap without ensuring these aspects might just turn out to be the same as not having one at all.

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