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BMW drops the ball on rescue of Sauber
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BMW drops the ball on rescue of Sauber
Posted By: James Allen  |  06 Aug 2009   |  3:26 pm GMT  |  42 comments

Peter Sauber has reacted angrily to the behaviour of BMW in his attempt to rescue the team, following the manufacturer’s decision to withdraw from Formula 1.
BMW pits
The team had a deadline of yesterday (Wednesday) to sign the new Concorde Agreement or face the possible loss of TV money and prize money from this year, amounting to tens of millions of dollars.

“I negotiated for three days but couldn’t find an agreement with BMW,” said Sauber in La Gazzetta dello Sport. “I’m dismayed, but I’m not giving up, even though now it is more complicated as it will cost many millions to stay in F1 as we would have to register as a new team.”

This is shocking news for Sauber who thought he was safe to entrust his workforce and their livelihoods to BMW when he sold the team to them in 2006.

When Honda pulled out of F1 last year, no buyer could be found and Ross Brawn felt morally obliged to save the team and together with his partners took significant risks to save the jobs of most of the workforce and keep the team on track.

Honda was persuaded to give the team to the management for a nominal fee and set them up with a budget for the first season. Initially Bernie Ecclestone was unwilling to release the prize money and TV money due to Honda for 2008, some €35 million, but the team received it this week, on signature of the new Concorde Agreement. This provides a timely boost to their coffers as they attempt to keep up with the Red Bull cars.

Sauber feels even more morally obliged to save the team, as he set it up in the first place. But BMW have clearly not got the integrity Honda had. Admittedly the time frame was very tight, given that they only decided to quite a week ago, but they have not done the right thing by the sport and by the team’s employees and set the team up for the future.

FOTA put out a statement last night saying that they would do whatever they could to help Sauber get on the grid for next year.

Meanwhile Robert Kubica has expressed his sympathy and concern for the workforce,
“It will not be difficult for me or Nick Heidfeld to get a drive for next year, but it will be far harder to find jobs for the hundreds of people who work at the team.”

“I am incredibly disappointed and disconsolate,” Sauber told Autosport. “For me this is the bitterest day in my 40-year career in motor sport. It is also a devastating setback for the team.

“Other solutions must now be sought. The responsibility for that lies in the hands of BMW. Needless to say, I am willing to help, as before.”

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42 Comments
  1. Andy Gibson says:

    I am completed disgusted by BMW’s actions. They made a moral (if maybe not written) commitment to Peter Sauber when they took over the team. He did the right thing by his people, and BMW have thrown that all away.

    I truely hope that a solution can still be found that allows the team to continue, with Bernie and the other teams allowing them to sign the Concorde Agreement late and still recieve the revenues their hard working staff and Peter Sauber deserve.

    Good riddance to BMW, I hope we never see them in F1 again!

  2. jw1980 says:

    BMW’s behaviour is so disappointing on many grounds. However, should we be surprised? Earlier this year did the company not give minimal notice to its temporary workers at the Mini factory in Oxfordshire? Additionally, is it fair to say that BMW only purchased Rover so that they could get their hands on the Mini?
    As a company they seem very unconcerned about their people. Many people will be very careful entering agreements with them in the future.
    They have done few favours to F1. We could have a grid of 26 cars next year. If Sauber cannot make it surely it’s getting too late for another team to enter?
    At least we know one thing for sure. BMW simply were not good enough. With a performance like theirs this year they will not be missed. Lets hope that there is a positive resolution for the staff.
    I also hear that senior executives at Toyota do not think that Kubica is fast enough? Where is he going to end up next year?

    1. Alex says:

      It’s not too late for the new teams. I know for sure 100% that two teams on the reserve list are still developing their cars flat out. It’s an expensive waiting game to play but until they hear from the FIA they have no choice

      1. jw1980 says:

        Alex,

        which two teams are still interested? I hear that Eskudi in Northern Spain are still going for it.
        Reading another article on the internet a takeover of Sauber may be difficult because of their location – not very appealing to potential buyers due to cost and isolation I suspect.

    2. Martin Smith says:

      So the execs at Toyota don’t think Kubica’s fast enough? Well it’s a good job they’re so well versed in getting their hands on drivers who _are_ fast enough.

      Oh, hang on a sec…

      1. jw1980 says:

        I agree that Kubica would be a good driver for Toyota to have.
        He is a very good driver in my opinion although still has more to prove if he wants to be considered as top rank of amongst current F1 drivers. The potential is there, though.
        You never know he may still drive for Ferrari if Schumacher does not come back due to neck problems. However, looking at BMW’s behaviour it’s unlikely they would release him as a goodwill gesture.

  3. Matt says:

    Hopefully they’ll handle it better than they did Rover.

  4. Snail says:

    But BMW have clearly not got the integrity Honda had.

    You said it James. I agree. Almost as if they want it to go away.

    I thought Ferrari had blemished their luxury brand image with their Williams tantrum the other day, but this really dents BMW’s image – looks like they don’t care about their former staff at all. Looks like they are total corporate breadheads, money first and last and always and nothing else matters. Good riddance to them if that is their attitude.

    Maybe I’m pre-judging and they’ll turn around and help Peter Sauber rescue the team and stump up the cash that will now be lost because FOM won’t be legally obliged to pay the TV/prize money.

    I wonder which view is correct?

    1. BMW have clearly not got the integrity Honda had

      Hmmm. That’s a bit like saying someone doesn’t have the manners of a pig.

      I just don’t consider Hondas when buying a new car after the way the pulled out of Williams in the 1980s. Who remembers the Ford and Peugeot engines that McLaren limped round with in after Honda Pulled the plug there ? Setting up their own team and canning it, buying Out BAR, and dumping it … as someone described Harold Wilson on Europe, so Honda in F1 : it’s a policy of Coitus interuptus.

      BMW, were in the 80s, then out, then back with Williams, then dumping them, buying a team and them dumping it, without the grace that the Honda had learnt in their past exits.

      Of Course don’t forget Ford did the same thing “We’re buying Stewart and re-branding it Jaguar” … spend, spend, spend and …dump.

      People wonder about Renault, who have dipped in and out – I don’t think they’ve gone as Berserk with the chequebook and won a lot more races than the 3 above put together.

      And I was just reading that 3 out of 4 mergers/takeovers fail http://sinekpartners.typepad.com/refocus/2009/08/50-t-of-all-corporate-mergers-completely-fail-an-additional-25-never-achieve-the-roi-that-was-promised-that-means-75-of.html

  5. Kirk says:

    Disgraceful attitude from BMW – if they ever want to get back into F1 in the future the FIA/FOM should make them pay for this with over the top guarantees.

    They are probably trying to get more money for the sale of the team (assets, equipment, infrastructure etc) instead of thinking how to save the jobs of all the people working for them. And to think they were in the FOTA group trying to do what was “best for F1″ not so long ago…

    Maybe Max Mosley wasn’t so crazy after all when he slammed these corporate suit car makers.

    1. Werewolf says:

      I suspect you are absolutely right. You can almost see the pound/euro/dollar signs hanging over the wind tunnel.

      1. Graham O'Reilly says:

        As I remember, Sauber installed the wind tunnel to make his company more attractive before he sold it to BMW. It’s certainly one reason BMW went for them. You’d think they might remember that.

  6. john g says:

    it is ridiculous they could not come to some sort of agreement to ensure not only the security of the sauber team, but also the future of the massive resources in Hinwil, and the prize money that is owed to them – surely had Sauber ‘bought’ the team back from BMW, then he would be entitled to this money? so what happens to it now (and what happened to the money that was owed to Honda)?

    1. Andy Gibson says:

      The money that was owed to Honda was paid to Brawn – as James explains in his story.

      I believe the BMW money would be split between the other 2009 competitors, although I hope that Peter Sauber finds a solution and that Bernie/the teams agree to let a renewed Sauber team still have it.

  7. chaostheory says:

    I see a big big difference of culture between BMw – German big manufaturer and Honda – Japanese one. The Japanese still can be honorable – even when dealing with millions of money, something we in Europe and US lost long time ago :\

  8. Peter says:

    It`s disappointing, I thought BMW had a sporty image…However we do not know the details and car manufacturers desperately need the cash for new technology developments nowadays. I do not think just because they have been on their backfoot we can say the were unsuccessful. They had been developing the fastest until this year when the KERS came into game. They are a very very strong team.

  9. Fightstar says:

    James – One thing that has never really been made clear is how Ross Brawn, an employee of Honda, has managed to become the outright owner. I understand that the team was sold for £1, with the stipulation that the buyer had to prove they could sustain the future of the team.

    How did Ross manage to get the money together? Who are his backers? Is it public knowledge who owns what percentage of the team? What is Nick Fry actually upto?

    1. Nicollers says:

      I’m sure Ross Brawn could muster up £1 Fightstar!

      ;oD

  10. Sam says:

    I agree with most of the posters here and Kubica.
    If they leave the sport, they should at least walk out with dignity.

    What about the people who worked their back-side off for long hours?

    I used to think they make good cars but screw them I won’t support their business forever.

  11. Nicholas says:

    Unless we get a clearer picture of what was discussed, it seems as if BMW are more interested in recouping the cost of their investment. I wonder what part Mario plays in all of this…

  12. Brian Armitage says:

    But BMW have clearly not got the integrity Honda had.

    …although let us not forget Honda’s disgraceful treatment of Frank Williams following his car accident, notifying that they were withdrawing engine supply to the team by fax.

  13. Chocobo168 says:

    Typical German, logically, if they can sell the sum of the parts for more than the sum as a whole, would do so. At the end of the day its business. Doesn’t this imply and reinforces the fact that if there was a budget cap and they could turn a profit from running the team, they would probably have stayed ?

  14. Werewolf says:

    This is a sad moment for F1 that shows, perhaps, two things: a not altogether unexpected lack of integrity and sporting interest on the part of a financially- motivated BMW and, more worryingly, the potential start of the true legacy of this year’s political wranglings. The former is simply a reflection of BMW’s attitude and I have to say their corporate, target-driven approach to F1 will not be missed. F1 has no control over this factor.

    The second aspect, however, is different because F1′s governance is surely the cause. BMW as a corporation, with or without integrity, is not incompetent and has high performance expectations of itself (failed miserably this year in F1) and its partners, as witnessed by its relationship with Williams.
    Failure, as with Rover, is met with terminated partnerships and much washing of Bavarian hands. Even without the FIA-Fota war, the medals-for-wins debacle, diffuser controversy, testing ban, the personal life of Max Mosley and Bernie Ecclestone’s ill-judged Hitler comments, etc, cannot have impressed BMW’s board.

    A third observation has to be Brawn. After all the Honda-must-be-kicking-itself expressions, the collective BMW ego is probably quaking in its hand-sewn designer boots at the possibility of Peter Sauber (or whomever)doing something similar.

    Anyway, best wishes to Sauber and the team in securing a future.

  15. Alex says:

    James,

    What is the next step now? Where does this all go?

    Am I correct in assuming the ball is in the FIA’s court whether or not to admit a new team or wait for the [unlikely] rescue of what was BMW?

    Granted FOTA said they support delaying for BMW but it’s not their right to wait around anyway, even if they are ok with it.

    1. James Allen says:

      Well it seems that they have FOTA’s support which means engines and gearboxes and so on at low cost. As for what happens to their prize money, likely to be around the €30-40 million mark, I’m not sure but I shall look into it. I hope they can sort something out, but there were no sensible buyers for Honda last winter. That said there are some investors sniffing round F1 again, now that the Concorde has been signed and with the resource restriction agreement in place, F1 teams start to look viable again. But it’s still an awful lot of money to lay out to go racing.

  16. Fulveo Ballabeo says:

    James, can you help clarify “Brawn and his partners took significant risks”? What risks, exactly? As you say, Honda gave the team to management for a nominal fee, and set them up with a budget for the first season. That seems about as riskless a proposition as there is in the world of business. Any business-person worth their salt would dream of being given (for $1?) a viable going-concern AND a first-year operating budget. Even better, that going-concern is also a salable asset. Yes, management will have to drum-up a budget for years 2+. But in the world of business, what management team doesn’t? Thanks for your help.

    1. James Allen says:

      Yes, but they had to get the engines in place and then fight to get the Honda prize money, they had no idea whether they would be able to get a budget together for 2010 and on it goes. A big headache, but at the moment it’s looking good. As for next year, time will tell.

  17. Chris says:

    I like BMW cars a lot, and this has just put me off BMW quite a bit.

  18. rasco says:

    It’s ridiculous that BMW quit anyway, they would have 1 year of an expensive team then when the £40 mil cap comes in they would have a profitable team and cheap advertising. The reasons probably that there brand is damaged when they loose to Mercedies all the time.

    The whole thing is a discrace, not only are they seen as quitters, idiots for the kers fiasco, the way they have treated the team shows how low there morals are. I’m never going to buy a BMW ever!

  19. Obster says:

    They are making Honda look like the nice guys!

    I always liked Sauber-sort of the Force India of their day.

  20. James says:

    As much as we have all enjoyed the manufacturers involvement in F1, BMW’s pull out is precisely the reason why they aren’t good for the sport. A racing team is in the business of racing, they’ll do everything to keep in the game. A manufacturer is lead by a bunch of board members who may or may not feel connected to the F1 program. Any bump in the road such as this economic down turn has lead to two manufacturers pulling out. Their image to the buying public can have huge impacts on their investment decisions.

    I am sure many people can’t put the pieces together on why anyone should stay in F1, especially with today’s exorbitant costs. Thankfully we’ll see a few more independent race teams join the grid next year, now let’s hope there will be a buyer for BMW/Sauber.

  21. Williams4ever says:

    Cultural difference. This Exit from F1 will be a good test of Cultural sensitivities, Japanese Marquee could have played hardball with Nick-Brawn and ensured Nick-Brawn never made it to the grid( Remember How Nick Fry thwarted off all the backers Aguri Suzuki used to present to Honda Board to keep Super Aguri afloat??), But they ended up with Win-Lose bargain, where Nick Brawn got good Alimony and Honda ended up supporting the team without getting any credit for the successes of the team in the first half of the season…

    Quite a reflection…

    1. michael c says:

      Can I have a translation of this comment please?

      whatever BMW’s reasons for dealing with the matter the way they have been so far – they are damaging their brand quite badly – and certainly – it seems – more than the cost of ‘doing a Honda’ (and Honda have not had nearly enough credit for this)- for next year for Sauber – given that the team has sponsorship I would have thought that a downscaled involvement would have cost peanuts as far as BMW are concerned – and far less than they will spend on their new found enviromentally friendly add ons

  22. Malcolm46 says:

    This annoys me on many levels, firstly I’m not a BMW fan, but who is advising them on PR? This is such a mess and reflects so badly on BMW especailly when you compare them to Honda, effectively BMW sticking two fingers up at their employees.

    Secondly to avoid the above, why not just sell on the team for a quid, again to ensure that the team survives, and too not look at making a profit.

    Thirdly, now it looks like no buyer, a spot has possibly been lost off the 2010 grid, again selfish of BMW, these to grid spaces could be filled by a team who are actaully interested in racing.

    Looking back to Honda, massive fair do’s to them for helping Brawn this season, I think a lot of people upset at the time the way Honda pulled the plug but on reflection they actually did a fair amount. I maybe wrong, please maybe someone could correct me if I am, but does this have the same sort of smell of what BMW did with Rover a few years ago?

    Lets hope Peter Sauber can help quickly, and thank him for the efforts he is taking to save the team.

  23. FletcherB says:

    Surely BMW have shot themselves in the foot?

    By not signing the agreement, they’ve devalued the team they are presumably trying to sell?

    I can see why they may not necessarily be amenable to a Sauber buy-out if they think they can get more cash from elsewhere…. but surely they can get more cash if one of the “assets” is the right to receive 30-40 million in the near future?

    1. Werewolf says:

      I think that by signing the agreement BMW would have been committing itself to F1 until 2012, meaning it would be in breach of contract if no buyer was found and it did not compete.

  24. Leslie says:

    There must have been an elegant solution about somewhere.
    BMW’s performance in F1 won’t have helped it to sell many cars; it’s exit must surely have a negative effect on sales. The family Mini is up renewal next month………..

  25. Blanchimont says:

    “Since the announcement on 29 July of our strategic realignment, we have done everything in our power to reach a rapid agreement on the sale of the team based at Hinwil…”

    Mario Thiessen’s statement. This “strategic realignment” management guff for “quitting F1″ just about sums up BMW’s whole approach to racing. Best of luck to Sauber, hope a solution is found.

  26. melonfarmer says:

    It is probably the “rescue” of Rover that is causing BMW to be cautious – the so called White Knight, Phoenix 4 are currently indirectly part of a Serious Fraud Office investigation. BMW have been burnt by selling a division to a punter for a nominal fee before.

    The FIA received 13 applications for the 3 grid slots in June; Midland bought Jordan weeks before the start of the season so there’s still plenty of time.

    This whole Daily Mail style self righteous outrage is getting on my nerves.

    1. sliderule says:

      This guy topped them all !!

  27. Tevin says:

    I will never buy another BMW…and I have had three.

  28. Anssi says:

    I agree, BMW is not handling it well.

    I got the impression that there was a ‘fight’ in the meeting of the Board of Directors at BMW – and obviously Mario Theissen wasn’t happy with the outcome.

    So, what I am thinking is perhaps there are some in the Board of Directors at BMW to whom it is a question of their ego to prevent the F1 team surviving. When big egos *in charge* get to work and decide something stupid then no amount of sense will help to counter that.

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