Hot fun in Summertime
Budapest 2014
Hungarian Grand Prix
Thoughts on the new Concorde Agreement
News
Thoughts on the new Concorde Agreement
Posted By: James Allen  |  04 Aug 2009   |  4:04 pm GMT  |  17 comments

War is over, at least for a short while.

On Friday night the teams, the FIA and the F1 commercial rights holder signed the new Concorde Agreement, which runs until the end of 2012. With the signature of this agreement stability is returned to F1. There will be no breakaway series, no more new rules being imposed on teams, the F1 commission will be restored, which gives the teams a say in the new rules.

It has been an immensely damaging period for the image of the sport, with polemics, breakaway threats and constant instability. Just how damaging will become clear in the next few months when we see if any new sponsors and major corporations are attracted to come in and invest.
FIA FLAG
After so much strife the wording of the FIA’s statement was interesting. Max Mosley was portrayed as presidential, his cause helped by the shock pull out last week by BMW, which reminded everyone of how manufacturers behave and why Mosley went to war with them on costs in the first place.

“Following approval by the World Motor Sport Council, late last night FIA President Max Mosley signed the 2009 Concorde Agreement, heralding a renewed period of stability for the FIA Formula 1 world championship,” said the FIA’s statement.

“The WMSC has also approved a slightly revised set of stable sporting and technical regulations (to apply from the 2010 championship onwards), which have been agreed by the FIA and the teams and which will be published shortly on the FIA’s website.

“The new Concorde Agreement, which runs until 31 December 2012, provides for a continuation of the procedures in the 1998 Concorde Agreement, with decisions taken by working groups and commissions, upon which all teams have voting rights, before going to the WMSC for ratification.”

The problem is that next time around the teams are committed to getting a much improved share of the commercial revenues from the sport, which will set them on a collision course with Bernie Ecclestone and his partners CVC. So we will have stability for a couple of years and then the fighting will start again. We will also have a new FIA president in October, in all probability Jean Todt, so the dynamics will be different there and he may well want to make his mark on the next Concorde Agreement.

There are some senior team figures in F1 who believe that they should all sit down now and agree a deal from 2013 to 2023, capitalising on the spirit of togetherness which led to the new deal. But it’s hard to imagine the manufacturers wanting to commit themselves for that long this far out, so you can see that opportunity slipping by.

I think everyone at the top in F1 shocked themselves with the breakaway decision during Silverstone weekend and will be very keen to avoid a repeat. But at the same time the teams feel that it is wrong for so much of the commercial revenues of the sport to go into servicing CVC’s $2.6 billion debt, (some $300 million per year) rather than being shared out among the participants.

So let’s enjoy the moment’s peace before the next showdown.

Featured News
MORE FROM JA ON F1...
Share This:
Posted by:
Category:
Tags:
17 Comments
  1. MikeR says:

    Am currently reading “Bernie’s Game” which puts all the recent shenanigans into perspective. Recommended reading.

  2. Snail says:

    I think everyone at the top in F1 shocked themselves with the breakaway decision during Silverstone weekend and will be very keen to avoid a repeat.

    I think the teams now have a tremendous multi-year opportunity to arrange a new series, new venues, new governance, new finances, new TV deals, etc. Plus all the team deals end at the same time.

    Bernie always tries to scupper this by doing different deals with different teams at different times to prevent alignment (Williams signing up early vs FOTA for example because Williams had no choice).

  3. Ahmed Youssef says:

    $2.6Bn you mean :)
    Great article as always

  4. Casino Square says:

    On CVC’s debt, surely you mean $2.6 billion…

  5. john g says:

    in the new era of transparency, are we going to see any details of the new concorde agreement?

    1. James Allen says:

      Don’t hold your breath

      1. The last one was never officially released (though I’ve seen a leaked version somewhere on the internet) and the FIA still haven’t released the stewarding explanations promised last season yet. James is absolutely right…

  6. artorwar says:

    I almost don’t believe it. Good news is good news though and hopefully we can get back to quivering with excitement about the next race. CVC do present a big problem but who knows what the next few years will bring them commercially so I doubt a far reaching 2033 contract would be worth the teams while for some time to come. Great to see everyone getting all fluffy and loved up for a while haha.

  7. rpaco says:

    I thought the new agreements THIS time included a better shareout of the money.

    Ahmed and
    Casino:
    James said $2.6 billion so what are you on about. I wonder why the debt was that big because Bernie got the rights for a song originally.

    Any one who signs for more than 4 years is an idiot, in fact two years would be preferable, things will be very different in two years time. Bernie will be looking to cut back the money he gives the teams not increase it. Costs will be lower though not as low as predicted, the image of lower costs will be there and the supposed team profit centres will be wondering where the theoretical profit has gone.

  8. I can’t see the teams agreeing to CVC’s involvement after 31st December 2012.
    After all, they’ve got the real power after all the team’s legal agreements with FOM expire.

    Bernie can’t go on for ever and when you are his age, three years is a long time. If he’s no longer around in 2012, all bets are off.

    Never mind CVC, The FIA looked over the abyss and didn’t like what the breakaway would have done to their income stream.

    Whoever makes the first move, I reckon the FIA will be sidling up to the teams and cutting FOM out. The successor won’t be called “F1″ of course, but what’s in a name ?

    It will be organised by the teams and sactioned by the FIA.

    Control will finally rest where it should have belonged all along : with the teams.

  9. Robert McKay says:

    Surely we’re at least going to find out roughly what these “resource restriction” regulations entail?

  10. kookiez says:

    Does this mean that next years calender can be sorted out as it is well over due.

  11. Mon Pen says:

    “We will also have a new FIA president in October, in all probability Jean Todt”

    That’s an appalling thought. I thought it was just places like Russia and North Korea where an outgoing leader was allowed to name his successor so he could carry on pulling strings? FIA – plus ca change….

  12. Werewolf says:

    The damage inflicted to the sport by this year’s wranglings will be significant. The question is not whether new corporations become involved but whether those currently associated stay on board. A sport that has trumpeted massive expenditure, unclear governance that does not inspire the confidence of the public and a profit-share system biased almost to obsenity in favour of the commercial rights holder, so that circuit owners, promoters and even participants barely profit at all is unlikely to top boardroom shopping lists during a recession.

    The much-heralded stability will take considerable work to sustain during the next three years. F1 has taken a much smaller step than it (at least publicly) recognises and more change is yet needed for a genuinely lasting prosperity, whoever the major players turn out to be.

  13. Tom says:

    Any idea which parts of the 2010 sporting and technical rules have been “slightly revised”? No official word from FIA yet.

    1. James Allen says:

      No still waiting for that page to refresh

LEAVE A COMMENT

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Top Tags
SEARCH News
JA ON F1 In association with...
Download the chequered flag podcast today
Download the chequered flag podcast today
MTS
Industry-Leading Testing and Sensing Solutions
Multi award winning Formula One photographer
Multi award winning Formula One photographer