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“Manufacturer era in F1 is over” says Williams boss
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“Manufacturer era in F1 is over” says Williams boss
Posted By: James Allen  |  08 Nov 2009   |  9:44 pm GMT  |  50 comments

The era of manufacturers dominating F1 is over, according to Williams chief executive Adam Parr. Following a week in which Toyota announced its withdrawal and Renault held an emergency board meeting to discuss its ongoing participation, Parr said that the tide is turning away from the manufacturer teams towards independents like Williams and Brawn.

Picture 15
In an article I co-wrote in this weekend’s Financial Times, Parr said, “This week marked the end of manufacturer dominance in F1, something that had been growing for a decade, ” It’s not that manufacturers are not welcome in F1, it’s just that the maths don’t make sense. If you spend $750 million a year to own an F1 team and come ninth two years in a row, you are going to stop. For an independent at times like these you are going to put your head down and keep going, because you have no choice.”

Meanwhile all the stakeholders in F1 are wondering what Toyota’s legal position will be now. They are in breach of contract, having signed the Concorde Agreement in August. Although there is no specific financial penalty written in the agreement, they do have responsibilities and potential liabilities. For instance, as one team principal pointed out to me yesterday, if another team was on the point of signing a title sponsor and that sponsor pulled out because he was unsettled by Toyota’s move, then he could have grounds to sue Toyota.

Many commentators have underestimated what Toyota’s position entails, and it is the complexity of the legal responsibilities linked to being in breach of contract which the Renault board will have been discussing this week, along with seeking an honest assessment from its commercial team of the chances of securing sponsors for next season, with the cloud from the race fixing scandal still hanging over the team. My sources suggest that Renault will definitely compete in 2010, but will review the position again after that. They will be studying what, if any, legal challenges Toyota face during that period.

Unlike Honda and to a lesser extent BMW, Toyota have not done the right thing here; they have signed the Concorde Agreement and then breached it, they have not sought to set the team up to continue in future.

The question of the 13th team remains; will Sauber get it? I’m sure they will, but contrary to rumours this weekend, I understand that Qadback has not yet paid BMW the money for the team, that is contingent on them getting the entry ratified by the FIA.

I spoke to McLaren boss Martin Whitmarsh this week and he said that Toyota was ‘not integral’ to F1 – which is a corporate way of saying they won’t be missed – and that FOTA is still in robust shape because its strength is Ferrari and McLaren. Like BMW, Toyota have not helped the manufacturer’s cause this year because they have merely served to prove the accusation that manufacturer’s come and go when it suits them.

Interestingly both sides in the FOTA/FIA war over the summer failed to get all that they wanted in the final negotiations. The FIA wanted the manufacturer’s boards to commit to 2012, not just the race teams, while Toyota and other manufacturers were keen not just for Mosley to stand down, but for Bernie Ecclestone to do so as well. Toyota were looking for different corporate governance for F1 and were reluctant signatories of the Concorde Agreement.

I sense that FOTA as an organisation is weaker now, because it has lost some manufacturer muscle and once the new teams join, they will be much more likely to side with Ecclestone, who holds the purse strings, in the event of a dust up. It also cannot help that Ferrari has once again publicly belittled the new teams this week, saying “Formula 1 continues losing important parts. In exchange, if one could call it that, Manor, Lotus, USF1 and Campos Meta arrived. You might say, “same-same” because it is enough if there are participants. But that’s not entirely true and the we’ve got to see if next year we’ll be really as many in Bahrain for the first starting grid of the 2010 season.”

Over the summer Ferrari said that many of these teams were more GP3 than F1. Some of them are already FOTA members and others have applied for membership – happy families!

Also in that FT article we got a quote from a spokesman for Jean Todt’s new regime at the FIA, who said that the events of this week prove that, “The FIA’s strategy of cost reduction and the encouragement of new independent teams was the right one for the championship.”

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  1. marcus says:

    James: one or two people have commented about Toyota’s breach of contract and the concomitant financial and legal risks this triggered as if the world’s largest car manufacturer is too dim either to hire the right people to understand the contracts they sign or at least talk to people who might know. Are they stupid or is it more a question of making the wrong decisions at the wrong time?

    My personal feeling is that Toyota are unlikely to reap the whirlwind some seem to think possible because the sentiment and wrangling that drove the pathological desire to keep the manufacturers from leaving in the first place is also likely to drive a desire not to antagonise potential suitors by your treatment of those trying to leave. I think if they go quietly, don’t contest Sauber’s grabbing of their place and don’t make any nasty comments about F1 governance or otherwise in their exit they will probably go quietly into the night and Bernie will say thanks very much for all the cash in the meantime.

    1. James Allen says:

      I don’t think they are stupid, I think they must be hoping that no-one will want to take them on legally.

      1. Steve says:

        Didn’t Honda fail to appear under the prior Concorde?

      2. James Allen says:

        There was no Concorde in place last year it had lapsed and not been renewed, that’s the big picture behind what happened in the first half of this season.

  2. Michael Grievson says:

    The comments from Ferrari were unfortunate. James, now that the grid will be pretty much privateers from 2011 if Renault leave do you think ferrari will reconsider their position? Afterall they will no longer be competing against the top car mnufacturers in the world. Would that affect their image?

    1. James Allen says:

      I don’t think Renault can leave, in the first instance. I also don’t think Ferrari will mind racing against only one other manufacturer (Mercedes). And you can be sure that manufacturers will come again in a few years time, let’s hope that when they do the right cost regulation structure is in place.

    2. explosiva says:

      I honestly don’t think Ferrari’s comments about the new teams are so insulting. New teams should have no illusions about how difficult it is to succeed in F1. At this point, the new teams aren’t that important in many ways. It’s up to the new teams to prove Ferrari wrong. They can be puerile and huff and puff at being disrespected by the Scuderia. Or, they can be mature and dedicated, letting Ferrari’s belittling comments be their inspiration to succeed.

      1. Just A Bloke (Martin) says:

        well said, intelligent post.

        I dont think Nick Wirth, Mike Gascoyne et al. will be too bothered.

  3. rpaco says:

    If you sue for breach of contract I suppose you have to prove direct consequential loss.

    I wonder why Ferrari is doing this, I mean are the new teams supposed to be scared and give up or what?

    To cast themselves as bullies belittling new entrants does not endear them to thousands of “Ferrari neutral” F1 fans. It sounds rather childish.

    What are they going to be like with many rookie drivers on the track next year? Will there be a new rule for rookies “If you see a red car coming you must slow down”

    We know that they had unequal advantage from the previous concorde agreement are they not able to compete without some sort of headstart?

    I trust they will receive due international ridicule for their tactics.

  4. Steve JR says:

    It’s absurd and childish that Ferrari continually make these negative, belittling comments about the smaller teams that represent the new blood in F1. Ferrari had better hope they lose no points to them next season, or they’ll look all the more ridiculous. It will be interesting to see how the new teams slot in once the season gets underway, and with the likes of Gascoigne in their midst, Lotus might even score a few of those points.

    1. davidturnedge says:

      It is absurd and childish, but Ferrari is the ONLY manufacturer who has stood by the World Championship through thick and thin. They have a special place in F1 as manufacturer and team.

      1. Femi Akinz says:

        I hate hearing this Ferrari have been around since the dawn of time crap.

        Whilst this is true,the simple fact is you cant be around before you were born. Williams and McLaren have never left since they joined F1 so how does this make Scuderia any better than them.

        I would rather you bigged them on their passion for racing and brand F1 relationship

        Femi

      2. Joe Angers says:

        It does sort of remind one of Enzo Ferrari snidely deriding Lotus, Vanwall, Cooper, Tyrrell and the other British teams as “garagistes” not worthy of Ferrari’s concern. He made pretty much the same comments later on in the 70′s and early 80′s to about McLaren and Williams. Must be a cyclical thing with Ferrari.

        What Ferrari seems to be forgetting is that the recession is going to affect manufacturers like Renault and Toyota differently than it going to affect Ferrari.

        Joe A.

  5. Y Fung says:

    What Toyota have done is dishonorable in accordance to their culture. To sign the Concorde Agreement then decide to pull out after a few months leaves them holding their heads in shame and embarrassment. You can;t expect to sign a piece of paper and expect to walk away from it.

    Toyota have achieved very little in F1 other than spend lots of money with no championships or race victories which is a huge disappointment given their reputation in the car market

    They will not be missed as they have contributed little in their 9 years of F1

  6. Silverstoned says:

    “Keep your head down and keep going as you have no choice”
    James, do Parr’s words apply to any independents other than Williams?
    Would I be right to assume that Williams alone has never wanted to sell out to bigger fish?

    1. James Allen says:

      They have looked at options and rejected them. But I sense that they are now looking to the next stage – post Frank and Patrick. A sale must be on the cards in the next five years for Frank to exit with his team on a positive path and Patrick to get a return from his equity.

  7. Brace says:

    Lately, it’s been easier to like Ferrari than Williams and that says A LOT!

  8. A. N. Other says:

    “For an independent at times like these you are going to put your head down and keep going, because you have no choice.”

    There are other possibilities Mr. Parr didn’t mention.

    Lack of sponsor money could very well lead to insolvency and the dissolution of companies like Williams. Of course, that’s as unlikely as the Concorde being removed from service …

  9. mark says:

    You have to agree with Ferrari’s position to some extent, they want F1 to be seen a racing’s world stage that reflects the values of their customers.
    Competing against other major manufacturers such as BMW and Toyota carries significant weight in itself… competing against manor and campos doesn’t carry quite the same weight. Especially to a potential ferrari buyer who doesn’t follow F1.

    1. Med says:

      I see it more of an elitist comment, in that they want F1 to be the domain of the rich, rather than let the riff-raff eat from the same table.

      The first full season I watched was when F1 went to ITV in ’97 and Ferrari were the only manufacturer.

      With Mercedes buying into McLaren and Jag buying out Stewart in 2000, there were 3.

      2002 – Toyota appears and Renault buy out Benetton – 5.

      2005 – Jaguar have dropped out and back down to 4

      2006 – BMW bought out Sauber and Honda bought out BAR making it up to 6.

      2009 – Honda have gone – 5

      2010 – BMW and Toyota gone – 3

      It averages out at just under 4 manufacturers per season, so next season will be pretty much par for the course.

      Personally, I couldn’t care less about whether it’s manufacturers or independents racing, I just want to see some close action. The argument about Ferrari racing against Manor and Campos not carrying the same weight to a potential Ferrari buyer that doesn’t follow F1 is a moot point – if they don’t follow F1 they wouldn’t know if they were racing against manufacturers either.

      1. mark says:

        you make a valid point… but one has to wonder, if the sport involved more manufacturers and less privateers, would you be able to have more innovation and less regulation?
        ie: because manufacturers have more resources available (they used to anyway) would you need less regulation to keep the playing field level… with the private teams, there is so much regulation just to keep the racing close.

      2. Med says:

        Nowadays you’re probably right, I think back when these cars were designed with a pen and paper, then a clever engineer could have a marked effect on a car’s performance – think Lotus and early Williams; nowadays it’d be whoever can afford the best computing power to crunch all the numbers.

        However, since the teams have agreed on “resource restrictions” or whatever they’re calling the “anything but a budget cap” it’d be nice if the FIA loosened up the regs a bit, or, since they’re awful keen on banning everything, ban the use of computers in designing the car.

  10. Peter says:

    What else would he say? People say manufacturers coming and going, but I am sure we will see more small private teams to come and disappear. F1 never will be as big as it has been with the manufacturers.

  11. Grockle says:

    With all the technology and tyre restrictions in place there is very little scope left for innovation that the manufacturers can trickle down to their road cars.

    I think the last few years have proved very well that in the majority of cases, Brawn excepted, the tighter you regulate the design specs the less chance the independents have of using inspiration to beat the big boys.

    I’d love to see F1 brought back to it’s true prototype role but within a constrained budget.

    At the moment, watching F1 feels like watching a bunch of battery farmed hens being cooped up and expected to produce a standard sized product no matter what their DNA is like.

    Just imagine how the engineers would feel if they were once more allowed to roam free range and to use their brains in the way that an engineers brain should be used.

    You’d still get the occasional end product covered in poop, but you’d get far more double-yolkers and consumers would be left with a much better taste in their mouths.

    1. Monktonnik says:

      Excellent analogy.

      I have rather Pythonesque image of Patrick Head and Adrian Newey jumping a fence on a souped up push bike and riding off through the fields making aqualung noises.

      1. Monktonnik says:

        Sorry that should squawking. A curse on predictive texting

      2. Stephen Kellett says:

        It read quite well even with aqualung!

      3. mvi says:

        It read especially well with aqualung! And the predictive texting cracks me right up. Fabulous imagery, guys!

  12. Although I am a fan, I find it strange that people out there are finding it hard to like Williams at the moment. All I can see is an independent team fighting its own corner, looking after its own staff and trying to get itself in a competitive position come hell or high water, as they do indeed have no other option.

    These are the ideals F1 was built on, and I for one respect the fighting spirit displayed by Williams in recent years. They will not, under any circumstances, give up. Fair play to them.

  13. Aaron James says:

    Seems to me the end of the manufacturer era in Formula 1 also means the end of the mega corporate era in Formula 1 too.

    Many of the big companies that filled the gap left by big tobacco did so because of the B2B relationships they could form with other likewise huge companies.

    With the exit of BMW, Toyota, Honda and probably in one shape or another, Renault (not to mention the loss of their marketing budgets) it’s hard to see F1 retain its current level of corporate interest.

  14. Steve JR says:

    Good point sir. I was forgetting about the unspoken rule that longevity in a sport implies permission to be rude about one’s competitors

  15. Fausto Cunha says:

    Ferrari don´t care about budgets, they spend all they can to win.
    They want a championship full of manufacteurs teams, but those teams are losing millions and they don´t want to continue.
    They don´t want smaller teams like the new teams because their not up to F1 standards.
    They want to have 3 cars, nobody wants that besides them.
    Maybe they want 11 ferraris vs 11 mclarens!!
    I think someday they will be alone and against all the other teams.
    They are losing power and they hate that!!

    I don´t regret BMW and Toyota departure from F1 , but i would like them to continue as engine supliers to other teams.

    There´s a lot of clever people on the F1 smaller teams, let´s hope they make a good job and take the fight to the bigger teams, that´s what F1 needs.

    1. Jim Belfast says:

      I think its a bit like the top European Football teams wanting a Euroleague. Real Mdrid get more out of beating AC Milan than they do Mallorca.

      Ferrari get more out of beating “big names” like Honda, BMW, Mercedes, than they do Manor or Campos.

      Also losing to a Torro Rosso or a Force India doesn’t sit any better with Ferrari than it does with Real madrid when Mallorca beat them.

      However, being beaten by Williams or Red Bull is easier to take as they are “ESTABLISHED”.

      What Ferarri want is to be racing established teams with established drivers. So thats why they fret when BMW and Toyota leave as they are established names.

      We need the 4 new teams to have staying power and become established. Even Brawn as an entity may disappear after just 1 year.

      1. Fausto Cunha says:

        I understand what you´re saying.

        Ferrari hasn´t provided any better solution to help those manufacteurs staying, they were losing money, so they walked away.

        The teams needs sponsors, big names like Red Bull, that´s what the new teams need , sponsors that provides resources to develop and become established like you said.

        F1 is very expensive, I was thinking in going to Barcelona to attend the grand prix in last May but i live in Potugal and i would spend arround 900 euros to do that, almost half of that on the ticket for the race, for me that´s impossible.

      2. Fausto Cunha says:

        Portugal(sorry for that)

  16. Brace says:

    To quote some funny clip: I don’t wanna watch Formula Cosworth driving slowly around Asian tracks. :D

  17. Stephen Kellett says:

    For instance, as one team principal pointed out to me yesterday, if another team was on the point of signing a title sponsor and that sponsor pulled out because he was unsettled by Toyota’s move, then he could have grounds to sue Toyota.

    And little green men from Mars are parading in my back garden…

    You cannot sue an unrelated 3rd party (Toyota) for the failure of a second party (sponsor) to act. Well you can, but you’ll lose. Merely being a competitor in the same series does not make you related.

    Any doubts about Toyota related to engines will be covered by the engine supply contract and any penalties therein. No requirement (or grounds) to sue.

    I know you are not reporting your opinion, but I think whoever provided this opinion to you wasn’t thinking that clearly when they provided it.

  18. Phil says:

    The opportunity now exists for the privateers, old and new to grow, develop, strengthen and push themselves toward the sharp end of the grid, albeit with Ferrari, Renault and Merc in the mix. When the manufacturers inevitably begin to return they’ll be up against some strong opposition on track. I’d like to see the manufacturers back but as JA commented, hopefully F1 will be better prepared.

  19. Graeme says:

    James

    What I don’t understand about Renault, is that when they faced FIA hearing, they commited to FIA/Formula 1 etc. They cleaned there house up and were here to stay. Now a few weeks later they are revising it. I suspect they are battling to get a title sponsor and with so many more teams, title sponsors are even harder to get never mind economic conditions we are in.

    1. john g says:

      there’s a very distinct difference between renault F1 race team and the renault board. similarly, BMW race team / board, and toyota race team / board.

      1. Neil Williams says:

        But was the ‘let-off’ Renault received within the WMSC hearing conditional on their continued participation, James? Could punishment be applied retrospectively should they decide to pull out?

  20. Vinod says:

    Typically i would see a breach/change of 2-4 year contract mid-term as an exception not the norm. It appears one cannot trust F1 entities be it teams or drivers, to stay true to the word on a contract in today’s world. For instance this year alone look at the digressions – Toyota is quitting despite making all that noise couple months ago, Force India vs Aerolab, Ferrari dropped Kimi (which i still find it hard to fathom given the amount of money involved in the transaction especially in this tough economy!), Alonso quitting Renault, Williams – Toyota engine deal, the list goes on and on.
    This sort of mistrust is disheartening. If I had a business and I think about sponsoring a team / driver, I will be really uncomfortable to see these many digressions. Should I trust my partners or not? Plus we are not talking about those ridiculous 100 year contracts. These are short term contracts that is not difficult to foresee. Why even bother to pay a bunch of lawyers and draft a contract?
    I live in the US. I don’t see this many changes in NFL for example. Typically something really bad has to happen to trigger a change in a short-term contract.

    1. Charlie says:

      All these contracts have exit clauses. Welcome to the real world.

  21. Max Blake says:

    James Are you not a professional journalist? “The Maths Don’t make sense”! REALLY! What would would your English Teacher say?!

    1. Med says:

      “I wish I made as much money as him”?

  22. john g says:

    “a quote from a spokesman for Jean Todt’s new regime at the FIA, who said that the events of this week prove that, “The FIA’s strategy of cost reduction and the encouragement of new independent teams was the right one for the championship.”

    read: the FIA’s strategy of completely failed cost saving, lack of technical freedom, continued poor governance and leadership, and poor exposure through pointless race location, has thoroughly worked to dissuade manufacturer teams, and given all that was required in order to compete as a new team next year was to tick the ‘cosworth’ box, the FIA can conclude they did everything needed to to create an environment where manufacturer teams could not remain and new teams were signed up.

    i have to say, i’m pretty disillusioned with F1 right now. having lost my job with one of the teams, and the constant decline of the way the sport is run (which is clearly set to continue) i can see another form of racing, one that appeals to the humble fan, race teams and circuits, coming up to challenge F1 as the pinnacle of motorsport. a euro equivalent of ALMS centred around the masterpiece of the le mans 24h, full of manufacturers free to demonstrate their technology in front of their markets, at tracks that aren’t financially crippled and full of passionate fans, free from constant interference by the FIA… vs the Asia & middle east cosworth challenge…

    1. Jim, Belfast says:

      Id love to agree with you but i think the pull of F1 will always live on. GP2 is a great series with great cars and very exciting, A1GP has decent cars and is a good idea but noone is warming to it.

      Indycars lacks the appeal of F1 too. F1 just has the “Real Madrid” or the “Hollywood” feel about it. We will never be happy unless we see 5 overtakes per lap or the madness of GP2.

      I think that FOTA and the FIA are waking up to what needs to change i.e. lower costs, more standardised equipment without the loss of identity, more teams/cars, better tracks with overtaking opportunities, and lower admission fees. Unfortunately the pioneer of such was Mr Briatore so i just hope someone picks up his mantle.

      For me half the problem is track design. Why is Monza and Hockenheim still better viewing than the new circuits. I think Mr Tiike has a lot to answer for.

  23. Jim, Belfast says:

    James what potential outcome do you see from the MSC N Technology court appeal. If they win surely the only outcome would be compensation as there is no grid slot available?

    Or are there other potential outcomes?

  24. John Snow says:

    Tenuous Renault link but have seen this?

    http://cgi.ebay.de/ws/eBayISAPI.dll?ViewItem&item=150386832229

    Half way down, it says:

    “The car is in-original state as in the 1994 F1 season, with paddle-shift and traction control.”

    I always knew they were cheating! More races (and a championship) that Pat and Flav won by cheating!

  25. Tim L says:

    Adam Parr….Much like FW…he has nothing to say….wroth listening to or reading about !

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