F1 promoter Bernie Ecclestone has confirmed to the Daily Telegraph that the automatic $10m prizemoney payments made to the “new” teams which entered F1 in 2010 are to end. From now on only the top ten teams will receive money each season.
This makes the battle for 10th place in the constructors’ championship more intense than ever, with Caterham and Marussia vying for the final position. Currently Marussia holds 10th place due to Jules Bianchi’s 13th place in Malaysia.
When former FIA president Max Mosley pressed for the new teams to enter the sport, Ecclestone agreed to pay them each $10m per season, in lieu of prize money. It is this which is now to end.
The pressure is greater on Marussia, as the Banbury based team does not have a bilateral commercial deal in place with F1 for its continuation in the sport until 2020. All of the other ten teams including Caterham have such a deal, which guarantees them a share of the commercial revenues of the sport. The shares are not divided equally between teams with Ferrari earning significantly more due to its historic involvement in the sport. But as a guide from now on the teams are set to share 63% of the sport’s operating profit, on turnover of $1.5 billion.
This is the only agreement in place at the moment in the absence of a new Concorde Agreement. The last one expired in December last year and a new one awaits signature. The teams are ready to sign, but Ecclestone and the FIA have some matters to resolve before all three parties can sign it.
However Ecclestone also indicated to the Telegraph that the board of F1’s parent company had indicated its desire to press ahead with the delayed flotation of the sport later this year. For this to happen there will have to be a Concorde Agreement in place. So there are still a few issues to resolve and there are some powerful figures within F1 who do not want the business to be floated.
Plans to float on the Singapore exchange were put on hold last year due to poor market conditions post the Facebook IPO and the Euro crisis.
The implication from this and other recent moves is that F1 only wants 10 teams going forwards into a post flotation future; there were brief merger talks between Marussia and Caterham over the winter but these fell apart quickly.