Angry Ron Dennis steps down as McLaren boss: “entirely spurious” reasons for boardroom suspension
McLaren
Posted By: Editor   |  15 Nov 2016   |  5:57 pm GMT  |  184 comments

After a long running board room feud, legendary F1 team boss Ron Dennis has been forced to “relinquish his duties” as the chairman and chief executive of the McLaren Technology Group.

As reported here during the Brazilian Grand Prix weekend, Dennis failed in an 11th hour attempt in the UK High Court last week to prevent his fellow McLaren shareholders – Mansour Ojjeh and the Bahraini Mumtalakat wealth fund – from suspending him on gardening leave until his contract expires in two months.

The 69-year-old had promised to find backers to buy Ojjeh and Mumtalakat out of their shares – between them they own 75 per cent of the McLaren Technology Group – and take overall control of the group. But despite a last minute bid with group of Chinese investors that situation has not come pass and he will leave his post as head of McLaren, a position he has held for 36 years.

In a statement released by McLaren, Dennis expressed his displeasure at the situation and dismissed the grounds for his suspension as “entirely spurious”, but vowed to honour his existing commitments to McLaren.

Ron Dennis

He said: “I am disappointed that the representatives of TAG and Mumtalakat, the other main shareholders in McLaren, have forced through this decision to place me on gardening leave, despite the strong warnings from the rest of the management team about the potential consequences of their actions on the business.

“The grounds they have stated are entirely spurious; my management style is the same as it has always been and is one that has enabled McLaren to become an automotive and technology group that has won 20 Formula One world championships and grown into an £850 million a year business. Throughout that time I have worked closely with a series of talented colleagues to keep McLaren at the cutting edge of technology, to whom I will always be extremely grateful.

“Ultimately it has become clear to me through this process that neither TAG nor Mumtalakat share my vision for McLaren and its true growth potential. But my first concern is to the business I have built and to its 3,500 employees. I will continue to use my significant shareholding in both companies and my seats on both boards to protect the interests and value of McLaren and help shape its future.”

XPB.cc Fernando Alonso Ron Dennis

Dennis, who has so far been overlooked by the British Government for a knighthood, despite his rival Sir Frank Williams and Sir Patrick Head of Williams both being favoured, explained that he has plans to create a new technology investment fund once his contract has expired.

He said: “I intend to launch a new technology investment fund once my contractual commitments with McLaren expire. This will capitalise on my expertise, my financial resources, together with external investment to pursue the many commercial opportunities I have been offered in recent years but have been unable to take up while being so committed to the existing business.”

According to the McLaren statement, Dennis will remain on the boards of both the McLaren Technology Group and McLaren Automotive and is still a “significant shareholder in both companies”.

Fernando Alonso

The McLaren F1 team is currently sixth in the 2016 constructors’ championship with 75 points, and Fernando Alonso is its best place racer in the drivers’ standings in 10th place. His teammate Jenson Button will take a sabbatical next season and Stoffel Vandoorne, who scored the team’s first point of the season when he replaced Alonso in a one-off appearance at the Bahrain Grand Prix, will take his place in 2017. Alonso and Button finished 10th and 16th at last weekend’s race at Interlagos.

McLaren has not scored a podium finish in F1 since the 2014 Australian Grand Prix, when Kevin Magnussen and Button were second and third, and its last victory came courtesy of the British driver at the 2012 Brazilian race.

James Allen view: This news comes as no surprise, given the events of the past few months and even years at McLaren. They say in politics that “all great careers end in disappointment” and this is certainly true of this proud man, who has fought against all kinds of odds down the years, but who ultimately lost support from those closest to him in business.

I always said that Ron was the best and the worst thing about McLaren. His drive, energy and vision have made the company what it is and few could be bothered to invest the energy and obsessive attention to detail that he did into his work.

But the other side of his obsessiveness, his abrasive and at times high-handed manner and his blindness in certain crucial areas, ultimately caused problems and meant that the culture of the F1 team wasn’t quite right in recent times and the team didn’t achieve the success it could and should have done since the mighty Senna/Prost/Honda days of 1988-91.

The culture and tone he set were right for F1 at one time, but not for today and now a new culture will emerge at McLaren, more cosmopolitan, multi-national and supportive under Eric Boullier, Jonathan Neale and perhaps Zak Brown as a management trio.

Dennis has been a pioneer in taking F1 technology and applying it elsewhere and McLaren Applied Technologies is a world class tech company. It seems very appropriate that he should look to set up a technology fund as his next move. It’s the kind of thing that might finally bring him recognition from his country.

What do make of the news that Ron Dennis will leave his posts at McLaren? Leave your thoughts in the comment section below or head over to the JAonF1 Facebook page for more discussion.

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1

Such a pity McLaren have let such an influential person as Ron Dennis go. So I see it, it’s all about money and Company power to sell to the highest bidder and not preserve a heritage of British Engineering at it’s pinnacle. He has dedicated so much to the Company and shows what a British Company can do in an otherwise technological world. I always looked up to Ron as HE was McLaren. I know ONE man doesn’t make a Company but Ron was this Company.
Such a pity. A big loss to McLaren.

2

How come Ron Dennis and Niki Lauda never wear Mercedes or McLaren logos on their clothes at the race track? Why do the broadcasters always preface Niki Lauda’s title with NON-EXECUTIVE? It sounds like a left handed insult all the time.

3

I can sympathize with Mr. Dennis, having been ‘chased’ out of a much lower-level job when management changed and rewrote the job description. Not being able to come up with some usable plan to get sponsorship money is a critical failure in today’s F1 though, and it’s easy to see the other point of view.

4

I’ve met Ron Dennis personally and he’s an absolute prince of a man, a gentleman’s gentleman. McLaren has more phenomenal history in its stables than most of the others combined. If there’s some kind of a power struggle going on, Ron Dennis isn’t to blame.

5

The man created a great team, won world championships, created beautiful sports cars and road cars and did it all in Britain.

As an F1 fan in McLaren’s fanclub, I got to visit the McLaren Technology Centre, visited the pre-British Grand Prix test at Silverstone, went on a club organised trip to the Belgian Grand Prix (with a staff member on the bus) where DC won, got a trip into the paddock after qualifying and got a commemorative polo shirt.

Last but not least, twenty years ago, McLaren made a one-off offer to fanclub members to purchase a Tag-Heuer watch at 60% off the retail price.

How many F1 teams do all that for ordinary fans?

I cannot praise Ron Dennis enough and I cannot imagine how anyone else is going to take over and do what Ron has done.

6

100% agree with you Eddie 👍

7

So where does Capito sit in all this? Too many cooks and all that…

8

Hey James, i did not understand what other shareholders and Ron disagree. Ron is perfect man to run McLaren Group. Firstly comes my mind is profitability. McLaren Automotive sells much more cars but profitability is still too low. I do not estimate others consider F1 team as much as Ron. There is big question here, why others dont want Ron anymore ? I did not find this answer anywhere for now.

9

Ron, should buy Manor Racing after the gardening leave concludes.

10

Another F1 Legend is ousted from his Game of Throne. 👑King Ron is no more👑.
❄I forsee a💀 harsh winter 💀coming to the Land of Mclaren ❄

11

The plain truth is, since the beginning of this century McLaren have won one WDC (just) and no constructors. Since Ron came back it has been promises promises. “We’ll win before the end of the year”. “Soon have a new Title sponsor”. “Honda’s new engine is fantastic”. In the circumstances, with the cars they have had, Fernando has been an expensive luxury they could ill afford. On strategy, in the last few years they constantly get it wrong. I think it needs a root and branch reform under a new dynamic leader or leaders who lets the various departments manage. Ron’s time, like Bernies is over.

12

James, presumably there’s a reason for the lack of a knighthood for Ron right? There usually is when an obvious candidate is overlooked, but do you know what it is?

13

2007?

14

Maybe, but I don’ think so, he was due one long before that. Sir Frank got his years ago.

15

I don’t think 2007 has anything that James and I am surprised you have suggested something that silly. This British Honours System is a farce anyway as too many underserving people get honours i nmy opinion. Our government in Britain don’t really bother much with F1 . It doesn’t fund the British GP and its ultimately the government really that puts honours forward to advise The Queen and i think he will get one a some point especially if he decides to help with Brexit in some capacity and gets us trade deals.

16

A sad day for everyone when a legend is humiliated. RD has his strengths and his weaknesses like everyone else, but not even his detractors can take away from him what he has contributed to F1 over decades. However, he is 69 and things do move on. No doubt he will continue to contribute somewhere and somehow – that seems to be his nature. I wish him well and he will not be forgotten in F1, over time, most likely for his achievements – that is the way of the world.

17

Well a look through here and im non the wiser. A million points of view with no reference to any facts.
this obsession with sponsor blurbs need to be put in perspective. The honda deal meant free engines and massive input. They demanded the top drivers and were willing to pay their salary. Thats 100s of millions right there plus the hope they would develope a killer engine. Thats the only bit that just didn’t happen fast enough. At the end of the day he still holds 25% and will no doubt gleefully hold feet to the fire at board meeting.So probably his favourite activity is intact lol.

18

I am quite surprised by lack of knowledge displayed in some of these comments here, specifically related to Mr Mansour Ojjeh, who seems believed to be just another one of those pesky Arab money-grabbers.
Ojjeh became a partner in McLaren back in 1983, only two years after Ron Dennis’ takeover of the team and has most of the times held the same number of shares as Dennis, from 50-50% in 80s to 25-25% that we see today. He is a man who not only had vision (like Dennis) but also money to invest into TAG-Porsche engines that have given McLaren two WCs. Being such a part of McLaren history I invite this site to do an article on this, for the team equally important man, who has always remained in Dennis’s shade.
Regarding ousting of Ron Dennis – things are very simple. Majority owners of a company, irrespective who they are, are in control and can remove a president or a CEO more or less as they please, ‘entirely spurious’ reasons or not. Dennis should have known this and left with more dignity once his welcome has expired.

19

We will respond accordingly

Thanks!

20

It was always going to end this way with Ron, given his personality traits. He’s been an awesome presence in F1 and McLaren. It’s a good time for a new leadership to get bedded in.
Brutal changes are quite normal in F1 after all, look at the way that drivers are dropped and swapped, or how engineering talent is forced into gardening leave between appointments.

For once I’ve quite enjoyed the comments section, who knew that ‘F1 racing experts’ were also supremely self-confident on management and team ownership issues?

JAonF1: only about 50% of my comments make it through from ‘waiting moderation’ to the page. Is there something I can do to fault find? The page doesn’t retain my login either

21

I have always felt Mclaren post Senna & Prost became too Clinical & soulless. I get things move on but the road car side after the F1 came out felt too prioritised. Mclaren are not ferrari ,thankfully, but they need to build their own future. Ron always seems to me like the classic dictator which in a diversified project does not seem to work unlike Bernie in F1 who like him or loathe him seems to keep things going. I like the sound of the people James put forward to keep mclaren moving forward. Basically all above is because I’m still annoyed we don’t know the P1 Nordschleif time .

22

He is just not in control anymore, but he is still 25% shareholder and he will always be Mr. McLaren. I just hope we still will see him in the paddock from time to time.

A return of Martin Whithmarsh would probably make that impossible. McLaren needs new faces (or old faces) e.g. Boullier and Allison would be great.

Make McLaren Great Again!

23

While Ron’s contribution is massive, the team has been on a downward slide for some time. I think his mishandling of Alonso during those acrimonious times in 2008 together with his failure to land a ‘title’ sponsor these past years due to overplaying his hand rank as major blunders. His less than courteous handling of people, and drivers such as Jenson Button and KMag also leave much to be desired. Time will still tell whether his gamble to go into partnership with Honda will prove to be inspired or will continue McLaren’s slow slide downwards? I guess something had to give? Or, is this merely boardroom/business and not racing related?

24

Very sad to see one of the great F1 team leaders forced out of the team he built. One can only question what those decisions & Chinese consortiums offers were. Sounds like Ojjeh and Mumtalakat were after alot more value than people were prepared to pay!.
A deal is a deal in the end and Ron has to accept that. I cant understand why Ron could not find a way to acquire a controlling stake of another 25% at least until such time till he could find investors.

Unfortunately there seems still to be significant uncertainty around F1 from an investor point of view that a company as successful and progressive as Mclaren cannot attract the right investors. Until Liberty group lay their cards on the table and we see what form F1 will take then this uncertainty shall continue.

I’m still at odds to accept how Mclaren did not achieve success through 2003-6 with Adrian Newey on board-Where Mercedes engines kept failing they should have won 2 WC easily with a better engine. Its funny despite all the pressures and recent failures at Ferrari people still say it is the best team to work for especially those who left Mclaren to go there!. Rons obsessive, scientific approach is no doubt the reason for this. Mclaren will take on the big corporate leadership we see with the other manufacturers which unfortunately is the only way forward for these big teams to survive in the future.

I was totally with Ron when he sacked Whitmarsh because there was a culture change that seemed complacent after Button settled in. But I think Rons biggest mistake was bringing Alonso back to the team after what happened in 2007 -if I were still working for Mclaren I would consider that the biggest slap in the face ever and €40m over the last few years to achieve little was always on the cards.

James, did at any point Zac Brown consult for bringing investors/ sponsore to Mclaren? Or did Ron control all of that himself?. I can see Zac doing that sort of work for Mclaren but does that require a permanent management role at Ceo level. With Jonothan Neale Jost Capito (or a replacement if he leaves) , and Eric Boullier, they already seem top heavy. Surely a leader at Rons Level must be one of the owners or his representative- Could it be Martin Whitmarsh?.

25

i’m guessing there’s some sort of agreement where ojjeh and ron have to have parity in shares, unless they were to buy each other out?

at the end of the day, ron failed to buy the other side out promptly, so can’t really blame anyone but himself. he didn’t have to oust whitmarsh on those conditions in the first place.

this isn’t about the f1 team but rather ownership of the whole group. people who comment here or other f1 sites keeps thinking f1 is the be all and end all of everything. it isn’t.

26

It’s quite telling that yesterday Samsung bought Harman in a $8 billion acquisition.
Apple and Google have already made entries into the market as the smartphone business slows.
It seems to me that both moves were – somehow – connected and dependent.
So nowadays McLaren is worth much more than when the Dennis deal was made.

The Paragon.
The building was created as a mirror of Ron’s personality.
It’s impressive but very arid to live in.
It’s grey, cold and actually bad planned in trerms of area utilization, behind the facade. See the 1st McLaren road car video to check that.
There aren’t many places for employee leasure – the anti-Google facility.
Ferrari has plants a even a stream that goes through the production line.
So one building was made thinking about a vision of technology and the other was made thinking about the human well being.

And about the Newey faillure, Adrian has his stake in the McLaren Soprano.
It was rumoured that Adrian imposed a very compact engine to Mercedes, for aerodynamic reasons.
So the engine walls weren’t strong enough to support the necessary power output. Therefore the engine had to be detuned to stop it blowing all the time.
Maybe the engine project wasn’t conceivable at that time or maybe the Merc engineer generation wasn’t the best.

27

Brown brought many sponsors to McLaren, Johnnie Walker among them as head of JMI

28

Amazing how many sponsors left or have been stolen from McLaren by others. Red Bull really rubs McLaren’s nose in it.

29

…as McLaen rubbed Williams’ nose in it when Ron was in his prime

30

All I can remember is when the board ousted Steve Jobs, the founder and brains behind Apple. Fast forward a few years and they had to bring him back because they were lost. He then revolutionizes the music and phone and computer industries. And turns Apple into the biggest financial success……Ever!
We may well see Ron returning in a few years when the “know-it-alls” leave with their tales between their legs…..Just saying.

31

Er, don’t know if you’ve been asleep for the last 5 years but this WAS the 2nd coming of Ron… and spectacular shambles it has proven to be. McLaren’s glory days are little more than a distant memory, and many current F1 fans have never known the team as a competitive force in the sport. A neutral observer would see little more than a desperate and dellusional team boss who few would give a chance of pulling the team back up to the front.

32

My hunch: The expectations for McLaren on the F1 track are very high. To achieve that you need lots of money (especially today). That requires lots of sponsorship revenue especially a key sponsor which Ron was unable to sign (unless at a discounted price). To maintain the team at the current development levels, money has to come from somewhere in the absence of sponsorship revenue. Most likely from finance underwritten by key shareholders. Ron promised to get the sponsorship funding from the Whitmarsh deal and has failed to get it.

Can anyone see Ron in a Garden? [chuckle]

33

‘Nothing is forever’….except diamonds and some may say that ron dennis is a ‘rough diamond’ considering his non aristocratic and humble beginnings as a racing mechanic. I think that it’s true to say that mclaren is a stand alone empire in its field and you don’t build empires without being super intelligent, crafty and at times manipulative and obnoxious. Ron dennis has at times worn all these labels. however alond with success you also attract enemies and that is where all this leads. It’s also true to say that ‘nothing is ever as simple as it seems’ and i am sure that there are deep divisions between the partners that we may never know the full extent of. Ron Dennis was an F1 giant and he has delivered many great moments in the history of the series. Whilst i was never a total mclaren follower, they have, over the years done more than most to sustain a high level of performance and thrilling racing. It is always sad to see someone like ron dennis ousted but he will bounce back. people like ron dennis are what we call ‘tragics’ and we should be thankful. At the age of 69 it not beyond the realms of possibility that he will resurface and make his presence felt. I certainly hope so.

34

I’s almost unthinkable for McLaren to be without Ron at the helm. Nobody will question the fact that the success the F1 team has enjoyed together with the financial and commercial growth of the group have overwhelmingly been down to the drive and energy of this one man who has sacrificed everything on the way up.

At the age of 69 Ron could be forgiven for retiring but knowing him, he will be busier than ever. Whether the Road Car division will continue to progress without Ron’s guidance must be in severe doubt.

It would be great to see him buy Manor and turn it into a race-winning team but I fear that that is no longer possible in the modern era, more’s the pity.

Anyway, he’s been there, done that. New challenges beckon.

I can’t wait to see what he does. And where is that knighthood ?
And one for John Surtees.

35

I don’t see Ron going quietly, and a lot of people in F1 consider him to be a fixture. But consider …

Since 1991 – which was the last year of the Dennis / Marlboro / Senna / Honda dominance, McLaren had 20 years of Mercedes engines and won a single constructors championship (when Newey turned up with a winning design for 1998).
I visited the McLaren technology centre some years ago and the place is a product of someone with a vision, a lot of money and severe OCD. Shareholders will tolerate someone who is acting like a James Bond villain and winning. But it’s four years since McLaren won a race, and you have to wonder if the problem is at the top…

Mercedes owned a 50% stake (until they bought out Brawn) – which they sold to the Bahrainis – who as pure investors probably had less patience with Ron. I’ve long thought that Brawn winning a constructors championship in their first year with Mercedes was what caused Daimler to walk away from McLaren and invest at Brackley. Since then, Ron has lost his star driver (Hamilton), his star technical guy (Paddy Lowe) and his title sponsor (Vodafone), and gave up Mercedes power in favour of Honda. Re-hiring Alonso was questionable. His management isn’t looking too hot. So it’s no surprise that his shareholders ran out of patience and that he couldn’t find new investors to replace them.

If Paddy Lowe hasn’t signed a new Mercedes contract his phone will be ringing fit to bust.

36

Mercedes really did a number on McLaren. I bet you get super dirty looks at McLaren if you drive a three pointed star to work. And you never see them brake out their Mercedes WDC winning cars for PR chats or look back at McLaren glory, only the Honda ones.

37

McLaren staff used to be able to get a Merc on a very nice lease deal. I assume they now can get Hondas. And given how everyone has to go with Ron’s way of doing things I would expect people feel obliged to.
Given they are now tied in with Honda you’d expect them to major on the Honda history.

38

What is going on with Paddy Lowe? I’m kinda surprised Ferrari haven”t contacted him!

39

AIUI both Paddy Lowe and Toto Wolff signed 3 year contracts with Mercedes. Wolff’s would have been renewed earlier this year, and Lowe’s is due for renewal soon. I imagine Mercedes are keen to get him to sign.

40

I remember reading somewhere that Mercedes withdrew their support from Mclaren and purchased Brawn in the wake of the 2007 Ferrari-gate saga that cost Macca $100million.
Don’t remember if it was just humiliation of their main partner or its something to do with German law but it was a theory bandied around at the time..

41

Doesn’t ring true. They kept supplying engines to McLaren for another 6 years, and IIRC they disposed of their shareholding in McLaren over a period of time during 2010. McLaren were sanctioned by the governing body but weren’t convicted in the law courts, so I don’t think there would have been a legal obligation.
I’ve heard it suggested that Brawn bought the Honda operation at the end of 08 with a side agreement to sell it Mercedes. But it wasn’t decided what engine would go in the car until a while after that deal was done…

But did Mercedes start become receptive to an exit route after 2007 ? Yeah probably so.

42

I don’t think hiring Alonso was questionable – I think Alonso’s decision to head back to McLaren was questionable.

43

“Spurious…” A translation from the Danish meaning ‘Kevin laughing his ass off.”

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