Peace in our time, Formula One war is over

Peace in our time, Formula One war is over

Formula One drove back on course Wednesday. A meeting in Paris of the World Motor Sport Council of sanctioning body the International Automobile Federation (FIA) resolved money and governance issues that had threatened to remake the top level of...

Formula One drove back on course Wednesday. A meeting in Paris of the World Motor Sport Council of sanctioning body the International Automobile Federation (FIA) resolved money and governance issues that had threatened to remake the top level of world motorsport.

Max Mosley, FIA President.
Photo by xpb.cc.

FIA president Max Mosley announced an accord after the conclave of 120 FIA members that was attended by representatives of Formula One Teams Association (FOTA) and the sport's commercial rights holder, Bernie Ecclestone.

The teams currently involved -- BMW Sauber, Brawn GP, Ferrari, Force India, McLaren Mercedes, Red Bull, Renault, Toro Rosso, Toyota and Williams F1 -- and three new teams -- Campos Meta, Manor Grand Prix and Team USF1 -- will contest next year's FIA Formula One World Championships. Mosley will stand down as president at the end of his term this October. Teams will follow 2009 regulations with amendments agreed before April 29, 2009.

Within two years, teams will reduce spending to levels of the early 1990s. Manufacturer teams will assist new teams with technical assistance.

Manufacturer teams agreed to a permanent and continuing role for the FIA as governing body, and they committed to commercial arrangements for the sport through 2012.

All teams will adhere to upgraded governance terms of the 1998 Concorde Agreement, a confidential pact among the FIA, Formula One Administration and teams.

A unified stance came about only after active FOTA members, eight of 10 teams in the series, late last Thursday decided to form a separate tour for 2010 and proved through the weekend at the British Grand Prix they were quite capable of doing so. The teams had submitted conditional entries for 2010, insisting their views be reflected in rules changes.

"There will be no split," Mosley told reporters. "There will be one championship in 2010, which is, I think, something we all hoped for. We've reached agreement on a number of items. In particular, we've reached agreement on reduction of costs. We've had significant help from the FOTA teams, and the objective is to get back to early 1990s levels within two years."

Sir Frank Williams, whose Williams F1 team was suspended along with Force India by FOTA for signing up for 2010 without conditions, recently told F1 Racing magazine his team won the 1992 world championship on a budget of 32.5 million pounds ($53.62 million).

Ecclestone, whose commercial guidance of the sport has made millionaires of several team principals, said, "I'm obviously very, very happy common sense has prevailed, which I always believed it would, because the alternative was not good at all. I'm also, I must say, very, very happy that the teams have come to their senses to stop spending large amounts of money."

FOTA chairman Luca Cordero di Montezemolo, president of Ferrari, applauded the accord.

"We will have the rules of 2009, same rules for everybody," he said. "It means that we have stability."

Montezemolo was notably vocal in insisting Ferrari would not participate under Mosley's rules. The Italian successfully leveraged his company's name, the most magical in motorsport, into producing Wednesday's agreement.

"I think he has done a very good fix of the problem," Montezemolo said of Mosley.

Mosley first proposed an optional 30 million pound ($45.5 million) spending limit for 2010. Teams signing on would be allowed more liberal rules applications. Teams reacted that they could not reach such a reduction in so little time -- some would have had to lay off hundreds of employees -- and that teams following different guidelines would produce a two-tiered championship. The spending figure rose to 40 million pounds ($65.9 million), but teams rejected that figure, too, as well as provisions for monitoring spending.

Three times world driving champion Sir Jackie Stewart, who sold his start-up Formula One team, Stewart Racing, to Ford, which branded it Jaguar Racing and later sold the team to Red Bull drinks magnate Dieter Mateschitz, told BBC Radio 4, "I'm very pleased that this has been sorted out because I think if had Max's regulations come in, there's a very good chance that thousands of people would have been made redundant (jobless) in Formula One. Because if you say 30 million or 40 million or whatever new number he came up with, it was going to take an enormous amount of redundancies to be able to afford the sport."

Mosley began speaking out a year ago that spending levels in Formula One, the most expensive sport contested annually, were unsustainable. Estimates in the past decade put spending by Ferrari, the only team to have participated in the sport throughout its history, at nearly $500 million annually. Teams agreed with Mosley's contention and formed FOTA in September to present the owners' side.

A rancorous public spat followed through what labor economists call integrative negotiations, discussion of multiple issues. Beyond money and reaching spending targets, teams revealed dissatisfaction with FIA governance, Mosley's leadership, Ecclestone's revenue sharing, and lack of a Concorde Agreement, by which all parties have a say in running the sport. The latest such agreement expired at the end of 2007.

Fans, sponsors and potential sponsors were subjected to lurid headlines and dire predictions as the two sides aired their grievances and used media outlets in the bargaining process.

Mosley, whose private life took a sensational public turn a year ago in a tabloid expose and cast the sport in a negative light, became the focal point of complaint for teams as he promised to step down then vowed to continue as the row wore on. He announced last year he would resign in the fall only to change his mind and seek another term.

The 2009 season is in a three-week summer break. Racing resumes July 12 in Germany.

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About this article
Series Formula 1
Drivers Jackie Stewart , Frank Williams
Teams Ferrari , Mercedes , Sauber , McLaren , Force India , Toro Rosso , Williams , Brawn GP , Jaguar Racing