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Analysis: Red Bull move towards divorce from Renault and Mercedes engine deal

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Analysis: Red Bull move towards divorce from Renault and Mercedes engine deal
Aug 22, 2015, 11:00 PM

It's been a significant weekend in the development of the story around Red Bull breaking up with Renault and partnering with Mercedes.

It's been a significant weekend in the development of the story around Red Bull breaking up with Renault and partnering with Mercedes.

There have been suggestions that the Austrian-owned team has already served notice of intent to break its contract, which was due to expire at the end of 2016. Renault has apparently contested the grounds for the termination, which is based on Renault not meeting performance targets.

It is not clear how those targets are specified in the contract, but it is understood not to be based on figures but on relative performance to other power units in the field.

Red Bull has been lobbying Mercedes for months to supply it with engines, but the German manufacturer has been making negative noises up until the last few weeks, when the mood music changed. This is likely to have come from the Mercedes board.

Red Bull boss Dietrich Mateschitz has made it clear that he will pull out of F1 if his team does not have a competitive engine. So Mercedes is acting here partly out of a will to do what is in the best interest of the sport.

Toto Wolff

We reported last week Mercedes boss Toto Wolff's change of tone, when he said,

“If I wear my Mercedes Benz motorsport boss’ hat and think about what is in the best interests of F1, then I have to say it’s (a Red Bull engine supply) an interesting option because it it would link us to a brand that has huge appeal among the young and it’s a winning brand,” Wolff told Gazzetta dello Sport.

“However, speaking as the boss of a rival F1 team, I have to say that it’s not ideal to strengthen one of your main competitors which knows how to make winning racing cars.”

But some sources urge caution - no deal is yet done and this is something Red Bull would dearly love, but it doesn't mean definitively that it will happen.

One thing is clear; Dieter Zetsche, chairman of Mercedes' parent company Daimler, does not want to upset his opposite number at Renault, Carlos Ghosn. Mercedes and Renault have some significant joint initiatives behind the scenes and there is no question of their collaboration being threatened by an F1 based squabble.

So Mercedes has insisted that Red Bull and Renault be officially divorced before they will get involved in any collaboration.

Lauda, Wolff, Horner

The upsides for Mercedes of supplying Red Bull are that they could keep a close eye on one of their main rivals, they could also help a partner team to get ahead of Ferrari and blunt the Maranello threat.

Mercedes would however insist on some kind of clause whereby Red Bull would be prevented from talking down its engine supplier, as it has consistently done with Renault over the years.

If, for example, Red Bull felt (as some Mercedes customers have suggested) that some of the software and intangibles around the power unit was not to exactly the same spec as the works team, Mercedes would not want their noisy customer to create negative PR.

Bernie Ecclestone is known to want to keep Renault in F1 and is working with them to try to broker their takeover of Lotus.

Renault is weighing up the acquisition of Lotus, which is close to the financial edge with a variety of creditors circling this weekend and threatening the team's property in the Spa paddock with seizure.

With a lot of debt to parent company Genii on Lotus' books, one theory has it that Lotus owners Genii will remain as silent minority shareholders in the team, offsetting some of the debt against that.

But another school of thought is that the situation is so bad that the team could go into administration and Renault would acquire it from the administrator, which would leave creditors in a bad situation (as the Marussia administration did).

Ironically one of Lotus' biggest creditors is…. Mercedes.

Lotus's base at Enstone would need to be recapitalized but it has some good facilities including a 60% wind tunnel, up to date CFD and a good simulator, some of which were investments by Genii.
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