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Insight: Why the F1"bounce" and which way is the wind blowing on new F1 rules and budget caps?

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Insight: Why the F1"bounce" and which way is the wind blowing on new F1 rules and budget caps?
Sep 2, 2017, 10:39 AM

Monza is a busy paddock every year and this year is no exception, especially with the fresh energy that the new owners Liberty Media have injected ...

Monza is a busy paddock every year and this year is no exception, especially with the fresh energy that the new owners Liberty Media have injected into the system.

In recent years the event outside the F1 paddock had developed a slightly stagnant feel, not helped by constant threats to the future of the event being hosted here.

This year the crowds are larger and the rise in enthusiasm is palpable; whether it's the plethora of banners in the stands or the hundreds - rather than dozens last year - who line the entry to the F1 paddock. Everyone in F1 has to walk past them to get to the paddock every morning, much as at Melbourne with the famous Melbourne walk.

There is a bounce in F1 that insiders can all feel, helped by a proper competition at the front between two of the great names of motorsport, Ferrari and Mercedes and between Hamilton and Vettel. But it's not just because Ferrari are doing well that we see this enthusiasm. The bounce was evident at Montreal, Silverstone, Spa.

Perhaps the message is slowly getting out that F1 is fun and human again, via episodes like the Raikkonen fan kid who cried at Barcelona or Mick Schumacher swallowing with emotion after driving his father's Benetton F1 car at Spa.

But there is still a massive amount to be done and the staff at F1 management's new offices has swelled with new hires in marketing, digital, sponsorship and other departments. They are all focussed on monetization, but one to keep an eye on is Ross Brawn's department which is developing capability to change the rules of F1 to close up the field, make the cars able to run together and overtake and to bring down the costs.

This process is gathering pace and sources suggest that everything is on the table and being discussed in an open forum between teams, FIA and Brawn's team. The idea is to find areas of consensus and build around those. But where things will probably deviate from the dysfunctionality of the past is when it comes to actually deciding what the specific rules will be and setting that out.

If there is not consensus with all the teams, then rather than accept failure as so often in the past, the F1/FIA axis will probably over-rule the teams and impose the rules, take it or leave it.

If you think about it, this is the only way the sport can move forward as we have to get past the vested interests that have held up progress in the past.

So at the moment some ideas in circulation, as we mentioned in Spa coverage last week, are a $150m a year budget cap with a glide path down to there (from $250m+) for the top teams to get to that point in three years. The figure doesn't include drivers salaries, marketing and some other items. Engines are another thorny point as they currently cost too much money and are too great a performance differentiator. They also give the manufacturer backed teams a stranglehold on the sport.

If you look at the F1 field, taking the top three teams out of it, each Grand Prix is a thrilling and close battle; if it was for the win rather than 5th place and back, it would have everyone on the edge of their seats. So it's a question of how you incorporate the top teams into that in a rules formula that doesn't artificially punish or handicap great names like Ferrari and Mercedes that are part of the box office draw of the series.

"It (budget cap) needs to be done in a way that it is good for the sport, that it respects the structures that have been created, so it needs a glide path, and it needs to be fair," said Mercedes boss Toto Wolff.

"We have all different set-ups.. we are organised in different ways. Ferrari is a fully integrated team within the larger road car company. We (Mercedes) are a separate entity in the UK. You look at all the teams; it’s very different. You need a governance that functions and you need a strict set of rules and then it just needs to cover everybody. The discussions that have been happening, at a very early stage, I think there is no big disagreement."

Ferrari's Maurizio Arrivabene made the point that if F1 is experiencing a bounce at the moment it is because of the level or competition between his team and Ferrari, that its proving a turn-on for fans,

"We need to take into consideration that this year, thanks to the battle between Mercedes and us, you can see, all the tracks they are full of people and I mean, maybe Liberty have to think about that," he said.

"There are going to be some tough negotiations, "Brawn told BBC this weekend, "But we have to be sensible and adult and find solutions for the long term future."

For the independent teams Ross Brawn's cost cap cannot come soon enough. "Of course we would be absolutely behind the cost cap whatever that may be, " said Claire Williams. "But from my perspective equally, I would want to see it come in a lot sooner than that (2021)."

Bob Fernley of Force India agreed: "We would want it to come in as soon as possible," he said. "The 150m is above our budget but I’d much rather be able to say that Force India was capable of bridging the deficit of 30m than 200m which is where it is at the moment, and I think it’s very important for the sport to have five or six teams that are capable of achieving a podium on merit. At the moment, that’s not possible.

Even the fourth, fifth and sixth teams are only capable of getting it on opportunity at this point and we need to be able to change that round to make the sport the spectacle that it is and to give the competition there."

Ferrari is enjoying its own bounce; it has been an ever present in F1 but hasn't always been in contention at the front, as it is today. Mercedes has only been a works F1 team for two short spells in the 1950s and 2010s and has generally found a way to be dominant when it's been here.

Ironically Williams and McLaren are two of the great ever present names from the last fifty years, but both find themselves outside the top three today and on the wrong side of the performance gulf.

Both teams would like an effective cost cap to be introduced as soon as possible. This proves beyond doubt that F1 is cyclical and the top teams of any given moment always think they will be forever on top, not in the position McLaren and Williams find themselves in today.

This generation of team principals need to understand this and to take a more rounded approach to this important decision.

Policing the budget cap - a question of trust

It will come down to trust, as it always does and there are more sophisticated ways of measuring budgets on the input and output side than in the Max Mosley era at the FIA when he tried hard to bring in budget caps. A pair of forensic accountants working for F1 or the FIA could be installed in each team at a cost of around £300,000 per year per team and, wit modern accounting and procurement tools, would be able to account for everything and be seen to police the budget cap.

The sport has a unique character in this respect; Brawn knows how things work at Ferrari, Mercedes and Honda, having led all three teams technically and also as head of Brawn GP knows the life of an independent. Were he to install such a process and define its scope it should have a fair chance of success.

No timetable is fixed, it seems, but one senses that it won't be too long before the first official messages about new rules, budget caps and new engine regulations will start to emerge.

The bounce is nice. But staying up in the air, with sustainable teams and close competition, would be nicer.

What do you think? Would you back an F1 cost cap if it could be effectively policed. Do you think that Brawn and his team will succeed? Leave your comments below
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