F1: Cost Cap requires a different mindset

–by Mark Cipolloni–

Stefano Domenicali says the cost cap has forced F1 teams to adopt “different cultural minds” about how they go racing.

Introduced in 2021, the budget cap limits the amount of money each team can spend in a calendar year on their racing program, with a $135 million limit in place for 2023 plus adjustments for inflation.

Its goal is to bring the teams closer together in performance because it limits how much money the bigger teams can spend.

Speaking at a recent Liberty Media investor call, F1 CEO Domenicali highlighted the shift in mindset the cap has brought about.

“First of all, I think what has been done has been phenomenal for the sport, and it [should not be taken] for granted that it has been a success,” Domenicali explained.

“We added the financial [rules], made it the most complicated one in terms of policing because the physicality is different from country to country, the complexity of the details of teams that are part of a manufacturer – and then there are other entities that are building up to create some resources for the team.

“So the complexity is for sure something the FIA has to be very strong [about], and building up a team that is really very good at managing the control.

“But I think what has been done is one of the pillars enabling the system to be so strong is that it puts the teams in a different cultural frame because now they need to think differently, how to manage the development of the year.

“We’re talking about Sprint [races], that could be another factor. You can have more accidents or crashes and so. It is part of the game.

“So they need to control in a different way that’s better for the unpredictability of the sport.”

“It’s something that has been very difficult to put into the heads of the old people who have been in Formula 1 since the beginning,” he added.

“But I think it is crucial in the intermediate term to have it because that will enable us to have more [closer] competition on the track.”

Sprint Races bring an element of risk to a team’s budget

In 2021, and again in 2022, the F1 calendar featured three Sprint Race weekends, but for the F1 2023 season, we will see an increase to six sprints – double the chance for a big wreck that can severely impact a team’s development budget.

There is talk of increasing the number of sprints to a stage where half of the calendar uses the format – 12 extra Sprint races a year, 12 more times a wreck will destroy a team’s budget.

Of course, teams will then lobby for an increase in the Cost Cap because of it.

“I don’t know if we will do it every race weekend. Maybe do a few more or maybe do half of the calendar,” Haas Team boss Guenther Steiner told Reuters in an interview via Haas’ title sponsor MoneyGram, “but the F1 promoter will know what to do.

Guenther Steiner, Team Principal, Haas F1 Team speaks to the media during the Australian GP at Melbourne Grand Prix Circuit on Thursday March 30, 2023 in Melbourne, Australia. (Photo by Simon Galloway / LAT Images)

“At the moment there is more demand for races [than slots available] so how can you get more races in, more competition, more racing if we cannot do more than 24 events? So just make the event double count.”

Steiner said there would still be a need for some race weekends with three practice sessions and just a Sunday grand prix, but the current Saturday sprint format needed changing.

“The FP3 (third practice) session on Saturday morning became almost worthless because nobody was watching it, the teams couldn’t do any changes on the car except trying the tire out for the race, so there was no real interest,” he said.

“So I think that is a good addition to the weekend to put a sprint qualifying in.

“You have to see how it works with the fans, if they like it, how the numbers come back and then decide what to do as the next step. But at the moment I support very much the sprint qualifying.”