F1 legal chaos with General Motors

Formula One is currently the place global corporate money wants to play and a recent valuation by Sportico claims the combined value of the current ten teams on the grid is a record $15.3bn. 

The FIA is currently considering applications from several new teams to join the sport with the Andretti/GM and Hitech proposals believed to be under serious consideration.

Whilst FIA president Mohammed Ben Sulayem has been vocal in his support for addition new teams, the current crop with maybe the exception of McLaren have aggressively argued this will diminish the huge investments they have made in recent years.

This places F1’s commercial rights holder Liberty Media in a bind because whilst it should not cost them a share of their income should new teams be admitted, by upsetting the current teams they risk harming their good relations and a potential return to the days of perpetual unrest as was the state under the previous F1 supremo Bernie Ecclestone.

F1’s CEO, Stefano Domenicali this year pulled off a feat that would have been impossible in the Ecclestone era, where mid-season regulation change was unanimously agreed by the teams to change the format of the Sprint weekends.

Under Ecclestone the constant shifting political demands would have seen this vetoed as one or more teams would have used proposal as an opportunity to exact a demand of their own in return and inevitably the unanimous agreement required for mid-season rule changes would have failed to materialise.

The teams are upset at the remuneration they would receive from any new entrant suggesting it would not compensate for the lost share of the prize pot money they would receive.

However, it was the current crop of ten who agreed in the Concorde agreement signed just two years ago that the anti dilution payment for any new competitor be set at $200m. Now they argue it should be three times this amount based on the precedent set in the NHL who accepted a new franchise team this year for around $600m.

So the teams are clearly not in principle against new competitors but as always in F1 its clearly about the money.

Andretti/Cadillac claim they will be ready to join the grid for the 2025 competition and of course this would be at the lower entrance fee.

Return of French GP

The next Concorde agreement is due to be enacted in 2026 and clearly Liberty Media’s CEO believes if the teams were to agree an early signing of this contract, a revised anti-dilution payment could be included and enforced before 2026.

“We have several years left to run on the Concorde Agreement,” said Maffei in a call with Wall Street analysts.

“But I think there’s a consensus among the teams and the FIA and ourselves that now might be a good time to try and strike while the iron is hot and renew and extend the Concorde Agreement.”

As yet there is no sign of this consensus most recently epitomised in the row between Christian Horner and Toto Wolff who have differing views on how the final power unit regulations for 2026 should be shaped.

As the governing body of the sport, the FIA has an objective process for evaluating any new entrants and had originally suggested they would announce their findings on 30 June.

This deadline has slipped due to the additional information the FIA request from the applicants and as yet no new deadline for the FIA’s decision has been announced.

However, prior to the British Grand Prix, surprisingly Ben Sulayem revealed his hand making it clear he is in favour of the Andretti/General Motors application. 

“Secret deal” for Ricciardo

“People have to understand we are here to promote motorsport and we are here to be fair,” the FIA president told AP.

“The Expressions of Interest process is very robust and there is no circumstance where we can deny any teams if they fulfil the criteria to enter.”

“So imagine me saying no to someone like GM? We have in the regulations that we can go up to 12 teams. I’m not breaking [the rules].”

Red Bull moves for Lando

Of course there could be legal ramifications for the FIA were they to refuse an application that substantively meets their criteria.

“But do we allow anyone to enter? No. But how on earth can we refuse GM?

“I mean, where’s the common sense in this? GM is a heavyweight and when they come with Andretti, that’s good for all of us.”

The teams based their opposition to the the initial Andretti application by getting behind a commonly cited mantra that any new entrant must ‘add value to the sport as a whole.’

Mercedes internal row over car future

Whilst the fans are keen to see the iconic Andretti name return to Formula One it was not enough to fulfil the criteria demanded.

Andretti then returned announcing their partnership with General Motors and now it is far more difficult to argue such an automotive giant will not add to the cumulative wealth in the paddock if only by bringing along its current crop of associated corporate sponsors and their money.

Whilst in strict terms it is the FIA’s role to decide whether to allow new F1 entrants in practical terms they need the agreement of F1 to make it work.

However, Ben Sulayem has paved the way to claim he is not prepared for a legal fight with General Motors should the FIA refuse their entry.

Behind the scenes furious talks are taking place on how to deal with this latest curve ball from Ben Sulayem, with F1 realising were the FIA to approve the GM/Andretti entry, they are next in line for any legal ramifications the giant American auto manufacturer may decide to bring.

All this is not a good look for F1 as Liberty Media attempts to build on its positive media image at present.

Further the fan debates in the comments following every article written on this topic across a host of F1 websites, are almost unanimous in their opinion F1 should allow the current grid to expand.

Horner “sneaky ploy”

PattRicciardo writes, “It makes no sense to me that 20% of the F1 licences are held by teams that, for one reason or other, aren’t serious about racing. Alpha Tauri is a B team tooling around at the back and Haas’s owner is openly uninterested and underinvested (Williams at least has some ambition).”

Gilles2Charles adds, “Haas are a waste of time. Never do anything. Never going to. I’m glad they gave Nico a route back because he’s 100000x more deserving of an F1 seat than some of the dross we’ve seen over the past few years. And Steiner is amusing but they’re happy being in the club, they’re never going to disrupt it.”

Sudbury Ferret amusingly concludes, “Despite what they say, F1 (the sport) does look protectionist. Why not allow extra teams to enter and see if they sink or swim? A manufacturer like GM won’t stick around if they’re consistently back of the grid for years, like all the others we’ve seen (excepting Honda who seems to quit when they’re ahead!).”

READ MORE: Radical new rule for Hungarian GP

This motor sports news item came from: https://thejudge13.com/2023/07/16/f1-legal-chaos-with-general-motors/

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