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March 18, 2009

F1 Budget Capping

There are going to be some very surprising results on the track if these rules actually come into effect (read more here).

Movable aerodynamic devices, budget capping, forensic accounting (by Deloitte and Touche), two rule paths, and KERS do not lower costs. At first glance it seems more to do with money and power than the racing itself. The FIA wants to increase the pool of possible teams in order to weaken the position of the manufacturers so that it can rule the sport more effectively and minimize the sport's exposure to the whims of those manufacturers who come and go.

This is not a bad thing. The bad part is that what they're proposing to do is not likely to work. Most of the rule changes intended to cut costs in the past few years have resulted in the oppposite. Engines that have to last multiple races, restrictions on wind tunnel and track testing (can you say spending on simulation???), and so on. Don't forget the safety ramifications too.

The most effective cost reduction rule of the past 5 years has been the recession we're in. That's a real budget cap. Next was when Michelin dropped out of the tire war, leaving Bridgestone as the sole supplier.

What the FIA has put forth for 2010 seems likely that it will either not work or descend into more race results being determined in the kangaroo court that is the FIA World Council. That is not Formula 1 and that is not racing.

It may be the best compromise they can come up with at this time. But I assure you there is a far better way to reduce costs and improve the quality of the racing. And it has never been utilized. I might even file a patent on in.

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