Red Bull team principal Christian Horner has warned that multiple Formula 1 teams could fail to complete the season if the FIA doesn’t raise its annual budget cap.
All ten F1 teams are bound by an annual cost cap which limits total spending on the running of the team to $140m this year, including the price of car upgrades, salaries for personnel, and transportation.
Shipping and freight costs have grown exponentially since the turn of the year, with the cost-of-living crisis and Russian invasion of Ukraine both contributing factors. F1 underwent its biggest regulation change in a generation over the course of the winter with every team being forced to design their cars from scratch as the sport aims to encourage closer, more exciting racing.
The knock-on effect of the new technical era is that teams will constantly be updating their machinery over the course of the season, in a bid to correct errors made during the design process and maximise their speed, which comes at a significant financial cost.
Red Bull currently lead both the drivers’ and constructors’ championships, but Horner believes that with inflation rising to seven percent, the FIA should increase the cost cap in order to ensure the season doesn’t collapse.
‘We need the FIA to address the inflationary issue because basically probably about seven of the teams will need to miss the last four races to come within the cap this year from the consensus there has been up and down the paddock,’ Horner told media after Max Verstappen won the Spanish Grand Prix.
‘It’s not just about the big teams now. It’s the teams in the middle of the field that are really struggling with the inflationary rate that we’re seeing could even get worse in the second half of the year. The FIA have a duty of care in a situation like this.
‘I know they are taking it very seriously because as I say, you would almost be at the point where certain teams, from the numbers that were presented earlier in the week, would probably have to miss a few grands prix to get anywhere near the numbers.’
Horner says he believes the FIA and F1 must work together to make sure that teams do not have to stop their operations before the end of the season, though teams including Ferrari have said they believe the current level of the cap should be maintained.
‘For the second six months of the year, the FIA need to address the issue. Things like energy bills, just the cost of living, the costs are going up exponentially and Formula 1 is not exempt from that.
‘We see that freight has quadrupled and that is not something we can control. In many respects, it’s an arranged marriage between the two. You rely on the regulator and the commercial rights holder to work closely, and I think there is a desire for the two of them to do that.
‘Obviously, the new president [Mohammed Ben Sulayem] is determined to make his own mark and he has got some good ideas and some visions that he has for the FIA. With Stefano [F1 CEO Domenicali] and the Liberty Media guys, it needs to go hand in hand with their desire to grow the business and develop the business.’
The seventh round of the 2022 F1 season will take place in Monaco on the weekend of 27-29 May.
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