There’s no race this weekend but we do have some Formula 1 action going on over the last couple of days. Most importantly, F1 announced that all 10 of the current teams have signed the new Concorde Agreement which keeps them in the sport till 2025.
A quick explanation as to what the Concorde Agreement is: a contract between F1, governing body FIA and the teams that want to compete in the F1 World Championship. Its name comes from the original document that was drawn up in 1981 at FIA offices on the Place de la Concorde in Paris. One of the most significant elements of this agreement is the part that defines how F1’s broadcasting revenues and prize money will be distributed. The current Concorde Agreement was due to expire at the end of 2020, hence why it is so significant that the new one has been signed despite the circumstances.
Under the new Concorde Agreement, the prize money is distributed in a more sensible way wherein the big teams don’t get as much and the little guy (smaller teams) get more. Ferrari is the only team which will continue to get special treatment in terms of a bonus for staying in F1 because let’s face it, the two identities are deeply intertwined in their co-existence. Aside from that, there is a new cash pot wherein heritage teams (Ferrari, Mercedes, Renault, McLaren and Williams) and recent podium winners are eligible for a percentage of F1’s revenue above a certain amount. Last of the broad money distributions is the prize money pool, which is what’s left of the profits after the aforementioned rewards. This is the reward for the team’s final result in the constructor’s championship. Here too, the sliding scale has been tweaked to give a bit more to those who could use more. According to a report by The Race, these figures stand as follows:
The new agreement also includes the new rules and regulations for the sport such as the budget caps which will be introduced from 2021 and the new technical regulations from 2022. In summary, the new agreement aims to reduce the on-track and off-track disparities between the teams to get closer racing action as well as improve the business model to ensure the longevity of the sport. This is the first Concorde Agreement under F1’s current’ American ownership headed by CEO Chase Carey. Most F1 teams are happy with the new rules, especially the independents, despite everyone’s compromises in the negotiations. If it works as it is intended to, it should be great for us fans as well to see more exciting races in F1 again.
Soon after the 2021 Concorde Agreement was signed, the next big news in F1 and maybe across all motorsport was the sale of the Williams F1 team. A family-owned team under Sir Frank Williams for decades, Williams Grand Prix Engineering announced it was up for sale or at least looking for new investors in May 2020. This came soon after title sponsor RoKiT backed out before the delayed 2020 season got underway. The team has now been bought outright by Dorilton Captial, a US-based investment firm for a reported value of €152million. It’s a bit sad to lose that special lineage of ownership at the top level of motorsport, but the new owners don’t want to change the brand itself. The team will continue to race under the Williams name and will continue to operate at their facilities in Oxfordshire, UK. For now, the team will continue to be led by Claire Williams but its too soon to know how the leadership structure, if at all, will be affected. What we do understand is that it gives the team some financial reassurance and vital funding to start working towards a competitive mid-field car instead of just being seat-fillers at the back of the grid.
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