Formula 1 eyeing salary cap

Max Verstappen talks with Daniel Ricciardo

Key Formula 1 stakeholders, including the teams, are entertaining the prospect of introducing a salary cap into the sport.

While financial regulations currently limit what teams can spend when it comes to fielding the cars themselves, there are a number of areas which fall outside its jurisdiction.

That includes marketing spend and the salary of selected positions within the organisation, drivers among them.

As the sport continues to find ways to make itself more sustainable, both environmentally and financially, there is a growing push towards capping salaries.

“This will be probably the next topic on the table,” conceded Alfa Romeo Sauber’s Frederic Vasseur.

“It has to come together, between drivers and key personnel for sure.”

Exactly how such a cap would be introduced is still unclear; whether it sits alongside the current cost cap or is absorbed into it.

Those details are still to be ironed out, and that is not expected to be done in the short term, though Vasseur is keen to see something introduced in future.

“We have to find something like this because it’s important for the sport, and I think at the end of the day that it makes total sense for the competition,” he said.

“I’m more than pleased to go into this direction.

“F1 is in a very good shape today, in good shape because the show is going up and also because the FIA and the FOM [Formula 1 Management] took the right decision the last couple of years, that I think that we have to continue in this direction.”

The cost cap has been a notable addition to the sport since it was introduced last year, though hasn’t been perfect.

Ferrari, Red Bull, and Mercedes have all voiced concerns that they will breach the $140 million cap this year, while McLaren has also said it would be in favour of concessions where they made sense.

Meanwhile Williams has become the first team to fall foul of the rules, submitting its documentation to the FIA late and copping a $25,000 fine for its trouble.

“I’m in favour of adding that underneath a global cap, so that the teams can trade off driver skill with updates,” said Alpine’s Otmar Szafnauer.

“Ultimately, both things bring performance on track, and I think for us to have the latitude to be able to trade that off is probably the right thing.”

McLaren’s Andreas Seidl shared that opinion, suggesting that “it’s important now to simply keep continuing the discussions behind closed doors, because there’s no point to now in public to discuss how could that all work.”

Policing the cost cap has been an area of concern, with fears those looking to circumvent the current cost cap could do so if sufficiently motivated.

Publicly, the teams are all supporting the FIA and its processes while acknowledging they’re currently immature and will take time to settle down.

They also note the complication which arises courtesy of different business structures and accounting processes.

It’s a complicated task for the FIA to manage, which looks likely to have a salary cap in some shape or form added on top of the existing rules.

“There’s enough examples around from other sports that this mechanism could do the job,” Seidl said.

Szafnauer added: “Other sports have implemented this, and we should take some learnings from them and take our time to make sure that it can be policed, and we do stick to the cap when it does come in.

“But like we said, that should be a next step, and we shouldn’t rush into it, but make sure that we have good methods in place to be able to police it and also have it be a fair cap.”

A further complication to the plan is the number of long-term contracts currently in place up and down the grid.

Max Verstappen for instance has signed on with Red Bull until 2028, while at Ferrari both Charles Leclerc and Carlos Sainz have deals until the end of 2024.

McLaren has Lando Norris tied up until 2025, and it’s unknown exactly what is mean by a ‘long-term deal’ for George Russell at Mercedes.

Those of course are not insurmountable problems and there would almost certainly be some grace period out of necessity.

The full details of a cap are of course far from finalised, and any introduction is not expected before 2026.

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