Anarchy in F1?

A secret meeting of the team bosses, negotiations taking place in the dark reaches of un-disclosed locations and plenty of cloak and dagger to cover it up.Welcome the F1 in 2013.

So what is all this about then? Apparently several journalists have spotted Christian Horner, the Red Bull team boss, heading into the Ferrari factory recently, and rumours started to circulate immediately, that either he or Adrian Newey, the wizz behind the Red Bull car´s design success, was contemplating a move to Maranello. However, this is not the case.

A German journalist, Michael Schmidt, was also at the meeting and reported that Horner, Martin Whitmarsh, Niki Lauda and Bernie Ecclestone was having a talk with Ferrari supremo Luca Cordero di Montezemolo, regarding the 2013 Concorde Agreement, which has still not been signed by the FIA.

The only deal already signed is a financial package, which gives the teams 60% of the revenue for the season. Ferrari, McLaren, Red Bull and Mercedes receives a bigger slices than the rest of the teams. The FIA is yet to sign and the governing body is reportedly asking for $40m slice of the pie. But until then, the “processes for agreeing and enforcing rules are currently up in the air,” as one website said.

Ecclestone was heard mention, that he did not think it was necessary to sign the Concorde Agreement…

Details of the Concorde Agreement emerges

Some very interesting details about the new Concorde Agreement, has been revealed in the Guardian newspaper.

The teams have signed the new Concorde Agreement, but Mercedes´ deal is still shrouded in mystery, if there is any. The Brackley-based team has bene reluctant to sign the deal, which will hold the teams to the sport until the end of 2020. It has since emerged that Ferrari, McLaren and Red Bull have received seats at the board, and it is unclear if Ross Brawn is looking for the same deal.

According to the Guardian, the 12 teams will share a payment of £115 million, just to agree to the deal. the annual prize fund, or the money wchich the teams will divide between them, remains at 47.5%, however a series of new bonuses mean an additional 7.5% will be shared between the top three teams. Ferrari will receive 5% extra for their historical significance

Bernie Ecclestone says that the teams will get a little more than before.

“The teams are going to get around $70m more,” said Ecclestone.

There are also some interesting exit-clauses for the teams. If the underlying profit of F1 falls below $715m per year, or £456m per year, the teams can quit. For now the profits are at $1.7bn, or £1.085bn. A special exit clause for Ferrari means that they can quit of the control of the company changes and profits drop by 25% in the next two years.

Mercedes ‘close to quitting’ rumours gathering speed

Depending on where you get your F1 related news stories, you will see that Mercedes is either very close to dropping out of Formula One or is not at all considering such a thing. And everything in between.

Since F1 correspondent Kevin Eason wrote an article in the Times, claiming that Mercedes will pull out of F1 because the team did not receive board member seats, which were offered to Ferrari, Red Bull and McLaren, the many varieties of the story confuses the matter, rather than explain anything.

“Mercedes, which is estimated to have spent more than £1 billion on grand-prix racing in the past two decades, is on the verge of quitting Formula One as the company is denied a seat in the new boardroom that will control the sport when a Stock Exchange float is completed,” the Times reported on Monday.

“Red Bull, the relative newcomers to grand-prix racing, and Ferrari have both been promised boardroom places by Bernie Ecclestone, Formula One’s chief executive, as he lines up a float that could value Formula One at up to £6 billion. Mercedes, who registered their first win of the modern era in China only last month, have been isolated with McLaren, their former part-ners, also being handed a place.”

F1 will be looking forward to a flotation on the Singapore stock exchange soon, Mercedes were not invited to join the new board. The new Concorde Agreement has been signed by eight teams, leaving only Mercedes as well as the three new teams to sign up. As for the three new teams, their value are so low that they have no negotiation power, only Mercedes is still in a position to get a good deal with Bernie Ecclestone. However, he is not about to make any proposals, as he does not regard the current Mercedes team as a development from Tyrrell, but rather a new team which entered the scene in 2010. That means, in his view, the value of Mercedes is lower or as he puts it:

“Why should Mercedes have the same deal as the others?” Bernie Ecclestone is quoted as saying. “What have they done in formula one? They won a race and that is it.”

Respected journalist, Joe Saward says:

“If one looks at the ownership of the various F1 teams one could extrapolate any number of daft stories about who might be on the board of the Formula One group. As to whether Mercedes will pull out of F1, the story is similarly misleading. Yes, Mercedes may have totted up how much it would cost them to withdraw from F1, but they might also have worked out how much lawyers fees would cost to mount a challenge to the Formula One flotation and realised that lobbing a law suit would certainly get the attention of the financial people and would probably screw up any hope of the float taking place.”

So what about Mercedes then?

Mercedes is the only big team left yet to have signed the new Concorde Agreement, but what haven´t they just put their signature on the paper?

Eight teams have signed the new Concorde Agreement, which will be in effect from January 1 2013 until the end of 2020. But four teams, HRT, Marussia, Caterham and Mercedes. The first three teams doesn´t have any negotiation power as such, having been in F1 for less than three full years and are not point scorers. So the option for them is simple: Sign or be left behind, struggling even more than you already are. But the Mercedes issue is a little more complex.

There have been rumours circulating, that Mercedes is looking for the same deal offered to Ferrari, Red Bull and McLaren-Mercedes, which is board member seats at F1. But the dispute could have historical reasons.

The current agreement gives 50% of the money to the teams, Ferrari then receives an extra piece of the action due to their history as the oldest team. The new agreement, however, has a clause where additional payments will go to teams who has competed since 2000, without making name changes to their team. Mercedes has changed their name several times since the millennium. Before they were called Mercedes, the team was known for one year as Brawn GP and won a championship with Jenson Button as the champion. Before that the name was Honda, which rose from the ashes of BAR Honda, which rose from the ashes of Tyrrell. And according to Bernie Ecclestone, team principal Ross Brawn is looking to get a higher prize sum because he believes the team is rooted in Tyrrell, a team which has won three drivers championships (1969, 1971, 1973), and won constructors championship (1971).

But Ross Brawn is also claiming that the Mercedes name of 2012 is no different from the Mercedes name of 1955. Whatever the dispute is, Mercedes could risk their entire F1 future.

New Concorde deal in place, says Bernie

A ‘majority’ of the teams have agreed terms for the new Concorde Agreement, Bernie Ecclestone said on Saturday.

After widespread rumours that Ferrari and Red Bull had managed to score a lucratice deal, involving extra payments for Ferrari and Red Bull as well as a piece of the shares, it now seems that some teams have decided to pull together and decided on some new terms.

“I am very pleased to announce that we have reached commercial agreements with the majority of the current Formula 1 teams, including Ferrari, McLaren and Red Bull Racing, about the terms on which they will continue competing in Formula 1 after the current Concorde Agreement expires at the end of this year,” said Ecclestone.

For the moment, Ferrari Red Bull and McLaren seems to be onboard, but it is believed that also Toro Rosso, Sauber and perhaps Mercedes and Force India will be positive about the discussions surrounding the new deal.

Ferrari team principal Stefano Domenicali said in Australia: “I think that what I can say is that we are in discussions, and the discussions are going on in the right way. But there is no more than that at the moment.”

Red Bull team principal Christian Horner added: “We are in discussion about a future Concorde Agreement. We want to have a Concorde Agreement that reaches into the future and we are in discussion with FOM at the moment. Talks have been progressing reasonably well, so we will see.”

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http://www.telegraph.co.uk/finance/newsbysector/epic/bsy/9154564/Sky-News-ordered-to-remove-Formula-1-story.html