The Honda Withdrawal Crisis 05/12/2008 Formula One fans may have their favorites but they all hate to see any team disappear from the grid. The sport is about competition, after all, and, if the number of competitors drops, the races become that much less watchable. Honda may have become somewhat of a laughing stock over the last couple of seasons but we are still shocked and saddened by its sudden departure from the scene.Are they leaving?The hope has to be that a buyer will be found and the team can continue under another name. F1 teams are not corporate ventures, regardless of where the money comes from; they are associations of highly-skilled professionals of like mind and one aim - to win races. A sale becomes little more than a change of logo and color scheme when the team is so close-knit and interdependent. Minardi may have become Toro Rosso and Jordan been through several name changes to end up as Force India, but the personnel remain much as they were apart from a few new bosses.In better times, Honda would be a bargain for any prospective buyer. It has excellent facilities and an experienced workforce that was expected to produce a more competitive car next year, now that Ross Brawn has had time to see what was going wrong and make the necessary changes. Honda are clearly treating the end of their involvement as an urgent matter and seem quite uninterested in what price the team might fetch. It is likely that it will be sold for considerably less than it is worth, therefore, and would be an ideal springboard for some company or enthusiastic magnate to break into the sport.The problem is that it is not just a matter of purchase price; the running costs of F1 teams are high, too steep for many optimistic buyers in the past who have burned their fingers with a hasty entry into the sport. Funding from several sponsors is needed to help with running expenses and that is just what Honda do not have. And the economic slump that caused Honda's departure is the very factor that ensures that sponsorship is almost impossible to find at the moment. This will be the biggest obstacle to any sale of the team.If no buyer is found, Honda will disband the team and the grid will be down to 18 cars in 2009. Some are saying that the FIA could ask certain teams to make up the numbers by entering a third car but why would they do this? Even supposing that third cars would be eligible for points (something that other teams would fight), the expense of running the extra car and driver comes at a time when all the teams are trying to lower costs, not increase them. I doubt that the FIA would find any takers.There is no guarantee that other teams will not follow Honda's lead as well. Toyota is rumored to be considering withdrawal, now that their Japanese competitors have departed, and I have earlier made the case for the possible demise of STR before next season begins. Renault, too, are as unpredictable in their commitment to the sport as ever. If even one of these decides it is time to pack up, F1 is in serious trouble.All this has given Max Mosely the chance to say he told us so, as he waves his agreement with Cosworth to build a standard engine and drivetrain. It is meaningless, of course, since no manufacturer is going to agree to use the engine and the idea just makes it more likely that they will leave the sport. That is the point at which we will all ask who made F1 so dependent on the manufacturers in the first place.Now that FOTA are echoing Mosley's call for drastic cuts in expenditure in the sport, it is as well to remember that it was the entry of so many manufacturer teams that forced costs up to their present levels. Since they have the money, they will spend it in their efforts to win, at the same time making it impossible for smaller teams to compete. We are now seeing the outcome of this accelerated pace of development within a set of regulations so restrictive that any gains in performance are tiny in comparison to the effort and money spent on them. Costs reach a point where no one can afford to pay and then things start to fall apart.Bernie Ecclestone says that F1 will survive and, for once, I agree with him. The entry list for the coming season may be a bit shorter than expected, but the races will take place and, in the meantime, the teams will be finding ways to keep going on much less cash than they enjoyed before.It is the market place that will sort things out for the sport, not Mosley's depressing ideas, however. The standard engine is not due to be on offer until 2010 and, by that time, F1 will have found a way through the crisis and have adjusted its spending according to what is available. There has always been a vast difference between the amounts spent by the various teams; the difference will be that everyone will be spending much less than they were before.We should still hope that a buyer be found for the Honda team. Apart from anything else, I was looking forward to seeing how much of a difference Ross Brawn would make to the performance of the car next year. It would be a great pity if all the team's preparations for the 2009 season were to go to waste.
Clive
marc I am sick. I cannot believe the developments of the last 24hrs: the sudden departure of Honda, and Mr. Mosley's opportunistic implementation and 'justification' for the contracting of spec. engines and transmissions. Maybe you are right; it is most likely that the market will work this out. However, I want F1 as it stands to fail. Not because I dislike it, but because I like the way that it was. My hope is that in failing the teams will band together and force the FIA to come to terms with what the teams view F1 to be. Mosely must go, and Ecclestone must be treated as roughly as he has treated those who host the races.In this utopian vision F1 will drop so many of its overly specific technical regulations, open its technology development, and get back to racing. Not just on track racing, but in engineering as well. My ideal F1 would be much more open. Obviously this is a myopic view of things, but I long for unlimited engineering development. LeMans offers some technical innovation but not enough to see what is really going on. In F1 when a team came out with a new system that was really working the other teams would try to chase it down. You don't get to see that at LeMans or even in LMS. Renault's mass damper is a great example of the F1 technical show, and it was quashed by... well you can point the finger where you think is appropriate.The last series that was a real technical race worth watching was the group B development of rally in the '80s. A technical race that came to an end because of the lack of fan safety. The safety of the drivers could have been better as well, but that alone probably wouldn't have caused the series natural development to be dropped.Mostly I am left wondering what vision the teams have for F1. Date Added: 05/12/2008
Haplo I really don't get it.Is it really not possible to take Mosley out of the way? Can't the teams mutinee or something?Is that impossible? Date Added: 05/12/2008
Dave Spurr I've just been thinking about Honda's situation and then it occurred to me that if they do get someone to buy them then this could be the writing on the wall for Barrichello. Put it this way, one thing then Honda package is seriously lacking (maybe the only thing) is some sponsorship deals -- who do you think will be easier to sell to potential sponsers looking for return on their investment Barrichello at the end of his career or the magic that the Senna name alone would bring to the party (nevermind the potential of Bruno)? Date Added: 05/12/2008
Filipe I must confess that hearing and reading "Max is right" the whole day was even more depressive than losing another team. I also can't avoid the feelling that if Toyota had been the one, people wouldn't react this badly as everyone actually expects Toyota to do that (I guess it also helpd that they are the least liked team on the grid). Dave, it all depends about who is the actual buyer, if it's someone like Stoddart or Richards then Barrichello would likely be done, but if Fry finds some arab millionaire willing to throw 100m a year in a f1 team (which is probably what he hopes), there's a good shot Barrichello would be kept. Date Added: 06/12/2008
Clive Marc: Judging by the ideas coming from FOTA so far, the teams do not have a unified and realistic view of the future for F1. I suppose after years of having to go along with whatever Max has said has left them unused to being heard. They seem very confident that their latest proposals for cost-cutting will be very effective and I hope that the shock of Honda's departure makes them work a bit harder in suggesting improvements to the FIA. Date Added: 06/12/2008
Clive Haplo: I think the teams will do almost anything to avoid a revolution. No doubt that CART fiasco in the States has made them aware of the dangers of setting up an alternative series and, if it is to succeed, there must be complete unity amongst them.Having said which, if Mosley pushes too hard, it just might happen... Date Added: 06/12/2008
Clive Dave: Agreed, I can't see a buyer wanting to retain Barrichello when Bruno Senna is on offer. But I think his chances of staying on for next year were pretty slim anyway. Date Added: 06/12/2008
Clive Filipe: Max was only right in what everyone knew anyway - that F1 has become too expensive for its own good. His proposed solutions are awful, however. Date Added: 06/12/2008
Nick Goodspeed Mosley's full of poop (as usual)! I'm inclined to believe Honda left because the return on the expenditure wasn't equitable. They've got plenty of money and aren't in the dire straights the US industry is in. When you count in all the garbage going on to sully F1's reputation, the draconian single engine proposal, the moronic medal idea, Mosley's sex circus, questionable marshaling, the impossibility of having consensus among the teams due to Ferrari's penchant for trying to screw the other teams to get an advantage, it's a wonder more of the works teams haven't set screw it!! Actually, F1 worked very well for many years with 90% Cosworth engines and 10% Ferrari. Date Added: 06/12/2008
Alianora La Canta I think the "Max was right" statements said something about how rarely Max is right. If Max was normally right, it wouldn't warrant a spot on the national news...The whole "I told you so" tone is pretty hilarious since he failed to follow through on ensuring the manufacturers delivered the €10m engine supply to customer teams back at the start of 2004. If he'd simply fined them for acts prejudicial to the sport or something (as he was entitled to do since the manufacturers promised to make that supply and never came through), F1 would be in a much stronger position now.The one thing which the powers-that-be could do to help F1 would be to initiate a fighting fund. Get all the teams to contribute £3m a year, have CVC and the FIA throw in £10m each as a one-off payment and split any interest over and above inflation between CVC and the FIA. Maybe do something to encourage teams to invest more when they're feeling rich (like offer some publicity so that people know how good that team has been). Any team hitting financial trouble and needing a boost could claim against the total amount invested. Multiple claims would lead to the amount in the pot being shared between them equally (assuming that the total requested is more than has already been invested up to that point). This would ensure teams like Williams can stay in, wouldn't lead to such a big pot that profligate feel tempted to use it as a sponsor substitute and would ensure that all teams remained committed to F1 (it's easier to feel that commitment if you're paying into a community fund and getting the community effect implied by it).The trouble is that would require Max to admit Paul Stoddart occasionally got things right. Date Added: 06/12/2008
BMWF1Guy I'm going to step out of line I think based on what is being said. Although I disagree with the majority of solutions Max has tabled and tried to force on teams, I do say that he did warn F1 over and over.Forget about his ideas and just take the fact that he has said for a long time that costs have to be cut or F1 will be in trouble.I don't think we'll ever know the full reason for Honda pulling out, but I get the feeling that the loss of the North American market was a consideration. After all they rely on this market very heavily. Date Added: 06/12/2008
Gusto Oh Dear, the writings on the wall. I think Honda will be the first of many, but F1 as got no-one to blame but itself, you can only live within your means and F1`s eyes have been bigger than its belly for many years, and what did it get us?, some of the most boring races ever seen. What it needs to do is impliment massive budget cuts, engines that last a season, fuel and tyres for a complete race, massive reduction in aero packages, re-introduce clutch and gearstick, steering wheel that is just a steering wheel. If F1 can stomach it and not let ego and pride take over it might just survive, but as Max and Bernie are in there twilight years they might just be confirming that saying "You destroy the things you love". But as Max has a such a bizarre take on what love is at least the end should be interesting. Date Added: 06/12/2008
Nick Goodspeed I don't think it is possible to dictate budget cuts in F1. It will be a process of natural economic regression. As any money sport, F1 is cut throat. If there is money teams will find a way to use that money to their advantage.Mosley and Ecclestone are so full of themselves they think they can play god with world economics. If I'm racing an old Mini and get a raise, I'll most likely put some of the windfall on making my Mini go faster. If I get hours cut because there's less work I'll spend less on it. It is a natural process, a corollary of supply and demand. Even if the teams don't fold, races will since people in general will be more conservative with their cash under this sort of economic climate. The ones who should be worried aout budgeting are the Ecclestones of the world, who skim the cream off the top and play with massive debts. Date Added: 06/12/2008
David Neglecting personalities and how these bodies came to be, it’s fair to say that the FIA and the CVC are the root cause of the operational and financial problems that currently plague F1. The FIA is far to flawed to ever be fixed. Surely, we can go on patching it up (in much the same way misguided individuals will hang onto a ‘lemon’ car because, “they’ve put too much into it to let it go”), but at the end of the day a merciful death and considered rebirth is the only logical step forward. The CVC are a parasitic financial concern who made a poor investment, largely based on fantasy and charismatic personalities rather than economic sense, and thus deserve to fail as many others have now reality has taken center stage. How can we not welcome the day that F1 finally sheds this particular albatross from around its neck.It’s late in the day to try and preserve what F1 formally represented, so we may well have to settle for what F1 will represent henceforth. Sad, but true, since incompetence and greed both eventually carry a price - and that price is oft times borne by others. The one thing we can be very sure of is the teams and venues, that realistically were/are F1, will fall by the wayside long before the cause of their demise is threatened.A pessimist? Perhaps so, although I much prefer to see myself as a realist - albeit teetering on the brink of senility. Date Added: 06/12/2008
chunter This is such a tough issue to crack, because Honda's exit is an obvious good decision from the point of view of a person trying to keep a business profitable.Not to repeat too much here, but Max's solution implies that all of the manufacturers will exit the sport early in the 201x decade, and if that is the case, F1 will simply be what ChampCar was. ChampCar also had a rule that allowed new engines to be manufactured under the condition that they are made to spec, and now that ChampCar has disappeared into history, we see that there were no takers. I expect the same if F1 take that route.Motorsport will marginalize itself, as it appears the days of wondering if a Le Mans styled sportscar can defeat a Formula 1 machine or if an Indy machine can be made to be competitive at Monza, and so on, that's all long gone... All forms of motor racing want to become expensive forms of go-karting. Date Added: 07/12/2008
Alianora La Canta If the manufacturers leave in the first half of the 201x decade, then presumably F1 needs to be reconfigured with pure racers in mind. Since the loss of the manufacturers will cut costs to what the richest privateer can afford automatically, it would make the most sense to make the F1 rules sport-friendly. Which means opening them out a lot (and not restricting that opening to what is "road-relevant", so that sporting advantage can be gained in many different ways, thus increasing competitiveness between teams.The other thought - if all the top series are becoming an expensive version of go-karting, does that make those of us who are going to do some karting the sensible ones? Or can there be no "sensible ones" in such a confused system? Date Added: 08/12/2008
Nick Goodspeed I wonder if homologation is the answer. Allowing motors only if a certain number are built to spec then letting the racing teams tweak them? Date Added: 08/12/2008
chunter Are those who go karting the sensible ones? A greater part of me says that the answer to that is yes.Without going into too much detail, I used to aspire to be a pop musician, and soon found out that if stars and insane amounts of money do not align correctly, you don't make it in this field, and can become poor and forgotten very quickly. I'm sure the same can be said about the higher echelons of motor racing.I reached a point where I just didn't want the risks and incredible expense anymore, and I noticed as time passes, less and less people are interested in the highest of the highest and more are interested in the easily accessible. I stopped making music in the late 90's, and restarted when I found a circle of some semi-pro and amateur musicians that are happy to hear and make music for the fun of making it. If I made about three times what I do at my job, I'd probably try karting myself, too, but I can make music much more cost effectively than I could ever try to race a car. (eg: I use this laptop I'm typing on right now.)Though, maybe there are no sensible ones after all: think about the other obvious spec formats, especially when you consider that a lot of the same drivers are competing in them all. Was ChampCar better than IRL? Is Superleague Formula better than A1GP? If you're ready to roll your eyes, if you honestly don't give a damn about any of those series fortunes, then how can you like a homologated Formula 1? What can Formula 1 do to remain the pinnacle over all those, and not just another form of the same thing? Date Added: 10/12/2008
Lonny Ali: There is no such thing as a sensible racer. If we really had good sense we would invest any money we spend on racing in a good retirement fund. And Nick is quite right, it is impossible to control the money in F1. If you have it you spend it. I race Radio Control cars and I'm always pushing my budget to get the latest trick piece for my car. The economy will control the budgets, nothing else. And Clive is right about alternative series, CART was really doomed from the moment Penske went turncoat and joined the IRL. I dislike him almost as much as Bernie. During the '60s and '70s F1 was almost a spec series. Nearly all the teams ran Cosworth engines and Hewland trannies and were quite competitive. The difference was they weren't required to run them. They were competitive and affordable. I think this season shows you can't control engine development and that makes Max's spec engine unworkable. And even if you run a totally spec series like IRL, the teams with the most money (Penske and Ganassi and Andretti) win. They can afford to test and develop the cars more than the smaller teams. Either F1 continues as is or it dies. If your goal is to be the fastest car on the grid, cubic dollars coupled to a bit of engineering prowess always wins. Date Added: 10/12/2008
Andrew So Hondas biggest market is North America. There is a Moto GP race in North America and Honda are staying Moto GP, there are IRL races in North America and Honda are staying in IRL, there are no F1 Races in North America and Honda is pulling out of F1, Who knew? Well done Bernie! Date Added: 10/12/2008
chunter Andrew raises an interesting point, but there is more to it than geography: Honda's IRL entries actually make money, because the identical engines of Indy cars are leased (and not sold!) to the teams... in fact, a competition rule prohibits teams from working on the motors, engines must be returned to Honda if they underperform.While I don't know enough about Honda's motorcycle operations, I imagine they are cheaper than Formula 1 by far, if not revenue generating as well.The reason the notion of specification makes me ill is because the rules of IRL read too much like the rules of the Rotax Challenge: http://www.rotax.com/en/Engine/2004/Kart/Description.htmThose engines are sold but you're supposed to leave them unmodified, returning them every so many hours (of operation) for maintenance and that's it. It's a pleasing format for amateurs that like racing on weekends, but for professionals willing to spend millions a week to win, it's ludicrous. I don't know why the Andrettis, Penske, and Ganassi sink so much money to anonymously win Indy.If this is the only way to save all forms of motorsport, I guess it'll have to do... then again, that's what Americans have been saying about government buyouts and capital injections. Date Added: 10/12/2008
Nick Goodspeed Once upon a time F1 was a great gallery of ingenuity. Over time it has become a great cash cow to many and a massive advertising tool to others. As more and more cash has been injected each envelope has been pushed to an unsettling degree. The sportsmanship has just about disappeared as has much of the respect, on and of the track. Insane fines are levied, fines larger than the total budget of F1 25 years past. Engines cost a king's ransom. These days we read about a dark future for F1! The only ones with a dark future are the manufacturers, Ecclestone and Mosley. They have turned F1 into a monster that can no longer support itself due to its massive appetite. As most things that suffer uncontrolled growth, it achieves a critical mass, then can no longer support it self. F1 has been flogged beyond its limits, technologically, economically, ethically and by any other possible limitation. Those in charge are quite right. It cannot go on as it is. The cure is for them to leave F1. Then perhaps something can be worked out. The sooner those who's agendas are money before all, are gone, the sooner sanity will resume and racing will be done on the track. Date Added: 11/12/2008
Nick Goodspeed http://www.guardian.co.uk/environment/blog/2008/dec/11/network-climatechange Date Added: 11/12/2008
verasaki clive, you are just taking a much needed holiday for the off season, right? Date Added: 11/12/2008
Gusto clive, we presume you haven`t had any smelling salts after reading Nick`s piece, thus you are still incapacitated with the shock of Formula Milk Float. Date Added: 11/12/2008
Alianora La Canta I'm starting to get really, really worried. Clive, wherever you are, I hope you're OK and that you will be back blogging soon. Date Added: 13/12/2008
Clive I am back! Sorry about the long silence, folks - caused by a change over to FiOS (fibre optic system) replacing the DSL and a move that went wrong at every turn. I wound up with the computers in the new house but still having to stay in the old one for a week. It's a long story that I won't bore you with; suffice to say that normal service will be resumed from today (and the FiOS is great).It does seem that little has happened over the last week apart from the new agreements between FOTA and the FIA for cost-cutting and speculation regarding the Honda F1 dissolution. I will be having a look at these over the next couple of days - today's post should be up soon! Date Added: 15/12/2008
Alianora La Canta Glad to see you back, Clive :) Date Added: 15/12/2008
Haplo Carlos Slim went visiting Honda... Promise for my country... If he buys, then we can all hope for a proper race in Mexico some time soon!!!And, of course, a Mexican driver!!!woohooo!Just imagine a Cancun fantasy track ;) Date Added: 22/12/2008
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