The Great Game: Ferrari's Power Play And The Future of Formula One

Andy ShawCorrespondent IMay 13, 2009

SAKHIR, BAHRAIN - APRIL 26:  Luca Cordero di Montezemolo, Chairman of Ferrari is seen talking with Kimi Raikkonen of Finland and Ferrari  in the paddock before the Bahrain Formula One Grand Prix at the Bahrain International Circuit on April 26, 2009 in Sakhir, Bahrain.  (Photo by Clive Mason/Getty Images)

Yesterday's threat by Ferrari to leave Formula One at the end of 2009 was not unexpected by those who have been paying attention, but it brought F1's present power struggle into the eye of the wider public for the first time.

The Italian marque, who have participated in the World Championship since it began in 1950, revealed their intention not to enter the championship in 2010 if the FIA refused to back down over the rules it has said it will introduce next year.

The major sticking points are the £40 million budget cap, which will be enforced for the first time next year, and the fact that such a cap is optional, with technical restrictions on those teams who choose to run with unlimited spending.

The "two-tier" nature of next year's championship is what irks Ferrari and the other teams the most, with Toyota and Red Bull already confirming their intention not to participate in F1 next year if that proposal stays.

The FIA yesterday, before Ferrari's announcement, offered a simple and workable solution to the two-tier dilemma: If all the teams sign up to the budget cap, no two-tier formula will result.

The same would be true in the opposite direction, of course, but the FIA claims to already have notices of intent to participate in a capped Formula One from several new teams.

Furthermore, Brawn GP, Williams and Force India are all expected to sign up to the budget cap without any real objections, as an inability to spend promiscuously is what keeps these teams (Brawn excepted, of course, though without Honda's backing next year may otherwise be much tougher for them) firmly at the back of the field.

That leaves the manufacturers, along with Red Bull, who are expected to engage in a block boycott of the new regulations and not sign up for 2010 entry when the deadline passes at the end of May unless changes are made.

What is interesting is that Ferrari hold a slightly different position to the other teams on these issues.

They are the only team who object fundamentally to the principle of budget capping. All the other teams have stated that capped costs are a good idea, but that discussion needs to take place to ensure a suitable level of spending is permitted and that there is no prospect of a two-tier formula such as is already being talked about.

In all probability the two-tier system, as alluded to by the FIA in their statement yesterday, is a political move designed to give teams the "option" of participating without a budget cap, so as to ensure that nobody feels they were forced into signing up.

The FIA was expecting the option of running uncapped to be so unsavoury as to convince everybody that capped costs were the best idea, thus doing away with the whole idea of a two-tier system.

But they have underestimated the resolve of the teams to stick together and ride out this crisis. Efforts to undermine FOTA have not affected the unity of the organisation so far, and if the FIA can be brought to the negotiating table they will undoubtedly discover that FOTA will drive a hard bargain and not be forced into accepting unfavourable terms.

The problem is that Ferrari, as the ringleader of FOTA, has a slightly different outlook to the rest of its membership on what the best direction is for Formula One.

By demanding that the budget cap exist in no form at all next year, Ferrari are slowly alienating themselves from the other teams. This is exactly what the FIA wish to happen.

Ferrari's bold statement yesterday casts the whole sorry affair into sharper relief; it demonstrates to the world just how far this sport has regressed in recent years, with childish tantrums from grown men who do not get their own way, a bitter struggle for power and money that threatens to tear the sport apart.

And tear the sport apart it would do, were the teams foolish enough to listen to the incoherent protestations of an ill-informed minority and break away from Formula One as a whole. Such a split would not be a clean break—the analogy has been made with the formation of English football's Premier League, but in reality it would be more like the tumultuous schism between IRL and CART in the United States.

The Premier League succeeded because all of football's top teams of the time elected to break away from direct FA rule. In Formula One, that simply will not happen—Williams have already received money from FOM relating to a new Concorde Agreement, which commits them to the sport for a considerable period of time.

They will necessarily be absent in any breakaway series; legal action from FOM would likely bankrupt the already struggling company, so for one of F1's most prestigious teams, joining the rest of FOTA in a new championship, should one happen, is impossible.

Add to that the considerable draw of Brawn GP, F1's fairytale story for 2009, as well as the slightly less marketable Force India, both of whom are likely to stick with F1 regardless of what the rest of FOTA do, and you have something with rather less potential than the fledgling Premier League.

Interestingly, reports during the Spanish GP weekend surfaced that a new candidate may emerge to challenge Max Mosley's premiership of the FIA in the October elections. News like this does not emerge from a federation like the FIA without being fairly serious, so this shows that discontent with Mosley's firm grasp on power is rising, and that a new era in the FIA may be about to begin.

This is a weakness that FOTA can exploit if they hold their nerve and negotiate hard when the time comes to do so. The FIA will have to climb down from their present position, but there is no doubting that the teams—especially Ferrari—will have to concede a little ground too.

The alternative is too bleak a prospect to even consider.