Red Bull boss Christian Horner expects teams to be forced to skip races this season unless Formula 1‘s budget cap is increased.
The competition’s current cost cap stands at just under $200 million, down $5 million from last year with another $5 million still to be shed from 2023 onwards.
The FIA unveiled a three-year glide path in 2020 to allow more time for larger teams – namely Mercedes, Ferrari and Red Bull – to adjust the size and scale of their operations to ensure they do not spend too much.
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“Seven of the teams would probably need to miss the last four races to come within the cap this year,” Horner said.
“It’s not just about the big teams. It’s teams in the middle of the field who are really struggling with inflationary issues.”
With the COVID-19 pandemic, among other rising utility prices, causing huge financial strain, Horner said the FIA “needs to address” the problem before teams are required to choose between not attending races and sacking hundreds of workers.
There is also the argument that if the majority of the grid ends up breaching the cap this year, then the validity of the cap itself – to deliver a more competitive championship – is at risk.
“The FIA has a duty of care. I know they are taking it seriously,” he said.
“Energy bills, costs of living, costs are going exponentially, and F1 is not exempt. Freight has quadrupled and that’s not something we can control.”
But not everyone in the competition agrees with Horner.
Last month, midfield teams Alfa Romeo, Alpine, Haas and Williams teams all voted against a proposal for an inflationary adjustment based on the International Monetary Fund’s inflation figures.
Alpine team principal Otmar Szafnauer said all teams should have foreseen a rise in inflation and adapted accordingly.
“We’ve set our budgets early, we kind of anticipated a little bit of the inflation. Inflation didn’t just creep up on us. If we can do it, for sure others can do it too. I’m not for just increasing the cap,” he said.
“When freight costs go up by 2.5 million or 3.5 million but your development budget is 20 million, can you not make your development budget 17 million and still be under the cap? You can.
“What that then does is it limits your development. So it’s a lot easier, if you have the money, to go to the FIA and lobby to raise the cap and keep your development budget the same.”
It has been reported that some groups are concerned that the big teams are arguing the case for a budget-cap increase as a way of maintaining their high levels of spending – which relates directly to their race car’s level of performance.
In addition, some sources say they are trying to compound the effect of inflation into next year, which could end up increasing the cap by as much as $15 million.
There are three categories of cap breaches with three potential forms of punishment depending on the seriousness of the splurge.
One possible compromise is for teams to overspend by five per cent, an amount which is classified as a minor overspend breach in the financial regulations.
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