March 2014

Formula 1 teams believe the sport is heading into the unknown as it is impossible to predict how the Australian Grand Prix will play out this weekend. The major changes to the rules for the 2014 season appear to have shaken up the order, and the combination of the new 1.6-litre turbocharged engines and the 100kg-per-race fuel limit has left     most drivers and teams in the dark heading into the season opener. While some people in the sport have voiced concerns that the races will become fuel and tyre economy runs, others are predicting that the mixed up nature of the racing will be exciting. Ferrari team boss Stefano Domenicali believes it is wrong to judge the new formula before a race has even been run with the new cars. “Maybe people are saying that Formula 1 is a disaster, when in a couple of races you could have people saying Formula 1 is fantastic,” he said. “We need to make sure the racing is really exciting and let’s wait and see at the end of the year how the situation will be.” Lotus driver Romain Grosjean – whose team was one of a few that did even get to run a race simulation in testing – says things will be “complicated” for the drivers this weekend. “There will be a lot to think about in the car, and a lot of things are going to be asked of you by the engineers,” he said. “It’s not going to be nice to change all the settings on the steering wheel but this is the situation we are facing. Sometimes you have to change things four or five times a lap and it can be quite messy. It’s hard to get everything working together, but then it gets more normal and you get on top of it.” Caterham team boss Cyril Abiteboul reckons that even the squads that carried out race simulations in testing will not have a clear picture of how the races will play out. “The race will be strange,” he said. “The one thing you cannot test before you actually do is the race. Yes, you can do a race simulation but you are not racing against anyone. Racing against the others, finding the right compromise, the right tradeoff between properly racing and preserving energy, is something that we will have to see how it works. The way the race will unfold, it might be extremely interesting.” Grosjean added that he thinks that fans will be happy with the product as long as the racing is close. “We love the sport, we are passionate about Formula 1,” he said. “But the main thing is there is a good show. It is a big change of regulation and it’s quite extreme. Everyone said the cars look funny and they will get used to them. As long as there is competition between the cars then people will be happy.” Source: Autosport.

Norway’s $850 billion sovereign wealth fund made mistakes when it bought shares in Formula One and may try to sell them, its chief executive Yngve Slyngstad said according to a report in business daily Dagens Naeringsliv. Slyngstad said the fund may seek to offload the stake if corruption charges against its boss Bernie Ecclestone are not properly addressed. Several parliamentarians questioned last week whether the world’s largest sovereign wealth fund should have taken a $1.6 billion stake in the motor sport in May 2012 together with investors BlackRock and Waddell & Reed. Their comments came after newspaper Dagens Naeringsliv questioned whether the fund had violated its mandate by making the deal. The fund can only buy a stake in an unlisted company if it plans an initial public offering. After the deal was made, a planned Formula One IPO was canceled. “Yes, we made a mistake”, Slyngstad told Dagens Naeringsliv. “In retrospect, what is most unfortunate is what eventually has ended up in corruption charges.” The fund should have been more open about the terms of the deal and was wrong to have signed confidentiality agreements given that the planned IPO was suspended, Slyngstad was quoted as saying. In February a British judge found Ecclestone had paid bribes to a German banker as part of a “corrupt agreement” linked to the 2005 sale of a stake in Formula One. Ecclestone faces a bribery trial in Germany over the same deal. Ecclestone told Reuters after the British trial that he disagreed with the judge’s decision. He denied that he paid bribes to facilitate the sale of a controlling stake in Formula One held by German bank BayernLB to private equity fund CVC. The Norway wealth fund chief said the fund would not want to remain an owner in of Formula One if the company’s board does not respond to the corruption allegations in an appropriate manner. “We have zero tolerance for corruption,” said Slyngstad. “We have full confidence that the board is dealing with this. But it is clear that if this case is not handled properly, then we would not want to be an owner. In this case, we would not sit on these shares.” Slyngstad said he would have preferred for Ecclestone to have been formally suspended. The fund’s chief said the deal was still within the mandate of the fund because “the intention is still to list the company quickly when it is possible to do so”. The fund, which invests Norway’s oil and gas revenues for future generations of Norwegians, has an ethical stance. It talks with the 8,200 firms it invests in on topics from the equal treatment of shareholders to children’s rights. Source: Reuters.

Ferrari’s Fernando Alonso is Formula 1’s most marketable driver with Red Bull’s Sebastian Vettel only 4th despite winning the last 4 world championships, according to a report. The report by global sports marketing research firm Repucom found the Spaniard, a double world champion, enjoyed the greatest worldwide recognition. Britain’s 2008 champion Lewis Hamilton, who drives for Mercedes, was 2nd on the list and Brazilian Felipe Massa, who moved from Ferrari to Williams at the end of last season, took 3rd place. Finland’s Kimi Raikkonen, the 2007 world champion who has returned to Ferrari this season after leaving the sport and then making a comeback with Lotus, rated higher than Vettel in awareness but below him in overall marketability. “It may be a surprise to some that globally, Sebastian Vettel does not score as highly in terms of public opinion as the likes of Alonso, Hamilton and Massa,” said Repucom’s Nigel Geach, senior vice president of motorsport. He said that was due in large part to Ferrari’s popularity and brand recognition – the Italian team are the most glamorous and successful in the sport – as well as Alonso’s own international sponsorship deals. “Despite Red Bull’s recent successes, globally, 59% of F1 fans have an interest in the Ferrari team, representing the highest levels of interest in any F1 team,” added Geach. “With races screened across 160 global markets to a cumulative global TV audience of 1.8 billion, one can see the importance this can have on perception.” The report said Alonso was known by 71.14% globally, although only 12.76% of those in the United States were aware of him. Vettel’s global awareness rating was 54.30%. “Alonso is a very likeable driver and as the global appeal of the sport increases, people seem to be rooting more and more for a new F1 champion and as the results show, Alonso is starting to edge ahead as the fans favorite,” Geach said. The season starts with the Australian Grand Prix on Sunday and Vettel’s Red Bull team are already on the back foot after problems with their new Renault V6 power unit in testing. Hamilton and Mercedes are the early bookmakers’ favorites. Despite Hamilton’s global recognition being 2nd only to Alonso, the report found compatriot Jenson Button was more marketable to a British audience. “Button’s appeal, influence and aspirational scores see him as a better product endorser and a more marketable personality,” it said of the McLaren driver and 2009 world champion. Massa enjoyed the highest domestic recognition of any driver, with a 99.2% rating in Brazil compared to Vettel’s 97.58% in Germany. Source: Reuters.

McLaren is against the introduction of a cost cap in Formula 1, claiming it is unnecessary and it cannot be policed. Ahead of talks between teams over the next few months to try to finalise budget limits for 2015, McLaren Group CEO Ron Dennis has hit out at the idea. He thinks that it will be impossible for proper auditing of accounts of the big manufacturers to be conducted, and also reckons that teams should be left to adjust their spending according to their needs. “The issue is not the concept of a cost cap – the issue is that the regulatory process of monitoring a cost cap is almost impossible,” said Dennis, who has returned to a role of influence at his team this year. “It creates even more scrutinising of a car, not just in respect of its technical conformity, but also its fiscal conformity. The idea is to simplify some aspects of its design and designers are more than capable of circumventing the regulations correctly so they comply.” Dennis says historical issues where the FIA has taken time to determine the technical legality of cars would be amplified when it came to judging if teams had overspent. “Can you imagine the complexity of a whole set of regulations that don’t have anything to do with performance compliance but more about fiscal compliance? It is the practicality of the concept if you then had some sort of audit. “Let’s presume that a company wanted to circumvent. Let’s just say it was Daihatsu or Toyota – I don’t know about you but my understanding is that it takes years to understand how to write and read in those languages. So how on Earth the FIA will go into one of those companies and do an audit on what is spent on R&D or the component suppliers? Can you imagine trying to police that? It is pie in the sky.” He added: “If you cannot afford to be in F1, don’t be in F1. There are lots of other categories that you can go motor racing in. “It has been that way from the very, very beginning. For years Ferrari dominated F1 because they had more money. Things change. Suddenly they were faced with manufacturers who had equal amount of money.” Dennis also thinks that is illogical of the FIA to be so eager to bring in a cost cap when it was a key player in pushing through the huge expense of engine rules for 2014. “These engine regulations, for someone to turn around and say we should reduce the cost, when we had bullet proof engines the price of which was cascaded down and it was removed as being the essential ingredient of performance……. “Apart from the complexity, [it is] the most expensive engine in the history of motor sport. In the end you reap what you sow – and the same people who took us down this path, to then go down another path and say how we are going to reduce costs….. “My goodness, how contrary to logic is that?” Source: Autosport.

              With pre-season testing done and dusted in Jerez, Spain and Sakhir, Bahrain, the 2014 Formula 1 season which is going to usher in a new era of 1.6L V6 Turbo-charged engines will officially kick off in Melbourne, Australia on Friday, 14th March with the main race on Sunday the 16th. A lot of anticipation awaits on how these cars with new power units will thrive under the new regulations set by the FIA, world motorsports governing body. Now that all these new cars have gone through testing, here is a preview of the 2014 Formula 1 cars.                    MERCEDES F1 WO5   REDBULL RB10   FERRARI F14T   McLAREN MP4-29   FORCE INDIA VJM07   WILLIAMS FW36   TORO ROSSO STR9   CATERHAM CT05   SAUBER C33   LOTUS E22   MARUSSIA MR03 Photos courtesy of  Autosport