Marussia will start 2014 debt-free
Marussia, the Russian manufacturer owner of the eponymous team, has decided to clear the team's debts for the 2014 season to better prepare for its future.
The debts accumulated since its arrival in F1 in 2010 are impressive as they have reached the level of 130 million pounds, or 156 million euros. Thus, in the 2012 season alone, the increase in debt amounted to no less than 57.6 million pounds.
Such debts are not necessarily a very big surprise for a F1 team as they are slightly higher than those recorded by Lotus during the same season (£56 million). Andy Webb, the CEO of the team, stated to the Times: « The figures may be daunting at first glance but we have restructured in a way that allows the team to start this new fiscal year debt-free and with a clear path forward, thanks to our investors. »
The question is to know with whom this debt was contracted. Indeed, the strategy implemented by Genii Capital at Lotus is that the investment fund made loans to its team. It should be noted that the British fund LDC was a shareholder of the team for a long time before selling its stake last April. LDC had also made a loan of 38.4 million pounds in 2011. The repayment of the team’s entire debt was therefore certainly included when the shares were sold.
For the team, this announcement helps to strengthen its communication about its intention to have a lasting presence in F1: « Our investors were incredulous regarding the cost structure in F1. They didn’t expect to enter into a spending competition but they have placed us on a solid foundation and our future is assured. »
It’s all the more important because Marussia is the only team without a commercial agreement with Bernie Ecclestone, resulting in an estimated $10 million shortfall for the 2013 season. During our meeting in Monza, Graeme Lowdon, the team’s president, explained the consequences of this lack of agreement to us: « There is a lot of competition in F1, but like everywhere, you need stability. You need the opportunity to plan things. Where this has already harmed us as a team is that unlike the other teams, which received additional money, we received less than we expected. This will inevitably impact our technical program because if you have more money, you can make your car faster. If your car goes faster, you can rank higher in the championship. If you finish higher in the championship, you can receive more money. It becomes a cycle. So if you break this cycle, as has happened, it harms the team. It is our role in management to ensure the business is protected and can move forward. It’s certain that it’s not a good thing not to receive the money you expected to receive. »
Like the other teams, Marussia will have to face increasing costs next season with the introduction of the new engine block featuring the turbo V6. Having solid finances is therefore essential to cope with the development costs incurred by designing a new car from almost a blank sheet.
With the participation of www.Racingbusiness.fr
