The budget cap has changed the way of working in F1

Since 2021, teams have a new set of rules to adhere to, implemented by the International Automobile Federation. In addition to the sporting and technical regulations, the FIA has introduced a financial regulation that limits teams’ actions in terms of expenses related to the development of the car. Therefore, teams still have an unlimited budget if they wish for marketing or other areas of their team. However, the development of the car is fully calculated and accounted for.

For Red Bull, Ferrari, and Mercedes, who were the three giants of F1 teams at the time, this completely changed their spending approach. They had to spend less but more intelligently.

« We have had the introduction of the budget cap which has changed the way we work. We have always had limited budgets, but now it’s a technical limitation and much more complex projects. We have cut back on our projects everywhere. We have kept a few, but we can no longer do everything. We have also reduced staff and therefore new parts. » explains the technical director of Red Bull, still led by Adrian Newey, a consultant for Red Bull.

The big stables are primarily restricted today by this financial regulation, but other stables that did not have the same resources are thus back in the race. Everyone is indeed almost on equal footing to compete in 2023. In fact, for the first time in the history of F1, all 10 teams are subject to a budget cap of 155 million euros to develop their race car.

However, disparities still exist between “small” teams and the giants. The teams with the best results continue to attract the best talents, which, in a virtuous circle, leads to even better results. Therefore, the question of human resources is very important in stables like Red Bull, which must carefully choose its engineers.

« I think that mainly the three top teams, Ferrari, Mercedes, and us, it has changed the way we work and it’s difficult to accept, we need to question the organization. » I believe that mainly the three top teams, Ferrari, Mercedes, and us, it has changed the way we work and it’s difficult to accept, we need to reconsider the organization.

Red Bull is also limited in its wind tunnel time.

The teams have a budget of over 155 million Euros in 2023. This budget allows for spending on the development of new parts, the purchase of raw materials, and also on wind tunnels and computer simulations. However, with the limitations on wind tunnel and Computational Fluid Dynamics (CFD) development quotas, Red Bull is suffering even more from this budget limitation. The team must therefore work more efficiently and cannot afford to make mistakes in the directions taken.

« As we finished first last year, we have less development time (CFD and wind tunnel, Note) than our competitors. Plus, we have a 7% penalty because we exceeded the budget by 0.3%, but it’s the regulation and we accept it. So, we need to find ways to develop the car with less development time. We have to do better with less, while competing with people who are, if not better, just as good as you in development, explains former Michelin engineer. » The former Michelin engineer expands on this.