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Posts Tagged ‘formula one’

BMW Sells Formula One Team Back to Sauber

One-third of workers are immediately sacked. Agreement is contingent on having a starting place for 2010 racing season.

by on Nov.30, 2009

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Whether a place on the grid is offered to Sauber remains to be seen, as the costly and scandal wracked business continues to be roiled by defections of major automakers.

BMW AG agreed to sell its 80% ownership in the BMW Sauber F1 Team to founder and former owner Peter Sauber at the end of last week.

The contract is subject to the team having a starting place for the 2010 Formula One season, which up to this point is unknown  because the sanctioning body, Fédération Internationale de l’Automobile, mistrusted the proposed mid-east financing of a restructured team. This previous announced deal from a murky mid-east based company called Qadbak Investment Ltd is now off.

Whether a place on the grid is offered to Sauber remains to be seen, as the costly and scandal wracked business continues to be roiled by defections of major automakers, among them Honda, Toyota, BMW and tire supplier Bridgestone. Renault is also said to be examining its costly participation.

Racing Views!

Racing Views!

Moreover, Ferrari, the unquestioned superstar marque of the series among fans, is apoplectic about one proposal to cut the obscene costs that are driving other makers away. It would see a spec engine replace the highly specialized, breathtakingly expensive, custom engines now in use. Ferrari’s entire marketing plan is based on its often-successful participation in Formula One, of course.

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Formula One Racing Exodus Continues as Toyota and Bridgestone Announce Exits

Only Ferrari, Mercedes-Benz and Renault will compete as makers during the next racing season that starts in March.

by on Nov.05, 2009

The extreme costs and super rich image is driving makers out of Formual One.

The extreme costs and super excessive image is driving automakers out of Formula One.

Toyota Motor Corporation is leaving the super expensive Formula One racing circuit next year. Bridgestone, a major supplier to Toyota is withdrawing the year following.

The latest moves to cut team costs of almost half a billion dollars annually for leading marques means that only Ferrari, Mercedes-Benz and Renault  will compete as makers next season.

Ferrari is threatening to leave the series as well. Honda and BMW had previously withdrawn.

Race With Us!

Race With Us!

Lotus Cars, now owned by Proton, is returning after a 15-year absence. In addition, several new smaller teams are thought to be preparing low budget entries for the new season, which starts in March. Previously, Lotus said it plans to spend only $90 million next year, compared to Toyota’s estimated $500 million annual investment in the hugely popular global sport.

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Formula One Threatened With Season Cancelation

Eight teams, with Ferrari leading the way, walk out of an FIA meeting on cost-cutting. Will Toyota bail out entirely next year?

by on Jul.08, 2009

Last year for loss making Toyota in ultra-expensive F1?

Last year for loss-making Toyota in ultra-expensive F1 Championship as the Great Recession wins?

There’s the sport of racing, the business of racing and the politics of racing.

All three are being negatively affected by the ongoing Global Great Recession and the wallop it has delivered to automakers.

Nowhere is this clearer than in Formula One racing, once considered the pinnacle of the sport. And well it should have been, went its wildly profitable promoters, considering its international audience reaching a claimed 100 million or more for some races, and drivers who routinely made $20 million-plus annually as they flew in private jets to some of the world’s most expensive and exotic locations.

But that may soon be past tense

Last month, the Formula One Teams Association, comprised of the top eight FI teams, threatened their own racing war of independence from the sport’s sanctioning body, the scandal-wracked Federation Internationale de l’Automobile (FIA).

A war of words ensued, with the FIA saying “lawyers have now examined the FOTA threat to begin a breakaway series. The actions of FOTA as a whole, and Ferrari in particular, amount to serious violations of law including willful interference with contractual relations, direct breaches of Ferrari’s legal obligations and a grave violation of competition law. The FIA will be issuing legal proceedings without delay.”

Free Pit Pass!

Free Pit Pass!

Ultimately a compromise was reached that — it was claimed at the time– would significantly cut the costs that teams incur by designing, building and running extremely sophisticated, purpose-built cars for one season. Ah, but that gets into the business and politics of racing, which are as conflicted by as many agendas, as there are teams competing to win.

Well, here we go again. The Associated Press has just reported that FOTA has walked out of a cost cutting meeting in Europe earlier today.

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Daimler Chief Commits to Formula One for 2009

Conserving cash can wait when it comes to racing, says fan and Mercedes-Benz head Dieter Zetsche.

by on Apr.09, 2009

TK

A Formula One team runs between $100 million and $200 million annually to maintain.

Daimler AG plans to stick with Formula One racing despite the company’s need to conserve cash and in the face of ongoing controversies regarding the conduct of its McLaren Mercedes team.

Dieter Zetsche, Daimler’s chief executive officer, said the company will police the company’s Formula One expenditures more closely and watch budgets more closely, after he was pressed by stockholders at the annual meeting. The maintenance of a Formula One team runs between $100 million and $200 million annually, and several manufacturers have begun expressing doubts about the overall value of  the Formula One racing circuit.

Honda pulled out of the 2009 season to conserve cash by selling its team, the automotive equivalent of selling the crown jewels. While Ferrari took the works title, McLaren driver Lewis Hamilton took the driver’s championship last year.

Several shareholders challenged Zetsche to justify his spending money on Formula One at time when it is losing money and more than one third of the company’s workforce in Germany is working short work weeks. In addition, Daimler is also asking the company’s works council for an additional $2.6 billion in concessions. Daimler has lost significant sums in the past two quarters and faces a liquidity crisis.

However, Zetsche, who considers himself a racing buff, said Formula One remained a valuable tool for the Mercedes brand, which has to spread its limited marketing dollars around the world. (more…)

Ferrari, Nothing Succeeds Like Excess!

Italian supercar maker bucks a downward trend.

by on Feb.11, 2009

Recession?  What recession?

Recession? What recession?

We love to talk conventional wisdom, at TheDetroitBureau.com, especially when it’s wrong. So, pundits like to say that the global economic crisis is taking a particularly hard swipe at the luxury car market. Maybe they’re right when it comes to Mercedes-Benz and BMW. But don’t tell that to the folks down in Modena, who can’t keep up with demand for anything badged Ferrari.

Ferrari’s record year end results for 2008 show no effects of the deepening global financial meltdown as the Italian sports car maker emphasized the customization of its expensive V-12 powered supercars. The marketing effort was bolstered by its 16th Formula One Constructors Title, the eighth in the last decade.

Ferrari ended the 2008 financial year with revenues of 1,921 million euro (1 euro: $1.2964) an increase of 15.2% from 1,668 million euro in 2007. This rise was attributed to sales of the V-8 powered 430 Scuderia (~$190-250,000), the 612 Scaglietti and 599 GTB Fiorano (~$250-315,000). The 12-cylinder models benefitted from the launch of a One-to-One Personalization Program that can significantly increase the “base” prices. The company said efficiencies also helped compensate for unfavorable dollar and sterling exchange rates.

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