On Friday, Formula 1 teams and the FIA met for the Fi commission meeting to discuss the additional increase of the cost cap to counter rising global inflation. Several teams, including Mercedes and Red Bull, have spoken openly about the effects of inflation on freight and energy costs. The issues have been under consideration for a while, and the FIA finally came up with a solution. Formula One has provided an additional cap increase to cope with the rising transportation and fuel costs.
Last year, the FIA introduced the cost cap, restricting a team’s total budget on the car’s development to $145m per season. Moreover, the budget cap was further reduced by $5m in 2022. The financial restriction was introduced to induce more competition between teams across the circuit. It empowers small teams to compete with the development of bigger outfits with more financial advantages.
On Friday, ahead of the Austrian GP qualifying, the F1 commission came to an agreement on a 3.1% increase in the $140m cost cap, with a majority vote between the ten teams. Thus, each team will now have the luxury to spend around $4.3m above the original budget to counter the rising prices.
FIA Reveals The Revised Cost Cap For 2022
The F1 governing body announced that a rapidly rising inflation since 2021 end had affected the teams. Formula 1 and the FIA realized the rising cost creates a risk of items crossing the regulated cost cap this season if necessary actions were not taken. Hence, the FIA consulted with the Financial Advisory Committee in the past few weeks. The governing body came up with a proposal to raise the cost cap by 3.1% for the 2022 season. The proposal was approved with the support of the FIA, Formula 1, and nine teams.
Toto Wolff States Mercedes Spent A Third Of Their Increased Cap After Hamilton & George’s Crash
Mercedes’ team principal talked about the cost cap and the FIA’s decision. Toto Wolff said that the increase in the cost cap would certainly help, but it will not solve the problem. He pointed out that Mercedes, Red Bull, and Ferrari are already beyond the spending limits. The Mercedes boss further revealed on Saturday thet they have already blown a third of the increased cap allowance. They spent the money to fix the damage caused by Lewis Hamilton and George Russell’s crash during Q3 on Friday. He also appreciated the team engineers’ effort, who worked all night to deliver a good car for the sprint race on Saturday.