Formula One teams used to have a blank check on how much they could spend per season. Big teams like Ferrari and Mercedes had an insane advantage over other teams like Haas for example. However, in the past few seasons, the FIA has implemented a cost cap for all teams.
If a team breaks the limit of the rules, they will get fined and will have repercussions in the following season. This is something Red Bull had to deal with in the 2024 season after breaking the limit in 2023. The team also got reduced aerodynamic wind tunnel testing, which impacted the amount of information the team had about the car.
Mercedes Is On The Brink Of Breaching The Cost Cap!
After some unforeseen costs, the budget for upgrades has significantly lowered. It was especially from heavy crashes made by George Russel and Kimi Antonelli in an FP1 session. It is even so bad that Mercedes can’t afford to add any new upgrades to their cars, while other teams are still bringing upgrades each week.
The last upgrades are coming in Brazil, these were made before there was a risk of breaching the cost cap. However, it means that George Russel and Lewis Hamilton have to be extremely careful during the last 4 grand prix of the season. Which is something you don’t want if you’re still trying to compete to get some wins!
How Much Can Teams Spend?
In 2024 and 2025 the teams are allowed to spend up to 135 million dollars. However, some teams still can’t reach this limit because they don’t have the financial means. All the costs which are related to the performance of the cars are included in this cost cap. Things like the payroll of the engineers and workers are also included!
Before the cost cap was introduced, teams like Mercedes would spend more than 450 million dollars throughout the season! This was in 2020, while the Haas F1 team only had 80 million dollars available! A couple of years before that McLaren, Redbull and Mercedes all spent over 500 million dollars during the season!
