F1 Chief, Stefano Domenicali, has acknowledged that some long-time members of Formula 1 are struggling to accept the new budget cap, but emphasized that it is vital for the sport’s competitiveness. Since 2021, teams have been restricted to a spending limit of $145 million, which will decrease further over the next two seasons. While the move was intended to level the playing field, Red Bull’s penalty for breaking the cap and still winning the 2021 Drivers’ Championship fueled criticism of the rule’s effectiveness.
Domenicali suggested that resistance to the cap stems from the old school way of running things. In a recent F1 investor call, he said that while it has been challenging to implement the rule among long-time F1 people, it is essential for creating more competition on the track. The former Ferrari team boss praised the cap, calling it one of the most complicated rules to police, but also the fairest.
Domenicali explained that the financial rules are complicated to manage because the physicality of each country is different, and some teams are part of a manufacturer with other entities building up resources for the team. The complexity requires a strong team to manage the control, which the FIA is working to develop. Domenicali emphasized that the cap is one of the pillars that make the system strong because it forces teams to think differently about how to manage the development of the year.
He acknowledged that even Sprint races, which are growing in number, have an impact on the budget cap. Domenicali explained that they need to control the cap differently, which is better for the unpredictability of the sport. Last year, the FIA heard whispers about a team breaching the cap only in October, even though the teams submitted their numbers in March. Domenicali has urged for an earlier resolution before the summer break this year.
He believes that it could be even more critical for the 2022 financials, as Red Bull claims that up to six teams may have breached the cap. Despite the initial resistance, Domenicali said that the budget cap is crucial to creating more competition and leveling the playing field in F1, and he hopes that teams will embrace the new cultural frame that it provides.