In addition to the budget cap, Formula 1 also enforces a spending limit on Capital Expenditure (CapEx), funds that teams can allocate to infrastructure upgrades rather than direct investments in their racing challengers. Currently set at $36 million over a four-year period, this limit has been a topic of discussion, particularly among teams like Williams, which has been vocal about the challenges it poses.
Following the acquisition of the Williams F1 team by American investment firm Dorilton Capital in 2020, the team has been on a mission to rebuild, having faced financial constraints in previous seasons.
Williams’ boss, James Vowles, has been advocating for an increase in the CapEx spending limit to help smaller teams catch up. However, discussions on this matter stalled after an F1 Commission meeting.
Guenther Steiner, Team Principal of the Haas F1 Team, proposed a unique approach to address this issue. Instead of implementing a blanket increase in the CapEx limit, Steiner suggested that teams should spend up to the existing limit and then present their plans and justifications for requiring additional CapEx spending power. This case-by-case setup would allow teams to explain why they need more funds and gain approval from their fellow competitors.
Laying out his proposal, Steiner explained, “We have a CapEx limit now. Before anything is changed, someone has to go here and say: ‘I’m over it now’ and ask if it can be increased. And not just ask for the impossible. Then everyone comes here and can do it.”
He further elaborated on the approach, stating, “We have a certain amount of money now. Spend that once as fast as you can, and then report back how much more you need. That’s much better than just raising the limit.”
This case-by-case system would provide teams with the flexibility to justify additional CapEx spending based on their specific needs and priorities, ensuring a fair and measured approach to addressing the challenges posed by the existing limit.
