The F1 thread

fretmeister

chillidoggy said:

George Russell would do it for less.

No doubt. But he wouldn't attract the sponsors like LH does and it unlikely he'd win the title in his first attempt even in that car. He hasn't learned to do that yet.

fretmeister

Dontgiveupyourdayjob said:

I can never understand when you hear about superstar sportsmen negotiating contracts with wage demands. Whether it's Lewis Hamilton, Cristiano Ronaldo, Lebron James etc, why do they need to quibble over a few million here or there?

Surely Lewis could retire now, or drive for minimum wage for a few years, and still have enough cash in the bank to live in outrageous luxury for the rest of his life? 

Because it's market value. Money ensures both sides take everything seriously.
It's not a charity. It's far too dangerous a job for that.

It would also destabilize the market. If LH said he'd drive next year for £10, then the other teams will try to pay lower than that.

sammysaber

Yes and with the amount of money involved come a team of legal representatives - like when Hamilton lost a 3 year legal battle when suing Hamilton watch company, which existed before he was born : 

https://thetruthaboutwatches.com/2020/11/louis-hamilton-vs-hamilton-watch-company/

Guess his team will be suing Hamilton the musical next.

As said above, at this level sports stars are not charities but business entities.

dazzajl

sammysaber said:

Guess his team will be suing Hamilton the musical next.

Anything that means fewer musicals can't be all bad. 

PC_Dave

sammysaber said:

Yes and with the amount of money involved come a team of legal representatives - like when Hamilton lost a 3 year legal battle when suing Hamilton watch company, which existed before he was born : 

https://thetruthaboutwatches.com/2020/11/louis-hamilton-vs-hamilton-watch-company/

Guess his team will be suing Hamilton the musical next.

As said above, at this level sports stars are not charities but business entities.

Wow, I didn’t know about that. I love Hamilton watches and had joked previously that they were lucky to get away with using the name... didn’t realise he was that silly....

Brio

Old mate of mine started a kitesurfing brand called f-one.
the brand still exists. He told Bernie to go fuck himself when the lawyers came a calling. 

Cols

F1 drivers are unusually gifted and, in order to make it to the top level, frequently need to invest large amounts of money to grind through the lower formulae.  They deserve to be properly rewarded at the top level.

Unfortunately, at the moment F1 is not actually a profitable business for the teams.  There is a finite amount of money coming into the sport, and it is less than the amount of money being spent to go racing.  

As a result, most of the drivers are expected to bring money with them - directly or indirectly- rather than just being paid.  Grosjean and Magnussen didn’t lose their seats because they were bad drivers, they lost them because they didn’t bring money to Haas and Mazepin/Schumacher could.

In 2020, Hamilton’s salary accounted for almost 30% of the total driver’s wage bill for the whole grid.  And he’d like it to be an even bigger percentage in 2021.  At a time when the cake is shrinking, Sir Lewis would like an even bigger slice for himself.

stickyfiddle

Cols said:

In 2020, Hamilton’s salary accounted for almost 30% of the total driver’s wage bill for the whole grid.  And he’d like it to be an even bigger percentage in 2021.  At a time when the cake is shrinking, Sir Lewis would like an even bigger slice for himself.

Google suggests the cake is getting bigger - F1's revenue has consistently increased since Liberty took the reins. And Mercedes have spent fuckloads, but consistently reported profits. 

I'm 100% on making the sport much more sustainable for anyone outside the top 3 teams, as we've seen far too many other teams in financial trouble in recent years; but I don't think it has any bearing on top drivers' salaries. I suspect with the budget caps on team spend and driver salaries we'll see a shift to more direct sponsorship of drivers and lower salaries paid by the teams. 

What would be interesting (as a hypothetical scenario) would be to cap total spend including all salaries and not allow drivers to make money from individual sponsorship - then you have a question of how to balance wanting a top driver vs hiring the best technical team vs extra money spent on wind tunnels & testing.

Sources:
https://www.statista.com/statistics/1137226/formula-one-revenue/#:~:text=Global revenue of the Formula One Group 2017-2019&text=The Formula One Group's revenue,billion U.S. dollars in 2019.

https://www.espn.com/f1/story/_/id/29823419/mercedes-f1-spent-442-million-2019-made-money

Cols

Mercedes may have made a profit on paper in 2019, but I doubt many teams on the grid could claim likewise.  It’s also worth remembering that their income includes whatever Daimler choose to kick in every year, which was an estimated $80 million in 2019.  

Similarly Red Bull, Ferrari, Renault and Alpha Tauri all relied on significant subsidies from their parent companies in order to prop up the balance sheet.  Surprisingly, Renault is the biggest direct spender; as they receive much less FOM money than Merc, Ferrari and Red Bull they need to spend more in order to go racing on a smaller budget.

F1 has lost hundreds of millions of dollars in 2020, and it’s very unlikely to be back to business as usual in 2021.  Daimler has lost billions.  The once-mighty McLaren were on the brink of insolvency, while Williams saw the writing on the wall and put the ‘For Sale’ sign up.  Sponsors and consumers are tightening their belts, and it’s going to be a long time before the global financial situation improves.

The teams all realised that costs needed to be drastically cut in order for F1 to survive.  Without the cost cap and the flatter redistribution of prize money, I am absolutely certain that more than one team would have withdrawn from F1 by the end of the year.  The money simply isn’t there.

In the midst of all of this, while members of his own team are facing redundancy, Sir Lewis - already the best-paid driver on the grid - apparently wants a 20% pay increase.  I find it difficult to understand how he can be so grossly insensitive.

chillidoggy

It’s the 20% knighthood surcharge.

stickyfiddle

I think it's the Standard Negotiation Tactic given he's the most successful driver in the history of the sport.

I also wonder if it's even true, given Lewis himself suggested the extra stuff he wants is more around other initiatives, and not money-related. 

prowla

Saying that Daimler/Merc have lost money on F1 isn't quite getting the picture; they've changed the brand from a fading company who produced staid old folks estates and 3rd world taxis to a sporting marque, which has hugely boosted sales.

stickyfiddle

Yep, and they themselves quote the marketing value well into the billions. 

prowla

In that context, the cost of having the most successful driver of all time in the car is small potatoes.

dazzajl

I think we can nicely resolve a few threads here. Merc can save a load of money by swapping to Russell for next year. I’m sure Williams could be persuaded with a discount or technical help. 

Then Sir Lewis can leave to replace Jodie as The Doctor and usher in Doctor Who - The Musical. Where it’s remade in the style of Fame 

Fretwired

dazzajl said:

I think we can nicely resolve a few threads here. Merc can save a load of money by swapping to Russell for next year. I’m sure Williams could be persuaded with a discount or technical help. 

Apparently, the issue isn't just about money. Daimler only owns 33.3% of the team and look like they are slowly exiting F1. Hamilton wants more free time to do other things as he also plots a route out of F1. This has upset Daimler which banks on Hamilton doing a lot of promo work that helps sells cars. Hamilton is the only global star in F1 - Russell is a nobody at the moment. Hamilton will be driving a Merc for the next few years. It makes more sense to get Russell to partner Hamilton and replace the underperforming Bottas. Russell can learn from Hamilton and improve his racecraft.

INEOS could easily help fund Hamilition's pay part of which is performance-related. He'll have to win races and help get the F1 Constructors Title to get all his pay.

Cols

Mercedes are in F1 for one reason only; win on Sunday, sell cars on Monday.  As long as the expenditure on the F1 front is justified through increased car sales, the board is happy.  I’m not sure the added marketing value is billions as Wolff has claimed, but it’s certainly considerable.

Currently the F1 programme represents excellent value for money; the amount of funding Daimler needs to provide to the GP team is modest for the sustained level of success, with the majority of the budget covered by sponsorship and prize money.  And Hamilton’s been a significant part of that success, winning 6 of the 7 drivers championships for Mercedes since the beginning of the hybrid era.

Unarguably though, for all of those years the championship would have gone to a Mercedes driver anyway, such was the car advantage.  And if Hamilton had been in the 2015-17 McLaren, he’d have been performing heroics to sneak the car out of Q1 and grab the occasional point while another driver steered the Mercedes to championship glory.

So the question is: is the added marketing value down to the fact that Mercedes are dominant, or that they have Hamilton driving for them?  And, if one of his requirements is a reduction of promotional activities (and I couldn’t blame him), what does that do to his marketing value?

prowla

I don't get the "My grandad would be F1 world champion if they gave him the Merc." routine; there's a fair amount more to it than that.

Hamilton is there on merit and all of the down-talking is a bit lame.

The only person who beat him in the car was Rosberg and he bailed out of the sport straight after he managed to do it the once. When he joined McLaren he showed up Alonso, who many still consider to be one of the best.

Other teams have had a designated primary & supporting driver, but not Hamilton.

Whilst it's true that it is essential to have a competitive car to win, the bottom line is the best team can choose the best driver and the best driver can choose the best team.

Lewis Hamilton is plain and simple the greatest driver of all time and (presumably) he's not finished yet.

Brio

Funny how everyone is saying get Russell in the Merc and nobody is saying get Latifi. Almost like a good river in a poor car gets picked up asked to join a better team after showing his worth. Like Lewis was asked by teams to move up.
Like Alonso was, like Schumacher was.
Yes Hamilton is in the dominant car. But he earned his drive by showing he is a great driver.

stickyfiddle

Completely agree re Hamilton. I reckon...
- 80% of the grid could win a race in that car.
- 50% could win multiple races, and beat their teammate over a season. 
- 25% could win a title
- literally about 2 other guys could win multiple titles with the sort of consistency Hamilton has shown.