Max Mosley: Budget cap still Formula 1's only hope for cost control

Formula 1's bid to control costs will only ever succeed if the sport accepts the need for a budget cap, reckons former FIA president Max Mosley.
With F1's chiefs and teams having failed to agree on changes that will drastically cut spending next year, grand prix racing's smaller outfits are resigned to an ongoing struggle to keep finances in check.
Mosley, who during his reign as FIA president from 1993 to 2009 campaigned hard to control costs, thinks F1 has to face up to the fact that trying to control budgets through ever-tighter regulations will end in failure.
"In the end I'm as guilty as anybody, because from 2000 onwards, I focused on the regulations." 
"The theory was, if you get the regulations right, you can bring the costs down. We found that wasn't true.
"For example, we tried to reduce the freedom for the engine builders - but it made no difference to the expenditure. Our achievement was simply to reduce the horsepower gained per million dollars spent. That's all.
"Then, following a logical sequence, we froze the engines. All the experts told me 'that's it now'.
"So what did [the engine manufacturers] do? They spent fortunes on the research to the airbox. And I think they found 30 horsepower. It's fascinating when they look at something nobody's bothered with.
"Eventually I realised that it didn't matter what we did with the regulations. We demonstrated that you cannot control costs through regulations. We had to bring in a cost cap."
Mosley's original push to introduce a budget cap in F1 in 2009 faced strong resistance from teams - and he had difficulties taking on the big manufacturers in the wake of the News of the World controversy that overshadowed his final months in charge of the FIA.
COMPETITIVE INCENTIVES
While Mosley understands the reasons why the sport's biggest teams do not want a cost cap imposed, he reckons incentives to boost the competitiveness of smaller outfits may weaken their stance.

"Why not allow a Formula 1 team which is prepared to operate within a very small budget to have greater technical freedom to bring them within a second or so of the frontrunners?" he said.
"To me that is so logical. It lets you demonstrate that somebody sitting in the grandstand will not be able to see the difference between the £50million team and the £500million team."
Mosley also believes that a more equal split of F1's commercial rights income would solve a lot of the teams' financial problems.
"If you ran it rationally, you would give everybody the same money," he said. "You would then arrange the budgets so the cost [of a season] was less than or equal to the amount of money you're giving them.
"You would then say to them [the teams] whatever sponsorship money you get, that's your profit. There's nothing wrong with making a profit, and it would just be a perfectly run thing. But life's not like that is it?"