F1 mulls new breakaway split over Mosley rift UPDATE #5 A private equity-led takeover of Formula One stunned the Grand Prix paddock. Now the threat of a breakaway by leading teams is causing more disarray, write Christian Sylt and Caroline Reed
It all started with a few slaps to the backside. However Max Mosley's now-infamous S&M exploits seem set to spark a rival motor racing series that could leave F1, and Royal Bank of Scotland, its biggest creditor, in the dust.
Mosley has single-handedly presided over one of the biggest scandals ever in the billion-dollar sport. Despite car companies and auto clubs representing tens of millions of motorists calling for him to step down as president of F1's governing body, the Fédération Internationale de l'Automobile (FIA), he refused to resign following lurid revelations about his private life. Heads of state said they did not want to be seen with him, preventing Mosley from attending many of this year's Grand Prix events.
Yet earlier this month Mosley won a vote of confidence from the FIA's members who viewed the attack on him as an attack on the federation. Mosley has made it abundantly clear that he is not leaving F1 - but at last week's Canadian Grand Prix, it came to light that F1 might instead leave Mosley.
A series of crisis meetings was held at the race to consider how the sport could survive the damage being done by Mosley to its slick and squeaky-clean reputation. More than 300 sponsors invest nearly £500 million in supporting F1's 10 teams and expect this to bring image benefits to them - not association with a sordid scandal. One team boss reportedly said that "many (sponsors) are even threatening to cease their payments if Formula 1 does not solve the problem with Mosley".
Chairing the meetings was Bernie Ecclestone, the 77-year-old chief executive of F1's commercial rightsholder, and he is said to have come up with the radical solution of starting a new series under a different brand to run outside the FIA. As one senior team source suggested: "The manufacturers supply the cars and the drivers and the sponsors, Bernie has the contracts with the circuits and the TV companies. ... Max is just the referee. The FIA blows the whistle."
In a case of stalemate over the future of F1, a new series would be one of the only ways forward. The commercial rights to F1 are in fact the commercial rights to the "FIA Formula One World Championship" since the FIA founded it in 1950. As a result of this, F1 could not be run under any other governing body and so the only way for the participants to distance themselves completely from the FIA would be to start a new series.
"I don't think it is the first option. We would prefer to work with the FIA if we can," said Nick Fry, Honda GP's chief executive, when asked about the possibility of a breakaway series. Ultimately the pressure of finding a solution may be too great to avoid it. "We need stability, consistency and the right values and images for Formula One," says McLaren's boss Ron Dennis. He adds: "If anything is put forward as an initiative that is in the best interests of Formula One and this company I will support it. It's highly unlikely that Formula One will look the same as it does today in five years' time."
An indication of exactly what F1 might look like in future can be found in the intellectual property portfolio of Formula One Promotions and Administration (FOPA), Ecclestone's private company. The company has a suite of pan-European registered trademarks which seem ready to roll out on a new racing series.
The three most crucial of these trademarks are for GP1 and GP3. These are in addition to GP2, which is already up and running as F1's feeder series. The registrations cover a wide range of categories including organizing and staging sports events, broadcasting, sportswear and timing equipment. Although the original applicant of the GP3 mark was not FOPA but an Italian business, Ecclestone's company took it over in October 2006 and, perhaps most tellingly, it now has a logo which looks remarkably similar in design to GP2's brand.
These three tiers of brands would also seem to mirror those of F1's rival A1 Grand Prix, which has A2 and A3 feeder categories. It is a strategy which has clearly been on Ecclestone's mind.
Last year, when interviewed about his hopes for his football club Queen's Park Rangers, he compared its progress to rising through motorsport categories, saying: "We're in Formula Renault at the moment. Next, we want to move up to GP2 and then GP1." In less than 12 months this could be a reality as reports from Canada claimed that there was a deadline for Mosley to resign by this Tuesday and failing that, the new series, with F1's current participants, would be given the green light for 2009.
It would be a big risk given that F1's globally renowned brand has undoubtedly played a part in accelerating the sport's annual turnover to £657 million. However, backing a new series could maximize the return on investment for CVC, the private equity house which majority-owns F1's commercial rights holder. Telegraph.co.uk06/16/08 This rumor is upgraded from 'false' to 'speculation' with this news item that Ecclestone admits a breakaway series is possible.
06/13/08 Bernie Ecclestone has played down rumors of a breakaway championship. Talks were held at the weekend to try and lay out a new Concorde Agreement, but there were rumors that teams were also discussing whether or not to break away from the FIA and form a new championship.
“I’m certainly not advocating a breakaway, but in theory they could do their own deal, for TV or whatever,” Ecclestone explained in an interview with British newspaper The Sunday Express.
Ecclestone has since sent a letter to all FIA clubs clarifying the position of himself and the team.
The letter reads, “The position of Formula One Management and the teams and the Formula One promoters is very simple. “They would like a Concorde Agreement signed in basically the same format as in the past agreements which Formula One has been governed successfully by this type of document for over 25 years which helps to stabilize the Technical and Sporting Regulations.
“It follows the agreement reached with the European Commission where the FIA are the regulators of the sport and FOM are the commercial side of Formula One. We would hope that this can continue.
“As far as the FIA president is concerned this has now been made clear and there is not a change in the position at this time,” Ecclestone added.
“A number of the manufacturers and teams along with their sponsors have stated that they thought the president should stand down because of matters in his private life.
“This is their and only their opinion as they are not part of the FIA and therefore do not have votes.
“Personally Max has been a friend for 40 years and I hope he still is. He has in his way carried out many matters which have been beneficial to the FIA and should be appreciated for this.”06/09/08 (GMM) Ferrari and McLaren have played down rumors that formula one teams could abandon the currently FIA-sanctioned championship to race in a separate self-governed series.
It was rumored at Montreal that bosses held two meetings with Bernie Ecclestone where the concept of abandoning the Max Mosley-led federation was seriously raised and discussed.
"I can say definitively that we need the FIA as our arbitrator," Ferrari principal Stefano Domenicali is quoted as saying by the German press on Monday.
In a statement, meanwhile, Woking based McLaren said it hoped the sport "will now enter a period of stability" in the wake of the Mosley sex scandal and Paris vote.06/07/08 This rumor is downgraded to 'false' today. Bernie Ecclestone on Saturday played down speculation he is hatching a plot for a 'breakaway' championship.
"Nobody has discussed a breakaway series," the 77-year-old F1 chief executive told reporters in the new media centre at Montreal's Circuit Gilles Villeneuve.
Sources in the paddock insist that the press reports of a possible split with the FIA, thus solving his quarrel with FIA president Max Mosley, were triggered by off-the-record remarks to journalists made earlier this weekend by Ecclestone.
It was claimed that he met with team bosses on Friday to discuss moving away from having the Paris based FIA as regulator.
But Ecclestone insists that the two and a half hour meeting was simply to discuss the contents of a new Concorde Agreement, which Mosley has been reluctant to agree to.
He stopped short of suggesting the sport would be better off without the FIA.
"There wouldn't be any difference, they'd still be arguing amongst the teams about what they want," Ecclestone said.
John Howett, president of the Toyota team, also played down reports that the F1 teams are nearing unanimity about wanting to split from the FIA.
Referring to a new Concorde, he told Reuters at Montreal: "For most of the teams, they want that to be a tripartite agreement involving the FIA as in the past.
06/07/08 (GMM) The shadowy world of formula one politics has crossed the Atlantic from Paris to Montreal's Ile Notre Dame.
The big rumor in the paddock of the Circuit Gilles Villeneuve late on Friday was that F1 supremo Bernie Ecclestone is hatching a plot for a breakaway championship.
The news is a logical development in the highly contentious Max Mosley sex scandal, but Ecclestone's rift with the FIA president is actually much deeper than that.
As alluded to by the FIA president in a recent explanatory letter, Ecclestone and the F1 teams want Mosley's signature on a new and revised Concorde Agreement; a highly secretive document that binds the teams with the sport's separate commercial and regulatory aspects.
Team bosses met with Ecclestone for nearly two and a half hours on Friday, and speculation following the meeting is that - despite the notorious difficulty in getting F1 outfits to agree - unanimity on this issue is not far away.
"We want Max's signature on a new document," Bernie, 77, was quoted as telling The Independent earlier this week.
"He doesn't want to do that because he feels he has more power if he doesn't sign. But he doesn't need more power.
"The big manufacturers know just how much they want to spend to be competitive. We just need to write the regulation to achieve that, and move forwards," Ecclestone added.