Alpine Team Principal Explains How Formula 1 Teams Could Exploit a Budget Cap Loophole

Formula 1 is sometimes referred to as the peak of motorsport. While quite a few people might disagree with that, it bears that moniker because innovation is, or at least used to be, its foundation.
Otmar Szafnauer 13 photos
Photo: BWT Alpine F1 Team
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It is worth keeping in mind that innovation and finding solutions to complex issues are still at the forefront of Formula 1. However, this has been somewhat stifled by strict regulations and the cost cap introduced in 2021.

But, as expected, teams are either breaching it (like Red Bull did) or are trying their hardest to find loopholes. And it’s none other than Alpine F1 team principal Otmar Szafnauer, a man used to getting results with limited resources, as shown by his days with Force India (currently Aston Martin), who sheds light on the matter.

He explains how despite the rules being initially effective in hitting the big teams, like Mercedes, Ferrari, and Red Bull, and leveling the playing field, this is no longer the case. Alpine was in the right spot as far as spending goes when the budget cap was introduced, and thus benefitted from that.

However, big teams are catching up and learning how to better manage their resources and staff. Szafnauer explains that this can be achieved by 'juggling' staff around. The Alpine boss did not get into too much detail, but he did use some keywords that give away a lot of how this could work.

According to him, “I got rid of 100 people, but now I want to hire them back. Because I was able to under that budget cap, find spots for them, where they either don't count as a whole person or they do some marketing stuff or whatever it is, or they work on a boat for some of the time.”

This could sound confusing so let’s take a closer look. What the loophole that he speaks about could allow, is for teams to only hire their staff for let’s say half the year in Formula 1, then move them to their other divisions, where their salary would not count towards the cost cap.

Through clever management of their resources, top teams could hire quite a few extra people to help with development without incurring any financial hit to the cost cap. Obviously, this is something that smaller teams cannot really take advantage of, as they can barely find the money to fully use their allowed budget.

Large teams are the ones that could heavily benefit from this kind of loophole, making the introduction of the cost cap redundant. They would yet again be able to outspend the competition and gain an advantage, the exact thing that the new rules are trying to stop from happening.

Szafnauer admits that Alpine itself in employing this strategy, albeit to a lesser degree. He claims the team only has a department consisting of only two people. He states that no real advantage comes from that, at least in Alpine’s case. However, he points out that for large teams, the staff increase could be a lot larger and provide a sizeable lead in development.
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About the author: Bogdan Bebeselea
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As a kid, Bogdan grew up handing his dad the tools needed to work on his old Citroen and asking one too many questions about everything happening inside the engine bay. Naturally, this upbringing led Bogdan to become an engineer, but thanks to Top Gear, The Fast and the Furious series, and racing video games, a passion for automotive entertainment was ignited.
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