"FIA opens investigation into expenses of Red Bull, Mercedes, Ferrari and Aston Martin" F1
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"FIA opens investigation into expenses of Red Bull, Mercedes, Ferrari and Aston Martin"

"FIA opens investigation into expenses of Red Bull, Mercedes, Ferrari and Aston Martin"

The Italian newspaper La Gazzetta dello Sport reports that the FIA will conduct further investigation into the spending of the four top teams under the budget cap. The governing body of Formula 1 has issued a new Technical Directive, examining the influence of teams' expenses in other sports disciplines, with Red Bull Racing, Ferrari, Mercedes and Aston Martin drawing the attention of the FIA.

Since the introduction of the budget cap, there has been much discussion about monitoring the expenditures of the different teams. Red Bull was penalized last year for exceeding the budget cap in 2021, and it became clear that there are still many gray areas. Skillfully navigating these gray areas can result in the actual budget being higher than intended. The FIA now suspects that the four top teams are trying to take advantage of this.

Mercedes established large finance department

With this latest technical directive, the FIA aims to prevent personnel from being used for research beneficial to the Formula 1 team without including the associated costs. Just yesterday, Mercedes team principal Toto Wolff revealed that his team has set up a department of 46 employees to ensure compliance with the budget cap. These economists and tax lawyers will undoubtedly be working to find ways to keep the reported expenses as low as possible. For instance, personnel may be employed by subsidiary companies and they are only invoiced for hours specifically dedicated to Formula 1.

Red Bull, Mercedes, Ferrari and Aston Martin are the four teams with the highest budgets, and therefore, the four teams that have the most to gain from sweeping certain costs under the rug. The latest technical directive from the FIA specifically examines the expenses of teams involved in other sports programs, including boat, bicycle and road car design.

Both Mercedes and Red Bull are also active in the America's Cup, a high-level sailing competition. Red Bull is additionally involved in bicycle design, while the knowledge gained from designing the RB17, for example, can be useful for the Formula 1 team. Ferrari recently won the 24 Hours of Le Mans and can utilize the knowledge gained from that project to enhance the performance of its Formula 1 team.

How is the FIA going to fix this?

It appears quite certain that the teams are strategically using these activities in a clever way to improve the performance of their Formula 1 teams. The question, however, is how the FIA plans to counteract this. One possible option could be to prohibit employees actively working in a Formula 1 team from also working in another sport, although it will likely be a matter of time before teams find another method to increase their spending.

The team that could benefit from such measures is Alpine, known to have operated on a lower budget than the top teams even before the introduction of the budget cap. Additionally, Alpine team principal Otmar Szafnauer has expressed concerns about such auxiliary activities on previous occasions. The French team currently sits fifth in the constructors' championship, and drivers Esteban Ocon and Pierre Gasly occupy ninth and tenth positions in the drivers' championship, respectively, behind the eight drivers from the aforementioned four teams.

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