Horner warns of ‘catastrophe’ over budget cap

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Red Bull's Christian Horner at the Canadian Grand Prix. Montreal, June 2022.

Red Bull boss Christian Horner believes issues regarding the F1 budget cap have become “moral” as discussions continue.

Horner has been the most vocal of voices regarding a push to increase F1’s budget cap, in light of unprecedented inflation and spiralling freight costs.

With the sport’s financial regulations for 2022 reducing the budget cap to $140 million, Horner has spoken of the fear of teams potentially having to miss races towards the end of the year in a bid to stay within that cost cap.

The regulations enforce the cap of $140 million on all car and performance-based costs, with costs such as driver salaries, personnel logistics and accommodation costs, human resource and finance department costs, and marketing all falling outside of the cap.

With teams facing the prospect of finding ways to cut spending to meet the cost cap, which was thrashed out well before the current inflationary period, Horner said the issue had become increasingly important to solve.

“The problem with the uncertainty with the cap, with the rate of inflation we are seeing, there is only parts and people that are really the biggest cost drivers,” said Horner, as quoted by GPFans.

“It would be a catastrophe for Formula 1 that people would have to take a hit for something that is beyond their control.

“There is a moral issue that needs to be dealt with and I know the FIA are looking at it together with the Liberty guys.”

A formal decision to increase the budget cap is yet to be made, with some teams not in agreement that a cost cap increase is necessary.

Horner reckons that some of the teams will struggle to keep within the limit.

“The way you design your car is within your control,” Horner told Sky F1.

“That is something that you, together with your group of designers, you create. You’re in control of your own destiny. What we’re seeing in the world at the moment, we’re not in control of the inflationary costs that are affecting households around the world. In the UK, we’re seeing predicted inflation at 11 percent.

Christian Horner looks at the Miami pit lane. Miami, May 2022.

“That’s a direct effect on staff, on raw materials, on electricity, on commodities, on supplied parts. I think it genuinely is a force majeure situation that the FIA needs to deal with.”

While Horner’s vocal stance on pushing for an increase to the budget cap could be interpreted as Red Bull’s own position in relation to meeting the budget cap requirements, the team boss said other teams are quite likely to be in a worse position.

“Nobody could have expected this kind of inflation,” he said.

“Perhaps I am the one who speaks out about it the most but our problems are not the biggest in this area.

“I think Mercedes employ more people and have higher salaries within their group than ourselves. Ferrari is again another big team with high costs.

“When you hear of teams in the midfield that are also going to be in breach of the cap that were pushing for the cap to be lower originally, it shows it is not about development being the biggest contributor to these costs.

“It is just the fixed costs of going racing, with freight, with energies, with the supply of components which has just gone stratospheric.”