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VW Group and F1: The stand with Porsche and Audi

The interest in entering Formula 1 is said to be great in the VW Group. But little has changed for months. We talked to players in the paddock about the possible status.

Formula 1 has returned to its usual flight level after the Corona slump. Rights holder Liberty Media reported sales of 2.136 billion US dollars with the fastest division in the world for the past financial year. The ten teams received 1.068 billion of them.

Before Corona they took less. The Formula 1 platform and its teams are on a stable footing, says sports director Ross Brawn. The budget cap creates a control mechanism. This year it's just over $140 million. In 2023, the budget ceiling will fall by another five million. In addition, Formula 1 will soon also cap expenditure on the engine side.

Everyone has the chance to be profitable. This prospect attracts new prospects. US team Andretti would like to enter in 2024, but are viewed with skepticism by potential rivals. As usual, they fear that someone will take a piece of the pie from them. McLaren, Alpine and Williams, on the other hand, are more likely to spread their arms. More competition stimulates business.

Andretti would first have to pay 200 million dollars for entry. This would cover the shortfall in income for everyone else for at least two years. And: Andretti would probably continue to heat up the US market. That could drive up total Formula 1 sales. All teams would benefit from this in the long term.

Audi is digging into McLaren

Mercedes team boss Toto Wolff likes to talk about the Champions League of motorsport. It also means that it is best to only open the door to the exclusive club for the really big names, i.e. the manufacturers. Audi and Porsche would be like this as global brands. Both are said to be very interested in joining from 2026.

Then an engine regulation will take effect, which should make the premier class greener with about 50 percent electric content and 100 percent sustainable fuel. A set of rules intended to simplify the powertrain without the hot electric machine MGU-H. That was the wish and condition of the VW Group. The FIA ​​and F1 management would certainly not hesitate for a second if both wanted to come.

It seemed to be heading towards a decision at the end of 2021. On December 15, the World Council of the FIA ​​​​published the key points of the new engine regulations - under the motto: "more sustainable, simpler, cheaper." A bridge for newcomers, which VW initially did not cross. Instead, things have gone quiet. Negotiations are underway, little is leaking out.

In the Formula 1 paddock, they say that Audi is still digging into McLaren. However, there would be little reason for the British to sell. With the entry of the US sports investment group MSP Sports Capital (33 percent by the end of 2022), fresh capital has flowed.The deal, which was announced at the end of 2020, valued McLaren Racing at £560m at the time.

Do electric strategy and F1 fit?

The more Formula 1 grows, the more it booms, the more valuable the teams become. Thanks to Liberty's work, the premier class is gaining a lot of viewers, especially a younger audience via social media and Netflix. In such an environment, with the budget cap as a cost limit and as a member of the exclusive club, a team like McLaren could soon be worth more than a billion.

Another thing: Audi only wants to build new electric cars from 2026: someone in the paddock asks the question: Does this orientation even fit with hybrid Formula 1? Porsche, on the other hand, has synthetic fuel for its sports cars on the radar.

There are those who think that VW has already missed the perfect time to get involved with its subsidiary brands. By a year or even two years considering the probable increase in value of each team. In 2020 it would certainly have been easier to do business with McLaren. Or with the second traditional English racing team Williams. Both were short of money at the time because of Corona.

The VW Group did not make the quick decision to use Formula 1 as a marketing platform and possibly as a money-making machine. Perhaps the structures are just too rigid for that. A large manufacturer does not know lean management with short decision-making processes. Insiders explain that every process at Volkswagen has to go through many committees. It takes time because it always involves discussions.

Everything must be calculated for the board and supervisory board down to the last cent. That's why a connoisseur predicted in January that the decision could drag on for months. The advantage of a large manufacturer: When a project is finally given the go-ahead, all resources are used to ensure success.

Time pressure is increasing

One team that is repeatedly mentioned in connection with a possible VW entry into Formula 1 is Williams. The racing team has been owned by the private US investment company Dorilton Capital since 2020. It can be heard from Williams circles that they are ready for talks in all directions. Sure, Dorilton would certainly listen to good offers. There is no pressure. And in the VW Group, a decision must first be made for serious negotiations.

You shouldn't hesitate for too long. "They should already know in the first half of the year. After all, an engine has to be developed and built. It should be put to the test at the end of 2024. It's sporty to build up an infrastructure for Formula 1 within this time." VW is currently examining an IPO for Porsche AG. One wonders whether a decision can be made at all beforehand.

Red Bull and Porsche: That would be a dream combination.There are always talks, but Red Bull says they want to concentrate fully on the 2022 car at the moment. And on setting up our own engine department. Red Bull Powertrains has already hired over 200 employees. The target is around 250. For the production of your own engine from 2026, you would have to hire more staff.

Porsche only as branding?

A merger would certainly be attractive for Porsche for cost and efficiency reasons. Red Bull has already purchased six test benches from the specialists at Graz-based AVL. There are also single-cylinder devices. A first engine is scheduled to be put to the test in Milton Keynes before the end of 2022. The tools need to be calibrated.

Red Bull is not touching the V6 turbo for the 2022 season. You continue to buy it from Honda in Japan. This gives the engineers the freedom to fully devote themselves to the new project. So Red Bull hopes to be classified as a new manufacturer in 2026 in order to be granted more budget and test bench runs. The competition sees it suspiciously.

Red Bull is taking the development of the car and engine into its own hands. You make yourself independent. Milton Keynes might like that. There are quite a few who therefore believe that a merger with Porsche is more likely to result in some kind of sponsorship. With an additional flow of know-how - for example on the electrical side of the drive train.


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