Why F1 faces “game over” risk on cost cap D-day

After months of analysis and a number of delays, the FIA is finally due to announce the results of its audit into F1 teams’ finances for the 2021 world championship.

This moment will define whether or not they each complied with the circa $145 million budget cap limit that was in place.

Those given the okay will get their certificates of compliance. Any that didn’t risk a cost cap hearing and penalties.

But rather than this be just a standard procedural moment, the paddock whispers in Singapore that two teams may have breached the rules have left the sport on tenterhooks for what could be a hugely significant announcement.

With the cost cap having been a core component of F1’s plans to deliver a closer grid over the long haul by levelling out spending between all competitors, the FIA faces a hugely difficult balancing act in dealing with potential problems.

Go down hard on teams that have exceeded the limits for what are incredibly new rules, and it risks causing huge controversy over a 2021 campaign that still remains a sore topic for many.

But brush any potential breaches under the carpet by letting them go, or hand down too weak a penalty on any rule breakers, and it risks opening the flood gates in making other teams feel that overspending is not something they really need to worry about.

It is no surprise that Ferrari was so open in Singapore last weekend about just how important a moment this is for F1’s cost cap era.

Racing director Laurent Mekies said: “It is a very vital test for the cost cap. And if we don’t pass that test, it’s probably game over, because the implications are huge.”

Charles Leclerc, Ferrari F1-75, George Russell, Mercedes W13

Photo by: Mark Sutton / Motorsport Images

What has left top teams like Mercedes and Ferrari so up in arms over potential overspending by others is that they know how much performance is being left on the table by them rigorously sticking to the cost cap limit.

Their fear is that if other teams have found ways to get around spending limits but stay with the letter of the law, or are happy to overspend and just take sanctions on the chin, then they will be forced to change tact.

Red Bull submission

Despite all the spotlight in Singapore being on Red Bull, and suspicions that its upgrade spending has been out of kilter with others, team boss Christian Horner was clear that its 2021 submission was below the limit.

In fact, insiders have suggested that its audited accounts were several million dollars below the $145m limit, and have not been impacted by spending clarifications that the FIA has issued in recent months as it has gone through each team’s audits.

“It is significantly below,” said team boss Christian Horner. “With the clarifications, we should be even further below….”

The final judgement is of course the FIA’s, just as the tax authorities may not always agree with an individual’s own self-assessment.

Only the FIA can decide the fair value of…