An F1-designed submarine? Why GP teams are getting involved in bikes, boats & electric racers

Formula 1 teams are no longer just Formula 1 teams, with increasing sidelines in hypercars, submarines and electric racing projects. It's partly a creative reaction to the budget cap, writes Chris Medland

BMC bicycle in Red Bull F1 factory

Red Bull Advanced Technologies work includes a partnership with BMC bicycles

Red Bull

Whenever there has been talk about the budget cap – or financial regulations to use the official term – in Formula 1 recently, it has generally been a row between teams looking to increase the figure and those who don’t want to.

Inflation has squeezed some teams who were operating right up against the limit, but then those who don’t face the same issue are suggesting the easy answer is to spend less on car development to make savings.

While that row might soon get resolved with some sort of compromise offered up by Formula 1 and the FIA, there have been some other interesting developments in the past few days that show the impact of the budget cap in different ways.

The first of those was off the back of an announcement at McLaren that I attended on Monday. It wasn’t an F1 announcement (there will be a theme there), but instead it was the team renaming its Extreme E and Formula E outfits under the McLaren Electric Racing umbrella, and adding title sponsorship from Saudi Arabian region Neom for good measure.

McLaren 2023 Extreme E and Formula E car

McLaren will have two electric racing teams in 2023: its Extreme E outfit and the new Formula E squad

McLaren

Now I’m not going to get into the moral argument surrounding taking money from the Saudis at this stage, but it is a deal that is going to help boost the McLaren Racing coffers and allow them to pursue success in both categories while also having a chance of turning a profit in a spec series.

What is interesting from an F1 perspective, though, is how the limit on certain spend items under the financial regulations has played a part in the team’s expansion.

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It’s not that McLaren wasn’t already looking at different racing categories it wanted to be involved in – as CEO Zak Brown was always clear that he wanted to enter IndyCar and has also been considering the World Endurance Championship (WEC) alongside the likes of Extreme E and Formula E – but the reasoning was always if it didn’t distract from the F1 programme. Instead, there’s now a way it can help it.

There are limitations on what teams can spend from a capital expenditure (cap ex) point of view under F1’s budget cap, and so each investment made in facilities needs to be really worth it rather than just providing small gains. Or it could be spread across multiple projects…

“With some of the limitations you have on equipment and cap ex it’s hard to justify some items where it’s exclusively for one series,” Brown said on Monday. “So to be able to go ‘we are able to buy that and use it across three or four different series’ then that makes some of the cap ex more justifiable.

“But from a people standpoint we’ve already done all that work. We’re right-sized in Formula 1 now for the size of Formula 1, so there’s no crossover in that sense.”

Ferrari Hypercar teaser

Ferrari says its Le Mans Hypercar benefits from F1 knowledge — but not staff

Ferrari

Brown’s not alone in stating people aren’t moving, despite salaries making up a decent proportion of an F1 team’s budget now it is limited. Ferrari is working on a Hypercar entry for WEC but Antonello Coletta – the Head of Ferrari Attivita Sportive GT which runs the sports car programme – said at Le Mans there was no movement of personnel there either.

“[There’s been] no big recruitment because honestly I prefer to grow with a little number; if you grow a lot you lose the control of the staff,” Coletta said. “This is the philosophy of Ferrari. Honestly, we are not many many people, but just the people who work very well. It’s easier to control the process.

“Zero [have come from Ferrari’s F1 team] because our team is our team. We share knowledge but it is a completely different attitude.”

That’s not the case everywhere, though. A day after McLaren’s announcement, it was off to Milton Keynes to hear about a new Red Bull project. While Christian Horner and Adrian Newey sat among all of the team’s Formula 1 cars from the past, the creation of RB17 might carry F1 naming but is actually a track-going hypercar, the first that the company will make exclusively.

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Designed to be close to F1 performance and quicker than the Valkyrie that Red Bull partnered with Aston Martin on, the big step being made by Red Bull Advanced Technologies has been facilitated – or enforced depending on your point of view – by the impact of the budget cap on one of the sport’s biggest-spending teams.

And Horner admits, that in this case it has led to the movement of personnel away from the grand prix team.

“It’s interesting because our staff are our biggest asset, and of course with the advent of the financial regulations, whilst Advanced Technologies has existed since 2014 and has been growing and developing in its own right, what it has enabled us to do is to re-home staff that otherwise would have been lost to the business but that are incredibly capable,” Horner said.

“So it has enabled us to retain that talent within the group. I think it has enabled us to bring in new talent and develop talent as well. On the campus here … it’s not just purely centric to Formula 1. Obviously Formula 1 dominates what we do but out of that comes more and more other activities and with the advent of Powertrains coming online as well.

“And of course through these Advanced Technologies activities we’re doing a car; we’re working in collaboration with BMC on bikes; we’re heavily involved the Alinghi team in Americas Cup; we’re designing a submarine for up to three to four passengers; so we’ve got many different projects going on within Advanced Technology. So with that variance as well, being able to retain and attract talent has been incredibly important to us.”

It might be the bigger teams that have had to make changes when it comes to its staff numbers in some areas, but as F1 becomes more profitable and the revenues grow, income can be used in different areas on other money-making projects.

At £5m before VAT, the Red Bull RB17 is certainly designed to be that, but as McLaren has shown that could also be another racing category that can produce an added benefit to the F1 set-up.

It’s not a situation that requires immediate attention by all teams on the grid, but as the budget cap situation becomes more familiar we could well be moving further away from the era of an F1 team simply going racing in F1 and nothing else.