One of the great paradoxes of Formula 1 is that because of the introduction of so-called cost cutting measures designed to keep teams from ‘buying success’ through massive spending on research, the rules are in actuality creating an environment where only the richest teams can compete.

In its infancy, F1 was ruled by ‘Grandee’ teams like Alfa Romeo and Maserati who were also car manufacturers. These grandees were initially the only ones who had the resources to build race cars but within a decade they were facing strong competition from small, specialty companies who would build a few race cars and compete for prize money. Enzo Ferrari scornfully called these teams, ‘Garagistas.’

From the early sixties until the turn of the century, ‘Garagistas’ like Cooper, Lotus, Tyrrell, and McLaren (before the Mercedes partnership) were the kings of F1, staying one step ahead of the Grandees by adapting new technology into their cars. Because the technology was cheap and available, nearly anyone could participate and be successful. So successful that Ferrari, the longest competing ‘Grandee’ of them all, failed to win a World Championship for 21 years before the pendulum started to swing back.

The reemergence of the grandees like Honda, Renault, BMW, Toyota Mercedes (via McLaren) and Ferrari at the top of the sport has coincided directly with the introduction of the cost cutting rules that dictate the type of engine, transmission, tires and electronics that can be used in F1.

This standardization has created the perfect environment for the grandees to compete in. Because there are so few areas where teams can introduce new innovations (something the Garagistas excelled at) the manufacturers have found an advantage in exploiting small performance gains found only by exhaustively refining their static designs. This process can cost millions of dollars per tenth of a second of performance – millions the independents don’t have.

For those fans that admire the drive and passion of the independent teams of F1, these are dark days in the shadow of the Grandees. The last best hope for survival of the Garagistas doesn’t lie in cost-cutting but in throwing out the design rules altogether.

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Max Mosley has seen the light…or jumped on the budget capping bandwagon. In either case it looks like F1 is going to follow other major league sports by trying to manage how much teams can spend to win. No specific details have been released but according to Autosport.com it is known that engine costs, marketing and promotion and team principle salaries will not be part of the cap.

The F1 fraternity has 1-2 years to work out the system but you can believe that the devil will be in the details. F1 teams are notorious for finding loopholes in technical regulations and they will no doubt expend huge amounts of money and energy looking for ways around the budget cap. Its just in their nature.

Interestingly, Ferrari initially opposed the idea of budget caps and may still be against the idea. They were in favor of other cost saving initiatives like capping the number of wind tunnels a team could have. Ferrari are the only front running team with just one wind tunnel while Williams, Honda and McLaren all have two. Convincing the Italian marque to change its position could not have been easy and its possible that concessions needed to be made to get them to agree to a cap -or still need to be made.

An early suspicion is that driver salaries will quickly fall under the ‘marketing and promotions’ umbrella and be exempt from the cap. Its easy to imagine Kimi Raikkonen or Lewis Hamilton being paid a pittance to drive but millions to be in ads, to wear team logos and to attend sponsor events.

Its too soon to say how serious Formula 1 is about a budget cap but like the ‘green’ movement, there is a lot of political mileage in the idea. Getting rid of the perception that F1 is about how much money you spend can only be a good thing for the sport’s image.

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