- Credit: Red Bull Content Pool

Horner, Binotto discuss 'soft landing' in preparation for drastic budget cap

Ferrari, Red Bull discuss the 'soft landing' mechanism to give lenience to larger teams who need restructuring as they prepare for the budget cap.

4w ago

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In theory, the implementation of a budget cap in F1 is a simple process, only demanding a few extra lines in the sporting regulations for the upcoming season. However, like most things, it's far more difficult in practice.

Political roadblock will naturally obstruct any efforts to implement such a change, and if one were being cynical, they might suggest that such conflicting interests among F1 teams would make an agreement impossible. Nonetheless, in their process of doing exactly this, the FIA made it past this.

The teams and the governing body ultimately reached a compromise, putting the regulation in the 2021 rulebooks. However, more trouble laid ahead. As the COVID-19 pandemic took hold of the world, the subsequent financial recession forced more dramatic lowering of the maximum budget.

This then posed a new challenge, as the further cuts meant that some of the larger teams - like Mercedes, Red Bull and Ferrari - would have to make changes to staff, be that a reallocation of employees, or a mass-layoff.

Ferrari were one of a few to raise concerns about this particular issue, suggesting that they might have to explore options like IndyCar or WEC to make use of excess staff members. To account for such a transition, the FIA decided to factor in a grace period for teams to go through this process, where have until June 2021 to sort the changes.

"Obviously as Ferrari when we have been discussing the reduction on budget cap we have been very vocal on the fact that the new number, the new budget cap, would have meant a lot of reduction in terms of team organisations and members," started Binotto.

"We said we felt a social responsibility very strongly and we felt that it was somehow a wrong move towards the people, because it being such a period – pandemic, COVID – people losing their jobs was wrong. So what we simply asked was a soft landing - it has been ourselves to ask it and to obtain it – was a soft landing mechanism where we had time as a company to reallocate people in other jobs within our company.

"Simply that gave us six months’ time – I have to be honest, we asked for a bit more but that was the compromise – we’ve got six months’ time by the end of the year to reallocate people in different jobs," added Binotto.

Meanwhile, Red Bull boss Horner alluded to a similar reallocation of staff members, as his team shed some employees in their F1 operation. The Brit, in fact, hinted that new programmes may be added, the announcements of which may come in due time.

"I think the mechanism you’re talking about was primarily to accommodate Ferrari, in particular, with their employment laws but I think what we’re seeing as we inevitably delve deeper in these regulations and of course they have a much bigger effect on the top three teams than they will for the teams that are already operating below the cap but what’s been exciting for us is to look at projects that will soon be announced that we’ve won with external clients where we will be taking on different work and different work streams in different categories," stated Horner.

"We have obviously designed the Valkyrie car over the last four years and we’re looking at other options where we can utilise the skill set and talent that we’ve acquired in F1 in other projects. Obviously those regulations do have a fundamental impact on the teams and of course that cushion, as it were, for 2021 does offer a soft landing, particularly for Ferrari who pushed so hard for it," summed up Horner.

Certain reports - especially by Sky Sports F1 - talked about transfer of personnel from Mercedes to Racing Point (to-be Aston Martin), who are expanding their programme and will need people. Something of that may happen between Ferrari and Alfa Romeo too, considering that Frederic Vasseur hinted at a reformed alliance between the two outfits.

[This story was written by me for FormulaRapida, and edited by Darshan Chokhani]

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