Michael Andretti has suffered a massive blow in his pursuit of having an F1 team on the grid as Formula 1’s commercial rights holder has denied them entry. Although the FIA had given the American outfit the approval to join the grid last year, they still needed approval from Formula One Management (FOM). It seems that the FOM has now sided with the inhibitions of the current 10 teams in preventing an eleventh side from joining the grid.
Michael Andretti for long has called the rest of the teams “greedy” for their unwillingness to accept his side’s bid to join the grid. Here is a look at how much of the 61-year-old’s claims are true, and answers to some other frequently asked questions about Andretti‘s bid.
Why has Andretti been denied F1 entry?
Michael Andretti’s claims do indeed seem to be true as most of the leaders of the current 10 F1 teams have acknowledged that they are not keen to divide the pie with an eleventh side. The likes of Williams team principal James Vowles and former Haas leader Guenther Steiner had explained their strong inhibitions of why they did not want an eleventh team to join the grid.
As quoted by formulapassion.it, Steiner said, “With multiple teams, if something goes wrong, the risk of failure is higher. If something like the pandemic were to happen again, we must be as strong as possible”.
Similarly to Steiner, Vowles also explained how the current 10 F1 teams had worked incredibly hard to improve their side’s economic situation. Hence, the 44-year-old believes that they are not keen to run the risk of suffering losses again if an eleventh team joins the grid in the future.
Who is in favor of Andretti joining the grid?
Although most F1 teams were against Andretti joining the grid, McLaren was not one of them. McLaren CEO Zak Brown explained in an interview last year why he believes that the addition of Andretti could, in fact, be beneficial for F1 and all the existing 10 teams with the possibility of the sport having an increase in revenue via “better television contracts,” for example. While speaking on the Track Limits podcast (as quoted by planetf1.com), Brown said,
“My view is as long as it’s (Andretti’s entry) additive to the sport – brings in more fans, brings in more revenue, brings in better television contracts, whatever that may be – if it makes the pie larger I’d rather have one 11th of a pie that’s 1,000 times than one-tenth of one that’s 100 times“.
The only concern that Brown has with Andretti‘s entry is that he has a lack of clarity about the situation. The American stated that since it is only the Formula One Management and the FIA who are informed about Andretti’s proposal, people like him do not have enough information to suggest whether the American outfit’s entry would be beneficial to F1 or not.
How much money is Andretti investing to be within F1?
The primary concern with Andretti joining the grid has been that the price money pie will be divided between 11 teams instead of 10. As a result, F1, as per the Concorde Agreement, have something called an anti-dilution fee that all prospective new teams have to pay if they are to join the sport.
As per the Concorde Agreement that was signed in 2021, Andretti needs to pay an anti-dilution fee of $200,000,000 ($20,000,000 to each of the 10 teams) if they are to join the grid. Although the American outfit was willing to pay this fee, the FOM has rejected their bid to join the grid.
Although the figures are not clear about how much Andretti wanted to invest for their own side, Mercedes team principal Toto Wolff believes that for any new team to be successful, they would perhaps need to invest a whopping $1 billion at the least. The Austrian stated that if Andretti were willing to invest such a huge amount, then he saw no reason why they could not join the grid.
Has Andretti opened a factory?
Many will view the decision of F1’s commercial rights holder as a shame as Andretti seemed very serious about joining F1. Last year in August, they revealed that they had plans to open a state-of-the-art headquarters in Fishers, Indiana.
The 90-acre factory costs $200 million and will be operational by 2025. In their statement, Andretti revealed that the new headquarters will not only serve their current teams across different racing categories but also any “future racing initiatives“.
Can Andretti take legal action against F1?
Since Andretti have had their bid rejected, the next obvious question is whether they can and will they take legal action against F1. F1 business expert Mark Gallagher believes that the American outfit can indeed take legal action against Formula One Management (FOM).
As quoted by thejudge13.com, Gallagher said, “My fear is that if Formula 1 rejects Andretti – they’ll come up with all the reasons why they don’t want to have it – I think we could see a lawsuit develop pretty quickly because Liberty’s an American company. Formula 1 is listed on the New York Stock Exchange“.
Gallagher believes that since General Motors is also an American company, there is all the more reason why Andretti can launch a legal battle against the FOM. Another concern that the FOM may need to answer is that as per FIA’s regulations, up to 12 teams can compete in F1. However, there have been two vacant slots for some time now.
