Ferrari and McLaren sign new F1 Concorde agreement, what purpose does it fulfil in the sport and are what are the implications of it?
The new Concorde agreement proposed by Formula 1 has been signed by Ferrari and McLaren- the first two teams to do so as per the SkySports.
The agreement will determine how F1 will be governed and importantly, how the prize money and revenue will be split between the teams participating in Formula 1.
With the current Concorde agreement expiring this year, the F1 bosses have been working on a new vision for the sport with a more equitable share of revenue in order to make the grid more competitive and sustainable.
The current deal obligates Formula 1 to give Williams, Mercedes and Red Bull bonus payments of varying amounts, whilst Ferrari receives a $75 million ‘long-standing team’ bonus to reflect its historical importance to the sport.
It is reported that the new deal will alter such provision, though Ferrari will still receive some of its bonuses, it will be reduced. Additionally, other teams are expected to do the same in the coming days.
— Rachel Brookes (@RachelBrookesTV) August 18, 2020
Ferrari and Mercedes on Concorde Agreement
Both the teams have remained positive about the agreement and have mentioned that the new agreement will improve Formula 1 for all the parties.
“We are pleased to have signed up again to what is commonly known as the Concorde Agreement, which will regulate Formula 1 for the next five years,” said Louis Camilleri, Ferrari’s chief executive officer.
“Racing is in Ferrari’s DNA and it is no coincidence that the Scuderia is the only team that has participated in every edition of the FIA Formula One World Championship, becoming an integral and essential part of its success, today as in the past and, above all, in the future.”
Announcing their signatory to the new document a little earlier in the day, McLaren chief executive Zak Brown said: “Formula 1 has taken another important stride on the road to a sustainable, strong future with the new agreement. This is the right deal at the right time for the sport, its owners, its teams and, most of all, the fans.
“A more equitable sport is better for everyone: greater balance in the sharing of revenues among all the teams and clearer, simpler governance that cuts through vested interests and puts the sport first.
“This agreement will only make the F1 constructors collectively stronger in the long term. “The new agreement complements and builds on the great work of F1, the FIA and all the teams during the past few months on the future financial, technical and sporting regulations.
“Everyone has had to give ground for the bigger outcome, which will be a more competitive, exciting and thriving Formula 1 for future generations, which in turn secures a healthy sport for both participants and fans alike.”