After the last European race of the 2023 F1 season, the FIA, Formula One’s governing body, announced that all ten teams had remained in compliance with the 2022 F1 cost cap regulations.
Introduced in 2021, the cost cap is a revolutionary measure to control team expenses.
The original proposal was to set a maximum amount of $175m for the first year, but the COVID-19 pandemic forced the sport to lower the financial ceiling to $145m.
For the 2022 and 2023 seasons, Formula One aimed to reduce the amount by $5m per season, meaning that the teams had to complete the current season with a budget of $135m.
The cost cap is applicable to most salaries, car development costs, and race weekends, including transport, but does not apply to the cost of buying an engine for customer teams or developing a power unit for factory teams.
The cost cap has excluded other expenses, including driver salaries, the wages of the three highest-paid staff members, marketing expenses, property and legal costs, entry and license fees, parental and sick leave payments, and employee bonuses.
Last year, during the 2022 season, the FIA found Red Bull guilty of a “minor” overspend of the 2021 $145m budget while Verstappen was wrapping up the championship.
Red Bull received a $7m fine plus a 10% reduction to their wind tunnel time for this season as a result of the $2.2m overspend.
The FIA has now confirmed that all the grid’s ten teams have been awarded compliance certificates after sticking to last season’s budget cap.
In 2021, the FIA found that world champions Red Bull exceeded the limit by £1.86m, while Aston Martin and Williams were found of procedural breaches.
Red Bull received a $7m fine and a 10% reduction in permitted aerodynamic research for a year as a result of their transgression.
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There were concerns that teams might hide their expenditures on F1 by claiming it was money used by other parts of the business.
Many of the teams have applied technologies businesses that work in other fields or are part of a wider group such as a car manufacturer.
However, an FIA spokesperson said that they had conducted a “deep dive” into all non-F1 facilities, including visits to team bases by the cost cap administration team and extensive and proactive inquiries, and that anything contentious had been checked and rechecked.
The spokesperson also added that no team had availed themselves of either the mechanism that exists to lodge a formal complaint about a competitor or had activated the anonymous whistle-blower process.
The cost-cap administration team has approximately doubled in size since last year, according to the FIA.
The cost cap process is part of a series of regulations aimed at closing up the field over several years.
The system of aerodynamic testing restrictions (ATR) is another rule with the same aim, which, on a sliding scale from top to bottom, gives the most successful team the least amount of wind tunnel and computational fluid dynamics time and the least successful team the most.
The values are changed every six months according to championship position.
Despite their punishment and ATR limitations, Red Bull has dominated this season, winning every race so far.
