Formula 1 approves minor increase on budget cap

2021 formula 1 carsFormula 1 approved a small increase to its $140-Million per team annual budget cap on Friday to help with the burden of inflation and rising energy and freight bills.

The change was announced by the governing FIA after a meeting of the Formula 1 commission at the Austrian Grand Prix and was approved by the required majority and nine of the 10 teams.

“Rapidly increasing inflation rates since the end of 2021 have affected Formula One teams, and it is the opinion of the FIA and Formula One that this creates a risk of noncompliance with the financial regulations if actions are not taken,” the governing body said.

The governing body’s proposal allowed for “indexation at a limited rate of 3.1%”.

This takes into account an original 3% inflation threshold already in the regulations and allowing compounding from 2023, it added.

“This will preserve the long-term integrity of the financial regulations,” it said.

The commission also decided by majority vote to allow pre-season testing outside of Europe next year, four days prior to the first event. The current rules stipulate testing in Europe unless agreed by a majority of teams.

There was also a discussion about a draft technical directive addressing safety concerns following cars ‘porpoising’, or bouncing, in the early part of the season.

The commission decided to delay implementation of the directive until the Belgian Grand Prix on Aug. 28 to allow teams time to make the necessary updates to the under-car plank and skid assemblies.

“Several proposed actions to address this issue in the 2023 technical regulations were also discussed, with clear directions to be taken to the technical advisory committee,” the statement added.

The commission confirmed that the 2026 power unit regulations were close to being finalised. (Reporting by Alan Baldwin)