The increase in funding comes at a crucial time after two teams – Caterham and Marussia – went into administration at the end of last season and with several others currently facing a cash-flow crisis. F1 bosses have also offered an advance, which must be approved by all teams, to the most struggling outfits.
Although the start of the 2015 season is just days away, F1 company documents reveal that the teams only received the final instalment of their prize money for 2013 last week.
Team budgets come to an average of £150m annually and are largely fuelled by sponsorship and prize money. The teams get the former in the same year that the logos appear on their cars but the latter is paid in arrears.
Buried in F1 company documents is the revelation that “payments of the prize fund are made on the last business day in every month of the world championship season [March to November], with the final payment in respect of each year being made on the last business day of the following February.”
The 2013 prize fund came to a total of £518m and the last instalment is typically around 10 per cent of it, bringing Friday’s payment to an estimated £51.8m.
Half of the money is split equally between the top 10 with the remainder paid on a sliding scale based on race results. F1’s best performers – Ferrari, McLaren and Red Bull – get significantly more than their rivals, with the lowest payment of £1.3m going to Marussia.
Marussia is now known as Manor and is battling to be ready for Australia after exiting administration last month. The team has named Britain’s Will Stevens as one of its drivers and reportedly has investment from Stephen Fitzpatrick, boss of energy firm Ovo. Justin King, the former boss of Sainsbury’s, is set to be involved in the running of the team but is not an investor.
The bosses of its three main rivals, Sauber, Lotus and Force India, recently met with F1’s boss Bernie Ecclestone to warn him that they may not make it to the first race due to a cash-flow crisis. “We have had cash-flow issues, there is no question of that,” Force India’s deputy boss Bob Fernley said last week.
Force India’s 2015 car hit the track for the first time on Friday, just two days before the end of winter testing. Its start was delayed by suppliers demanding upfront payments after Caterham and Marussia’s difficulties.