The rising costs of life in the fast lane

IT was the $100 coat-hangers that rankled most, a rental charge that threw into high relief the captive and contrary world of F1.

Mark Webber, ahead of last weekend's Korean Formula One Grand Prix. Picture: Getty Images

IT was the $100 coat-hangers that rankled most, a rental charge that threw into high relief the captive and contrary world of Formula One.

While the sport's biggest shareholder rakes in billions of dollars, this weekend teams will face a charge to go racing, from somewhere to hang their branded jackets, to the fridge in which they keep the milk.

It is a little-known fact that F1's 11 teams have to pay race promoters for their hospitality suites, down to the hire of cutlery and even coat-hangers, which angered one team manager to the point of fury.

Figures seen by The Times show that teams face an average charge of almost $318,000 just to go racing at each of the 12 “flyaway” events from Brazil to Japan.

That equates to $3 million a race on average collected from the 11 teams by circuits desperately trying to offset the fees - ranging up to $42 million annually - that are charged by Bernie Ecclestone's F1 business to stage a race.

One source said: “We are effectively paying a tax on racing. The promoters have to make their money somewhere and they make it from the teams.

“It is like a football team turning up at Old Trafford for a match against Manchester United and discovering they have to pay for the changing rooms, the hot water and the soap. It is just another cost that the big teams probably don't notice but is a major factor in the budget of the smaller teams in the sport.”

One team said that they were asked for almost $15,000 to hire three forklift trucks to move around their boxes and pallets at one race.

“It would have been cheaper to buy one and drive it into the river when we were finished,” he said.

At another race, the hire of a fridge was equivalent to $2000 for the weekend. One team simply refused the offer of a set of coat-hangers that would cost cents in a shop, for more than $100.

Team managers wish to remain anonymous for fear of being targeted in the continuing war that divides the haves and the have-nots in the F1 paddock.

While CVC Capital Partners, effectively the owner of Formula One, and the four biggest teams - Red Bull, Ferrari, McLaren and Mercedes - are set to get richer, the struggle grows tougher for the smaller operations.

The unrest among the latter group - some of whom make no secret of their financial difficulties - comes against a background of incredible payouts to CVC. Accounts show that the company based in London's Strand, which bought F1 for $1 billion in 2006, will take a dividend this year of $920 million after earning $2.2 billion from selling down its shares stake to 35.5 per cent.

The money paid out to the teams has gone up to more than $790 million but the new commercial deal fixed with Ecclestone, F1's chief executive, is thought to give the biggest four teams 60 per cent of the total payout.

According to Martin Whitmarsh, the team principal at McLaren and one of the most vocal and intelligent critics of F1's financial structure, the cost crisis could mean the loss of well-known and respected teams who cannot compete.

One example is the new rules for in-season testing next year. Small teams are already weighing up whether they can afford the $530,000-a-day cost of running a car at a circuit as far away as Bahrain. Force India have already indicated they may miss some sessions “We have put together calculations that estimate $8.5 million for us to attend the four tests,” Andy Stevenson, the Force India sporting director, said.

F1 is a sport divided, and often by the small things that add up to a season-long grind of expense, from the fridge rental at ten times the cost of buying one in a shop to the world's most expensive coat-hangers.

The Times