- Andretti entry rumoured to be on the verge of FIA approval
- 11th team would need both F1 and majority of grid approval
- Brown suggests US$700m anti-dilution fee would be fair
McLaren chief executive Zak Brown has said the widely reported Andretti entry to Formula One would add value, rather than diluting the grid.
Despite vocal opposition from those within Formula One, namely the series’ chief executive Stefano Domenicali, Andretti’s entry is rumoured to be on the verge of being approved by the International Automobile Federation (FIA).
The recently renamed Andretti Global still has many hurdles to clear, as both Formula One itself and the majority of teams would have to approve the bid, but McLaren’s Brown has moved to support the entry under the right conditions.
“[A potential entry] has to be the right team with the right resources,” he told Motorsport.com. “Let's assume for a moment it is. If they pay the right franchise fee - which is not US$200 million, let's say it's US$700 million - then I get US$70 million.
“The dilution of an 11th team is about US$10 million a year. So, if I get US$70 [million], it will be covering me for seven years. Then if it costs US$700 [million] just to enter, it's created US$700 million more in franchise value. So, whatever I'm worth today, pick a number... US$2 billion, now I'm worth US$2.7 billion.”
Brown has been among a minority in support of Andretti’s entry from the beginning, having offered his signature to Michael Andretti in support at the Miami Grand Prix in 2022.
With General Motors alongside Andretti, the bid appears too good for Formula One to turn down, even if the full extent of General Motors’ involvement is fully understood. Although, even as a marketing exercise, its presence will be beneficial.
“The teams get 70 per cent of the money that comes into the sport. If General Motors comes in and they spend circuit advertising, sponsor a race, let's say they spend some Paddock Club, they spend US$100 million a year, we get US$70 [million] of that,” Brown explained.
The sticking point now is the anti-dilution fee, which Brown believes should be as high as US$700 million. In the current Concorde Agreement – the contract under which all Formula One teams agree to race in the series – there is a US$200 million entry fee.
However, this contract was signed in 2020, meaning the terms do not reflect the now-inflated values of Formula One teams following the sport’s explosion in popularity. Forbes estimated the average value of a team has increased 276 per cent to US$1.88 billion.
The next Concorde Agreement will need to cover 2026 and beyond, the year in which any new teams are expected to join the grid. Once a new anti-dilution fee is decided upon, the ten Formula One teams may be more malleable in discussions around expanding the grid.