Ferrari to keep ‘revised’ bonus F1 payment in next Concorde Agreement

• Ferrari currently benefits from extra income due to historical significance to F1
• Legacy payment can currently rise to a maximum of 10% of F1 revenue

The Ferrari Formula One team are set to keep their historic bonus payment in Formula One’s next Concorde Agreement, but at a reduced rate, according to Motorsport.com.

The current Concorde Agreement – the commercial contract under which the teams agree on the prize structure and how revenues are divided – contains a clause that provides Ferrari with extra funds due to their historic significance to the series.

Under the current terms, Ferrari receives five per cent of the entire prize fund, but this is only if the total prize pot does not exceed US$1.1 billion. Motorsport.com reports this percentage can rise to ten per cent for anything above US$1.6 billion, which is believed to be where the series’ revenues currently sit.

The new proposal is for the bonus payment to be capped at five per cent, which would still provide the historic Italian team with a sizeable chunk of income.

Overall, teams receive 50 per cent of Formula One’s profits, but this can be reduced if the series generates more than a certain amount of income. According to Motorsport.com, with revenues in excess of US$3 billion last season, Formula One currently pays the teams around 45 per cent.

There is plenty of debate as to whether Ferrari’s bonus payment is fit for purpose in the modern era of Formula One, but Williams boss James Vowles agrees with its existence.

“I think Ferrari brings something special to the sport,” he said. “We have to be honest about that.

“If you ask an average person who they know in Formula One, you will see that Ferrari is still a name that stands out.

“That’s the truth behind it. They bring a certain level of heritage and recognition to the sport. So I think there’s a reason these things exist.”

BlackBook says…

Ferrari are the most recognisable – and most valuable – team in Formula One, so the legacy payment makes sense even if it goes against the spirit of the budget cap.

This is just one sticking point to be decided for the next Concorde Agreement, which will also outline the new entry fee for prospective teams.

Currently at US$200 million, expect this number to be at least tripled by the time a final sum is agreed upon, which will likely be the point at which Formula One’s stance towards Andretti softens.