FEBRUARY 25, 2003
Max Mosley's letter
Your letter of 20 February in response to mine of 7 February is very disappointing. My letter contained carefully thought-through proposals to resolve our Championship's two biggest problems: how to accommodate the major car companies for as long as they wish to remain in Formula One without risking its collapse when they withdraw, and how to encourage new independent teams into Formula One while preserving those we already have.
Your response is unfocused. It wanders through the measures announced on 15 January and touches on my letter of 7 February, confusing the two. It makes no attempt to say which, if any, of the January measures you agree with or why you think the Concorde Agreement prevents the FIA enforcing its rules in this way.
As an example of your failure to engage, you say you "believe" the engine suppliers do not support a multi-race engine, but you make no attempt to present a case against this or against any of the other proposals to which you say you object. Nor do you make any alternative proposals, except to mention the Mercedes Û10 million offer, which Mercedes themselves admit has only become possible as a result of the 2004 single-engine rule which you Frank, and you Ron, fought so hard to reject. Otherwise you seem to be saying there are no problems.
It is impossible to have a dialogue if the response to a carefully considered set of proposals is a collection of vague claims and confused criticisms with no discernable attempt to address the arguments. Nevertheless, I will try to extract the main points from your letter and reply to them. However, I repeat, the points in my letter of 7 February remain unanswered and still require discussion.
The FIA is in breach of contract
I am not sure why you think this. I have already asked your solicitors whether you contend that all the 2003 measures are breaches of the Concorde Agreement and/or European law and if not, which ones you accept. I have also asked them to explain in respect of each contested measure why you consider it to be a breach of the Concorde Agreement and/or contrary to European law, and in respect of the proposed rule changes for 2004, 2005 and 2006, why you contend that we are not following the procedures laid down in the Concorde Agreement, having regard to our stated intention to seek the agreement of the Formula One Commission to each of these changes. Your solicitors have refused to answer. Perhaps you could instead?
Formula One produces more than enough profits to sustain all the teams and the FIA should seek more equitable distribution of TV, etc, income
Prost and Arrows have gone into receivership in the last twelve months. At least two more teams are in danger. These facts speak for themselves. Even if the entire FOM income were distributed among the teams, current cost levels would be unsustainable. Moreover, you both freely agreed to the existing system in 1998, locking yourselves in with FOM for ten whole years instead of the customary five. I have never understood why you did this. When you signed in 1998 you knew every detail of Formula One finance as a result of Bernie's attempt at flotation in 1997. It is difficult to see how you can expect the FIA now to undo what you agreed to then.
Since at least 1997, the FIA has consistently suggested that the smaller teams should get most of the Formula One TV and race income to make up for their lack of sponsorship. You have both always vehemently insisted that income should depend on success.
The FIA is trying to dumb down the sport
If you truly believe that the public want to see computer-controlled cars guided from the pits by anonymous engineers, please think again. If you don't believe me, hire two halls in any city anywhere in the world and put, for example, Michael Schumacher, Kimi Raikkonen and Juan-Pablo Montoya in one, with both of you plus your electronics experts and your technical chiefs in the other. Invite the public to both halls and see what happens. The FIA Formula One World Championship is primarily a drivers' championship and always has been. If you want an example of a championship which put technology ahead of drivers, have a look at the history of Group C. Despite the presence of very high-tech Jaguar and Mercedes Benz racing cars, it drew smaller crowds than local touring car championships even in the UK and Germany. TV coverage was negligible for the same reason. The public are interested in drivers and sport, not electronics.
The FIA is taking an unnecessarily pessimistic view
This is exactly what you hear from the old guard in a failing company. You would not find any independent observer or serious businessman who would agree with you.
The FIA's proposals are hostile to the manufacturers who will consistently support Formula One and are determined to further grow (sic) the sport
You are ignoring history as well as business reality. Both your engine suppliers (BMW and Mercedes) have been in and out of Formula One and other branches of motor sport over and over again. The fact that they say they would like to invest in Formula One does not change that. They are answerable to their shareholders, not to the sport. They can, and will, leave whenever it suits them. This is not a criticism, it is a statement of fact
You must remember that a car manufacturer is not spending its shareholders' money to support motor sport, it is spending it to win and sell more product. We are currently seeing a money spending contest with one manufacturer (and it's not Ferrari) employing upwards of 1000 people and virtually unlimited resources in an attempt to win the FIA Formula One World Championship. There is nothing wrong with that, the rules certainly do not prohibit it, but we cannot prevent that same manufacturer stopping tomorrow if, for example, its shareholders stage a revolt. In trying to make sure that Formula One can continue irrespective of the number of major manufacturers involved we are not being hostile, merely realistic.
The manufacturers contribute a lot and we must continue to do all we can to encourage them to stay. But we must never be so naive as to believe we can rely on them. Never forget that the top executive is an employee. He could be out of a job next week. This has already happened to three of the top executives in GPWC in less than two years. His replacement might hate motor sport. It would be folly to allow Formula One to be at the mercy of personnel and policy changes in the major manufacturers.
You could only rely on a manufacturer if it (the main company, not a subsidiary) would enter into a legally binding commitment to participate in the Championship for at least ten years and give at least three years' notice before stopping. So far, none of them appears likely to do this.
It is unsafe to cut race preparation time to 2.5 hours and to race without telemetry
You are saying that after less than 150 km of free practice on Saturday morning your cars cannot safely race for 300 km without an 18 hour overhaul. This is obvious nonsense. We have all seen cars completely rebuilt in less than two hours after a major accident. Yours is a really threadbare argument, particularly when you look at the rest of motor sport and remember that the real race preparation takes place in the two weeks between races.
You don't need telemetry if you fit a warning light to tell the driver to stop if something is wrong and you have a whole year in which to do this.
On 4 December the teams agreed a range of measures to reduce costs in 2003 and to supply low-cost engines
The bit about engines is quite simply untrue. Engines are not mentioned in the "Summary of points agreed between the Team Principal's (sic) in their meeting on 4 December" issued by McLaren. Nor do the proposals relate to 2003. According to the McLaren summary, the only agreement reached was a list of items which should not be changed between qualifying and the race. The list was inadequate because it omitted, among many other items, braking systems, wheels, suspension, bodywork and ballast.
Apart from that to fit a standard skid block in 2004;
- "in principle" to "seek to agree" standard telemetry for 2004;
- "in principle" that high-density ballast "could be" eliminated in 2005;
- "in principle" to "give serious consideration" to a standard wheel (no date);
- to reduce weight in 2005 "provided" this was part of an (as yet undefined) package of proposals;
- that a package of cosmetic changes to bodywork (for more advertising space) "should be agreed" for 2004 - to give "consideration" prohibiting refuelling in 2005;
all of which were additionally "subject to the acceptance of detailed changes".
No wonder one of the team principals said the proposals had not saved enough to pay for the sandwiches. To claim that this sad little list of conditional intentions
". . . would without doubt have considerably reduced costs and fully enhanced the spectacle of Formula One", as did GPWC in its press release of 17 January, verges on the laughable.
McLaren and Williams have been proactive in helping the smaller teams with current financial difficulties
Your main "proactive" work in the past twelve months seems to have been to try to prevent at all costs (including taking Bernie to arbitration) Minardi receiving money which I and at least two leading counsel believe is clearly due to them. This was money which would have gone to Prost had he continued, never to either of you, yet you are apparently doing your utmost to grab it at Minardi's expense. Furthermore, Ron's public utterances on Minardi speak for themselves.
I note you seek credit for the Mercedes engine offer yet, as Mercedes themselves confirm in their letter of 14 January 2003, this has only become possible because of the single-engine rule in 2004 - the rule you both did your utmost to prevent. Incidentally, you describe the Mercedes engine as "low-cost". At Û625,000 (over £400,000) per race, this gives a whole new meaning to the phrase. The rumour that Jordan may be having to pay nearly Û20 million in 2003 does not make Û10 million "low cost".
The FIA has not "embraced" the manufacturers' offer to contribute to the sport.
We believe GPWC are negotiating in a desultory way with Bernie and the Kirch banks, but we have not yet been consulted about this.
Nevertheless we have done everything we could to encourage the manufacturers. I have yet to meet the CEO of a major car company (as opposed to a number two or three) who does not support the FIA or who thinks the manufacturers should make the rules. Any of the top men would laugh at your suggestion that the FIA is "driving the automotive (sic) manufacturers out of the series".
More generally, a word about your conduct on 20 February. You both knew perfectly well that, at least until 15 January, there was great unease among sponsors, television networks and race promoters about Formula One. You must also have known that to announce your intention to go to arbitration would add to this unease and revive all the worries of the winter break. Yet, having instructed solicitors to write to us on 20 February saying that arbitration proceedings would commence unless we agreed to compromise by 26 February, you went to the world's media on 20 February without waiting for a response, indeed before we had even had the letter. How irresponsible. You waited five weeks after the 15 January meeting without reacting or seeking a meeting. Could you not have waited another six days for our response to your solicitors' letter before once again destabilising the FIA Formula One World Championship?
Finally, in your public pronouncements, if not in your letter, you have accused me of acting in a dictatorial fashion and without proper consultation. I must remind you that after the Formula One Commission meeting of 28 October, a meeting between the teams (including the teams' technical directors) and the FIA was planned for 4 December. Charlie Whiting even cancelled the meeting of the Technical Working Group, which had long been scheduled for 6 December, to avoid duplication. We then booked a room for the meeting. Then, to our astonishment you suddenly insisted the FIA should not be present and arranged a meeting elsewhere, leaving us with the cost of our room.
You would not meet us. You would not yourselves agree anything significant. What were we supposed to do? No-one wants to implement measures, however necessary, without full discussion, but what else could we do? By contrast there has been endless discussion with the teams since 15 January and we have done and continue to do all we can to help and co-operate with the teams.
Plainly the best way to deal with the problems of the FIA Formula One World Championship would be to discuss new rules rather than the more rigorous implementation of existing ones. But we cannot do that if you refuse to meet us, as you did in December.
Paris, February 25, 2003