Mercedes set for crunch meeting to decide whether it will quit F1

2020 F1 season

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The board of Mercedes‘ parent company Daimler will meet in two weeks’ time to decide whether to withdraw its team from Formula 1 at the end of the 2020 season.

RaceFans, in a joint investigation with Autocar, has learned the meeting will take place on February 12th. Mercedes’ current contract to participate in F1 expires at the end of this season.

Mercedes’ departure would raise immediate questions over the future of its drivers, including reigning world champion Lewis Hamilton, and its chassis building operation in Brackley.

While Mercedes’ factory F1 programme has been extremely successful – the team has swept the drivers’ and constructors’ championships in each of the last six seasons – several signs point to a likely exit for the three-pointed star.

Mercedes’ parent company Daimler is under increasing pressure to make savings. Last year it announced a shortfall in profits of several billion pounds and a plan to lay off over 10,000 staff.

The company has spent billions on its F1 programme since reviving its factory F1 team 10 years ago. It has reaped the reward in terms of prize money and marketing while dominating the last six seasons, but the perceived extravagance of participating in F1 jars with the reality of extensive job cuts.

The departure of the team which has dominated F1 since 2014 would have a profound effect on the sport.

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The Mercedes-branded engine operation, based at Brixworth, is expected to continue its participation in F1, which stretches back to 1994. It already has contracts to supply power units to McLaren and Williams in 2021, the latter deal running until the 2025 season.

Valtteri Bottas, Mercedes, Shanghai International Circuit, 2019
Why should Mercedes continue in Formula 1?
It may also continue supplying power units to Racing Point and whoever assumes control of the former Mercedes team. However recent developments indicate these two may be closely linked.

Sources have suggested current Mercedes team principal Toto Wolff, a shareholder in the operation, could partner with Racing Point owner Lawrence Stroll, who last month was revealed to be considering an investment in Aston Martin. This would pave the way for the former Mercedes team to be rebranded as Aston Martin in 2021.

Daimler board members attended the season-ending Abu Dhabi Grand Prix at Yas Marina last year. Head of Mercedes-Benz cars marketing and sales Britta Seeger joined Hamilton on the podium after he scored the team’s 15th win of the 21-race season.

Hamilton’s destination in 2021 was already a focus of speculation before the new details on Mercedes’ situation came to light. A potential vacancy exists at Ferrari alongside Charles Leclerc next year. Should Mercedes pull the backing for its factory squad, it would increase the chance of a tie-up between the sport’s most famous current driver and its most historic team.

Aston Martin declined to comment on this story; Mercedes has been approached for a comment.

Additional reporting by Jim Holder.

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Dieter Rencken
Dieter Rencken has held full FIA Formula 1 media accreditation since 2000, during which period he has reported from over 300 grands prix, plus...
Keith Collantine
Lifelong motor sport fan Keith set up RaceFans in 2005 - when it was originally called F1 Fanatic. Having previously worked as a motoring...

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133 comments on “Mercedes set for crunch meeting to decide whether it will quit F1”

  1. Nice title image of cloudy skies over the three-pointed star :)

    It’s no surprise that this decision was in the making, what is surprising is that it has come to light. Assuming Dieter and Jim didn’t get upto Mission: Impossible-style hijinks, one would think that such a meeting would have been kept in confidence (e.g. kept off agendas, referred to by a code name). So kudos to them for breaking this.

    Very interesting – and practical – tidbit about the Aston Martin/Toto link. Aston’s brand cachet would be better upheld by the Brackley-based team than RP.

    1. if RP becomes Aston Martin and they merge with current Mercedes team in 2021, does that mean that Hamilton (if he stays) will be teammates with… Lance Stroll?

      1. Lewis will go back to Mclaren.

        Merc have made such tireless (and successful) efforts to downplay their PU dominance and ensure the PU regs stay the same. They’ve sadly been successful in this and know their dominance will continue unthreatened until 2025, when they will pull out.

        1. PU dominance… unthreatened till 2025?? In terms of raw power, Ferrari was better last year. Mercedes won most races because they had a much better chassis / aero package, but all the pole positions on power tracks (Monza, Spa, Canada, Austria, Japan, etc) went to Ferrari.

          Indeed, reliability wise Mercedes still felt slightly stronger than Ferrari and RedBull, but this advantage is surely not going to last that long.

          1. With the rule clarifications it remains to be seen if Ferrari can maintain engine dominance.

            Many think not.

        2. Excellent post.

    2. sorry, it wasn’t meant to be a reply to @phylyp comment :(

    3. @phylyp Daimler AG is traded quite publicly so any “secret agendas” and “hidden codes” is just nonsense. They are under very tight scrutiny from several authorities about announcing anything that could affect their stock price.

  2. Would be an interesting twist if the reason Mercedes F1 stopped their winning streak was not because the competition caught up, but because the team itself stopped competing.

    Not sure what to think of it, they way this article describes it, it seems like a realistic option, also, wonder whether taking over this great team would mean an easier (legally speaking!) way to reduce the workforce as will be needed to meet 2021+ cost cap, as it can be seen as a takeover/reorganization.

    1. It is, of course, exactly what happened last time Mercedes were in F1, though the circumstances of their withdrawal then were rather different.

  3. Merc should give their best this year, win them all, quit, and became F1 legend.

    1. Like Rosberg?

      1. When did Rosberg win all the races in a season; or even the majority of races?

        1. Mercedes is not going to win all races there are several tracks favorites the other teams too much.

        2. If my reading is correct, I believe @glynh is just making a joke about the juxtaposition of “quit” and “become F1 legend”, by indicating that Rosberg didn’t achieve the latter despite doing the former.

          It’s a joke, just run with it, don’t look for complete factual accuracy :)

          1. @phylyp is right. It was just a joke because Rosberg won then quit and hasn’t really become a legend. :)

          2. I don’t know, it kind of legend-ish. Win a championship and announce your retirement a week later. That fact will never be forgotten. Beating Hamilton is legendary on its own, isn’t it.
            Maybe if Nico looked a little more grizzled.

          3. @phylyp: Correct. When I look for factual accuracy, I look away from the internet.

          4. I knew it just making more fun to make it black/white :)

        3. Agris Rūmītis
          29th January 2020, 21:50

          to become Champion one does not need to win all races. one is enough. ask Rosberg

          1. Potentially even 0 races would be enough, it just hasn’t happened yet and might never happen, especially with an increasing number of races on calendar.

          2. …it also helps if your nearest rival [team mate] DNF’s mysteriosly for no apparent reason [Malasia]

  4. Fiat don’t have a problem with pouring millions into the Ferrari F1 team, and they haven’t won anything for 12 years. Winning races around the globe, creates huge publicity for Mercedes at little expense, considering the $5b they spent on advertising in 2016.

    There’s no way they’d allow their cars to be owned and branded by a competitor, even if Aston Martin are a tiny company in comparison. Toto is a racer, he’d be running Williams if he’d stayed there, he’s in F1 for the long term. We’ve no idea what Stroll Snr will do when his son finally stops racing, which could be any time in the next 10 years

    1. Ferrari is an independent company from FCA, so they don’t have a say, and Ferrari brand image is a race team (hell, their NYSE ticker is “RACE”). You can’t really compare them.

      1. And also, as far as I know, Ferrari is more niche, but expecting to increase their growth by now bringing a SUV to market, rather than having to contend with the diesel scandal, reducing sales, and a need to cut costs, so from that point of view, it is indeedc a rather different case @losd and John Bee

        1. Agris Rūmītis
          29th January 2020, 22:01

          ferrari don’t build suvs to conquer the niche but because others do and too many people require such since they have too much money and too little ideas for better spending it

      2. That John Elkann is chairman of both Ferrari and Fiat Chrysler Automobiles is just a co-incidence eh? The largest shareholder in Ferrari is Exor NV, guess who’s the chairman of that company.

        1. Sure, they’re closely connected, but it’s not all that relevant. Ferrari has their own decision process and their own way to make money.

          And most importantly: their own budget. It doesn’t really matter to them that FCA is burning through cash.

      3. Lewis u-turn to demand more salary for his contract-extention does not make sense with the current uncertain MB-F1-future. If Daimler really wants to cut costs Mercedes F1-future looks like to end.

    2. Fiat don’t have a problem with pouring millions into the Ferrari F1 team, and they haven’t won anything for 12 years. Winning races around the globe, creates huge publicity for Mercedes at little expense, considering the $5b they spent on advertising in 2016.

      But how much do Ferrari spend on advertising? And could a ‘volume’ car manufacturer like Mercedes afford to do without conventional advertising?

      1. I’ll help Joe Bee out with the answer to the first question which is £0. F1 is their advertising.

      2. We know Ferrari don’t spend on direct advertising now, they have in the past, I’ve seen the adverts. Ferrari have used F1 to become an icon, but there is always room for another, as McLaren have discovered. Mercedes produce fast sports cars, we don’t only see them winning races, but they still lead the pack when the cars have slow down too. Priceless advertising.

    3. I don’t think that’s the point, honestly. Maybe a lil bit biased?

      I suppose that winning is very expensive in terms of bonuses every (I suppose) member of Mercedes F1 Team receives throughout the year as victories pile up. I don’t think Lewis (to point maybe the most expensive line) would just appreciate a friendly pat on his shoulder as winning bonus. Nor the management would…

      Maybe Ferrari or other teams may come to a better financial place staying afloat between the second and the third place, maximizing the advertising. but minimizing the bonuses. My guess.
      I’m not saying they face positive figures, but…

  5. Ola Kallenius is a bean counter of the worst kind, and I have no doubt that he and his supporters at Daimler will force a Merxit from F1.

  6. This i would like to see. I am fed up watching Mercedes win everything and more. We need different winners through each and every year. If this does come to pass then Hamilton will win in 2020 and then go and someone else can make the running. The Mercedes juggernaut has just rolled on relentlessly and no one could and can match it…not even Ferrari or Red Bull. I really don’t see any reason why they will not continue in 2020.Hamilton will not be missed. He’s had is time in the sun and has become just another boring entity.

    1. The liberty media argument/FIA, when demonstrations of excellence become boring, we will just get rid of the excellence…

      Why do you watch sports?

    2. “Hamilton will not be missed. He’s had is time in the sun and has become just another boring entity.”

      I was reading your post wondering where the real crux of your post was, and there it was, at the end, waiting to be unleashed, lmao.

    3. Just another sore loser.

      1. Not just a sore loser, he is a born loser

      2. Born losers blame winners for constantly winning rather than look at the incompetence of the losers/themselves, that is why born losers even lose when they have won.

    4. #kenji

      Hamilton will not be missed. He’s had is time in the sun and has become just another boring entity.

      I’m not a Hamilton fan as such but that comment is not just bazaar but it’s totally wrong in my opinion. I would say Hamilton has the highest profile worldwide of any driver and is a very valuable asset to F1.

      1. I agree with your comment too, Lewis is a valuable asset to F1. Yes, he will be missed when he leaves F1, especially if he leaves before his abilities degrade due to age.

    5. I see your point and honestly I do share it from a sport-like point of view. However I don’t think Mercedes has to be blamed for it, but the sport administration itself. Probably biased watchers won’t admit it but, man, F1 is horribly boring: I keep watching it for pure compulsion and always expecting something new, but…
      With that said, Mercedes will be missed for the challenge it anyway brings to the table and Lewis won’t…simply because whatever will happen to Merc, he will stay in the Circus for the next years for sure. And honestly that’s a blessing for the sport. Moreover I can’t believe I’m the only one who wants to see whether his talent is car-related or a genuine one even on more troublesome cars.

      Maybe with Merc disappearing and a more balanced pack, we could see some more midfielders incursions on top. Who knows?

    6. Mercedes earned it. They didn’t cheat their way to it, nor did they put in investments unattainable by their key competitors of Ferrari and RBR.

      Yeah, there were periods of Merc dominance that were boring, but that was more due to the competition not stepping up across the board. I’d hardly blame Merc for the failings of their competition. And those occasions when the competition did step up (sadly, only for a few races at a time, not enough to seal a season), Merc were ferocious in their pursuit of their lost P1.

      And yes, I agree with @johnrkh that Hamilton is probably the only F1 driver to have strong visibility even outside of F1, which is why Liberty also view him an as asset to the sport.

      1. @phylyp – is forcing the PU regs into a direction you’ve been developing for years “earning it”? is using your clout as a manufacturer to have those regs locked in so no one can catch up “earning it”? is operating a close corporate partnership with the sole tyre supplier including an illegal tyre test “earning it”? is the complete lack of any attempt made by f1 to address any of this (as they have countless times in the past when teams show dominance) “earning it”?

        f1 knows the only story it has right now is the re-writing of the record books, courtesy of mercedes, so it’s not going to do anything to stop it. this dominance is founded on boardroom politics more than “the competition not stepping up”. it’s just a shame so few understand the illegitimacy of these titles…

        1. Conspiratorial nonsense and lies, keep crying

          1. @megatron – what an insightful response…

        2. @asherway, the problem with your claim that Mercedes forced the regulations in a particular direction is that the current regulations were originally developed by Renault, not Mercedes.

          The journalist Adam Cooper has previously published extracts from the original proposal document that Renault put to the FIA in 2007 that formed the core of the current regulation set. The twin recovery systems – one thermal and one kinetic – combined with a smaller capacity turbocharged engine was entirely Renault’s idea, and they were the ones who largely drove through the current regulations.

          Don’t forget that, when development first began on these engines, the expectation was that Renault would be the manufacturer that would have the biggest advantage, not Mercedes, because Renault were the first ones to begin development – they were the first manufacturer to develop a single cylinder prototype to demonstrate the viability of the concept.

          Has all of Renault’s lobbying and public support in the early stages to push through what became the current rule package been completely forgotten, as well as the public threats that Renault made about pulling out of F1 if the sport did not adopt their proposals? Have the workshops, which the FIA made formal public announcements about, with potential engine developers that were undertaken to refine the regulations – workshops that involved all of the current engine manufacturers (the first hints that Honda was considering a return to F1 came when it was announced that they were taking part in those workshops) – been forgotten about or ignored?

          I know that some of this work goes back 10, 11 or 12 years ago, so perhaps memories have faded or, if you didn’t read the articles at the time, it’s easy to miss it, but it seems that Renault’s problems with this current regulation set means that people forget how much work Renault was doing to encourage the sport to adopt the current rule set in the first place.

          1. @asherway read anon’s response above.

            Also, the original rules called for an I4 engine until Ferrari threatened to use their veto to force thru a v6 layout. It is well established that all the current PU manufacturers, along with the FIA, led by Gilles Simon, were intimately involved in making the rule set for tge PUs that were ultimately unveiled in 2014(was originally scheduled for 2013).

            Your original post is in fact conspiratorial nonsense.

          2. @anon

            Have the workshops, which the FIA made formal public announcements about, with potential engine developers that were undertaken to refine the regulations – workshops that involved all of the current engine manufacturers (the first hints that Honda was considering a return to F1 came when it was announced that they were taking part in those workshops) – been forgotten about or ignored?

            What was actually ignored is that in those workshops, the FIA relied heavily on Ross Brawn’s feedback to shape the regulations.

        3. I invite you to discuss more on this in twitter, if you have an account. Your post is closest to the fact.

        4. Do not mind the replies. I appreciate your post.

        5. when has F1 been any different? At least they didn’t win cynically and cheat as Ferrari did

      2. illegal tyre testing?

    7. You would want as many teams as possible to be competitive, not reduce the number of competitive teams.

      Ferrari has had their competitive long streaks as well, yet nobody wanted them to stop racing even when they were at their best and winning their fifth straight title. People wanted somebody else to challenge them (and win, cos to see chang while Ferarri themselves were competitive and adding to the spectacle.

    8. Geez I really did not see this coming at all.

      If the only reason other teams win is because the current champions reliquish their throne, then it doesn’t bode well for engineering excellence. It should be that the other team takes that mantel because they improve in some way on what was.

    9. I am fed up watching Mercedes win everything and more. We need different winners through each and every year.

      I gotta love that you blame Merc for this (even putting aside your conspiracy nonsense and obvious anti-Hamilton vibe).

      One team did better than the others. Now you’re happy that the one that did the best job may be leaving, and we will be left with the teams which did not do as well.

      Would you also fire the guy at work who does the best job because he makes the rest of you look bad?

      In fact, let’s make the competition even better, and kick out any team or driver who wins more than their “share” of races. Force everyone to come out with the same number of points, coz it’s unfair if the best team or the best driver is able to win more than anyone else!

  7. Interesting.

    1. I would be interested in seeing the actual figures for the investment to buy and develop Brawn into its current excellence against the returns including for like promotional benefits of success. I would think it’s quite a respectable return as would be for the purchase of the innovative engine plant at Brixworth.

      I do wonder if the concern is global image with so many companies going bananas over being “green”. Formula E doesn’t have the taint of huge engines pushing out enormous amounts of pollution.

      Not really the case, of course, but F1 seems ashamed of its huge strides in fuel economy and emissions in its hybrid era. And that might be its downfall.

      1. Mercedes have spoken about that, towards the end of last season – they were specifically targeting this kind of silly story.

        Merc say their net spend is close to zero. Something like Hamilton’s salary away from breaking even. They haven’t had any real competition, so it hasn’t been a spending-race, so they’re managing with the revenues the team brings in plus a few terms of millions from the parent company.

        It’s an absolute no brainer for Merc. They spend more on advertising the F1 successes than they do in gaining them.

  8. I wouldn’t be surprised if they did leave and went back to being an engine supplier – after all with the success they’ve had the only way is down and I’d imagine staying at that level is not cheap. If they want to save money and tout their ‘green’ credentials spending billions in F1 isn’t a way to go.

    The Stroll/Wolff/Aston Martin takeover sounds interesting but doesn’t that leave Mercedes supplying too many engines? Williams, McLaren, RP & potentially Aston seems far too many.

    1. Yep, an engine supply would be an easy way to continue recouping their investment on the current crop of V6-hybrids. I’d expect them to probably quit outright the next time engine regs change sign