Mercedes team principal Toto Wolff says he wants to make it a “no brainer” for the team to extend its commitment to compete in Formula 1.
The world champions’ current commercial agreement expires at the end of the 2020 F1 season.The sport’s owners Liberty Media will introduce a budget cap next year to reduce the spending by top teams such as Mercedes. The team has also made two significant additions to its sponsor portfolio over the winter, AMD and Ineos, the latter announced in an event in London today.
Wolff said his target is to make participating in F1 a profitable activity for the team. “We want to make it a no-brainer from the sheer numbers,” he said. “The return on investment on marketing, should be, will be, the icing on the cake. But the Formula 1 activity will be a profitable exercise like it should be.
“We see that in the American sports leagues that most of them in the NFL or the NBA are profitable franchises. And this is my personal aim and my personal contribution with our partners to turn this into such a company so that from a Mercedes standpoint this becomes a no-brainer to participate.”
He pointed out Mercedes owner Daimler’s board chairman Ola Kallenius had previously said it was “not true” they are already planning to leave. Wolff said he hopes to reach an agreement over the team’s future commitment to the sport before the start of next season.
“It’s an ongoing process and it’s a complicated set of contracts: A trilateral contract between the FIA, the commercial rights and all teams. That needs time and the devil lies in the detail.
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“So I wouldn’t want to commit here to give you a specific date because there are quite some topics that remain to be agreed on and it’s a working process. Clearly there is the will and the wish for all of the stakeholders to come to a close before we embark on the 2021 season, because that would be an uncomfortable situation.”
“My role is is different to all the other team principals,” said Wolff. “I’m a partner in the team, I’m the managing partner of the team, we have a joint venture with Daimler. And honestly I have to pinch myself everyday to have the opportunity to be in that situation. So it’s very different.
“But we are planning our long-term strategy together with Daimler. Jim and his partners coming in is yet another building block. So all sails are set for a successful future.
“But like with Lewis we’re in the middle of discussions and tweaking here and there and I wouldn’t really want to live comment when things are going to be signed because if I give a date, then you’re going to ask me all the time.”
Wolff believes the sport remains an excellent platform for Mercedes to promote itself. “Formula 1 is the Halo platform for hybrid engineering,” he said, “something that is not communicated enough because it was talked down at the beginning of the V6 hybrid era, and it’s something we should really put more emphasis on.
“In that respect, with all the things that are out in the media, we like the platform. But at the same time, we’re in the negotiation with the rights holders and things need to be sorted out. But the partnership is clearly something that indicates our wish to continue our successful journey in Formula 1.”
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2020 F1 season
- Pictures: Wrecked chassis from Grosjean’s Bahrain fireball crash to go on display
- Bottas vs Rosberg: Hamilton’s Mercedes team mates compared after 78 races each
- F1 revenues fell by $877 million in Covid-struck 2020 season
- Hamilton and Mercedes finally announce new deal for 2021 season
- F1 audience figures “strong” in 2020 despite dip in television viewers
Chaitanya
10th February 2020, 15:53
If they manage to take 2020 titles, it should be more than enough to convince the management.
Robbie (@robbie)
10th February 2020, 17:59
Wolff wants to make it a no-brainer…I think it already is.
Jon (@talus21)
10th February 2020, 18:54
I like Mercedes and want them to stay in the series, but I don’t see that they have much to gain by continuing on. There is no guarantee that they will keep winning or stay at the top of the field. They have a lot to lose by staying in PR if things start to go badly. Especially if they have to start laying off large numbers of people from other divisions.
Phylyp (@phylyp)
10th February 2020, 21:12
Pretty strong statement from Toto here:
Toto Wolff plays down ‘nonsense’ rumours of Mercedes F1 exit
JohnH (@johnrkh)
10th February 2020, 23:29
I think this is the key statement, I think at the moment it costs Daimler around *$30 million to run the team after operational costs and profits from engine sales sponsorship and payments from F1. Which is not a lot in advertising or F1 racing terms, especially taking the success they have had into account.
But with Daimlers profits and sales being flat and looking to stay that way for a little while and the amount of money and resources that need to be committed to alternate power units to meet future regulations, Hybrids EVs and Hydrogen. I’d say the profitability of the F1 team would be a prerequisite.
*I seen that figure earlier this yr but I can’t remember where.
socksolid (@socksolid)
11th February 2020, 1:04
Spoken like a salesman. And a salesman he is. After all if merc pulled out chances are it wouldn’t make as much money for toto as staying. Is he selling the idea of f1 team being profitable for mercedes or his f1 team being profitable for mercedes? Surely being a 30% owner you want your business partner to stay regardless of what happens. It is “a no-brainer” for him for sure…
NewVerstappenFan (@jureo)
11th February 2020, 8:11
No-brainier right now. But when they stop winning and drop down to 3-4 wins per year, then it will be investigated heavily.
Commercially initial championship wins were a massive benefit for Mercedes, but now every win is probably insignificant from marketing standpoint, nobody is really surprised Mercedes is good at F1.
When they signed Schumacher that was a huge spike, then when they won first WDC and WCC with Lewis that was worth 2 billion in marketing they said.
Now I am certain that number is much smaller, but I would not be surprised that number is somewhat greater than their actual investment in the team.
If they can get the team to be close to neutral with all the sponsorships, reduction in costs then that is great. And a must have the moment they stop winning.
But when that eventually happens it might be beneficial for them, because right now they are the villain ruining the sport with their dominance. Once costs get lowered and they stop winning all the time, they should be in a good position, best thing that could happen is them beating a dominant Ferrari, that would make some news.
Or signing Max Verstappen, whatever comes first.
adiai (@adiai)
11th February 2020, 15:43
Lay off 15,000 worker so you can pay $55 million to one mediocre driver who just wins because he has a good car makes a lot of economic and business sense………
Stash (@stash)
11th February 2020, 20:51
What a complete load of waffle. lol Where were Mercedes before the new engine regulations came in? They were not winning championships. Enough said. Goodbye Mercedes.