According to some sources, the current 10 teams would like the anti-dilution levy to be raised to at least $600 million; a team principal told Motorsport.com that this is the lowest figure ever reported and could be even higher.
If agreed, the new figure could force Michael Andretti to reconsider his plans to enter General Motors’ Cadillac brand, which are based on the current figure of $200 million.
Andretti still has the option to buy an existing team, although his previous offers have already been rejected by Sauber and others.
Interestingly, the potential increase in the entry fee comes just as it has emerged that Red Bull’s top management is considering the future of the AlphaTauri, with options such as putting it up for sale or keeping the team and moving it to the UK. .
Andretti is known to have inquired about buying the Italian facility in the past, and these discussions could now resume.
The price set by Red Bull is likely to be well in excess of the potential cost of $600m, but Andretti would have a good starting point with the Faenza factory and UK-based aerodynamics department. Furthermore, he would not be forced to pay his rivals.
The original $200 million anti-dilution fee was agreed to under the current Concorde Agreement, signed in August 2020 and effective through the 2021-2025 seasons. It guarantees a one-time payment of $20 million from any new entrant to each of the 10 existing teams.
The aim was to nullify the potential loss of prize money for current teams, based on the fact that a new entrant could enter as early as 2022, thus taking a share of the total prize pool for the final four Concorde Agreement seasons .
Could an AlphaTauri deal prove an attractive alternative for Andretti?
Photo by: Sam Bloxham / Motorsport Images
Having failed to enter F1 by buying an existing team, Andretti decided to start from scratch and create a new team. He is therefore willing to pay 200 million dollars and enter already 2025, the last year of life of the Concorde Agreement.
The door for new entries was formally opened in January by the FIA, which announced a call for expressions of interest for an entry in 2025, 2026 or 2027, as the first step in the process. Three potential teams are believed to have taken this step, with Andretti joined by Hitech and Panthera Asia.
The anti-dilution levy will only become relevant if a potential team passes all checks and is provisionally accepted by the FIA. If that happens, the fee will become a major talking point because while Andretti’s bid gained momentum last year, existing teams have made it clear they believe the current $200 million fee is no longer enough.
The figure was agreed in the summer of 2020, at the height of the COVID pandemic, with the F1 season just starting and racing being held without spectators.
At the time, several teams were under severe financial pressure and there were real fears that one of them might close its doors. For example, some were actively looking for new buyers or investors. The sale of Williams to Dorilton that summer also created a figure indicative of a team’s value at that precise moment.
That has changed dramatically over the past three years, with the budget cap reducing expenses and the interest Drive to Survive has helped raise revenue for the teams, who are now all in a healthy position, with some who have even rejected potential buyers.
The value of the current squads has increased significantly and there are fears of the impact an 11th entrant could have.
In public, team principals say they trust the FIA and F1 to conduct a fair entry process and determine whether any offer is viable, and stress that any new entrant must bring something to the championship.
The sale of Williams to Dorilton Capital in 2020 preceded the cost cap which has boosted the value of all teams
Photo by: Andy Hone / Motorsport Images
However, even though Andretti’s offer has apparently been boosted by the announcement of a partnership with Cadillac, behind closed doors the rival teams remain determined to maintain a 20-car grid, with manufacturer support having been largely discredited as a factor. distinctive.
From 2026 there will be a new Concorde Agreement with an inevitably much higher anti-dilution tax, which explains why Andretti wants to enter 2025 and therefore contest a season with the current engine regulations. However, the existing teams also want to change the 2025 quota already in the Concorde Agreement, despite the fact that the application process has already started.
There is a procedure for such a change, but the 10 teams and the organizers of Formula 1 should find a unanimous agreement. After months of discussions, it seems that this possibility is close.
Though Andretti has made it clear that he is willing to spend the $200 million, it remains to be seen how he and his investors will react if suddenly presented with a higher figure. There may also be a legal battle against such a change, which could be considered a barrier to entry.
The anti-dilution levy is technically linked to the potential loss of prize money from adding an 11th team, whereas existing teams link it to the potential overall value of an entry. The $600 million figure is believed to reflect the most recent deal, the sale of Sauber to Audi, and will likely be a point of contention.