Andretti entry bid rejected by F1 on commercial grounds
F1 has rejected the American Andretti team’s bid to enter the sport in the next two years – but left the door open for admission in 2028. Andretti’s entry had been approved by the governing body, however, Liberty Media which holds the commercial rights holders F1 felt the proposal for entry in 2025 or 2026 was lacking.
F1 conducted analysis involving key stakeholders and decided an eleventh team “would not on its own add value” and does “not believe the applicant would be a competitive participant”. This appears to be under the current proposals as Liberty Media has suggested that should General Motors build an engine for 2028 there could be an opportunity to re-evaluate the entry.
GM, which backed the deal has already teamed up with Red Bull to build engines while sister brand Cadillac, has said it plans to build its own F1 engine in time for the 2028 season.
F1 said it would “look differently on an application for the entry of a team into the 2028 championship with a GM power unit, either as a GM works team or as a GM customer team designing all allowable components in-house.
“In this case, there would be additional factors to consider in respect of the value that the applicant would bring to the championship, in particular in respect of bringing a prestigious new OEM [car manufacturer] to the sport as a PU [engine] supplier.”
F1 said that before that stage, “the need for any new team to take a compulsory power-unit supply, potentially over a period of several seasons, would be damaging to the prestige and standing of the championship”.
Andretti’s plan has faced public opposition the expansion of the grid on commercial grounds, arguing that Andretti would not bring sufficient added value to the sport to negate the loss of income with the prize pot being split eleven ways instead of ten.
They rejected that Andretti, an established brand in IndyCar, Formula E and Extreme E, “indicates that F1 would bring value to the Andretti brand rather than the other way around.”
Michael Andretti is one of the most successful Indycar drivers of all time who also raced in F1 for most of the 1993 season for McLaren. His team competes in Indycar, endurance racing, touring cars, and the electric Formula E and Extreme E championships. While his father Mario, is a motorsport legend who raced in F1 from 1968 to 1982, and won twelve Grands Prix in addition his world title. He was also successful in Indycar and endurance racing, is a figurehead for the team.
F1 said it was “not able to identify any material expected positive effect on CRH financial results, as a key indicator of the pure commercial value of the championship”. The decision was arrived at following research and analysis involving broadcasters, sponsors and circuits – the sport’s main revenue streams.
The other thing brought up was the fact that entering next year then having new regulations in 2026 would be a big thing as well as switching PU suppliers. ‘The need for any new team to take a compulsory power unit supply, potentially over a period of several seasons, would be damaging to the prestige and standing of the Championship.’
However the key thing was around engine supply, F1 believes at the short-term engine supply with a current supplier would ‘too big a compromise on the team’s potential competitiveness.’
It is a different situation from that of a normal customer engine supply – such as that of Mercedes with McLaren – because of the potential risks to intellectual property and the restrictions F1 considers that would place on collaboration.
Analysis
I’m not surprised by the decision by Liberty not to accept the offer given the public resistance to this by other teams, however, I am surprised they weren’t consulted. We know that until recently because of multiple factors rather than Covid financial stability has seen many teams struggle to turn a profit and before Haas, the three teams which entered in 2010 have all gone bust in five years.
This entry felt more solid given the failures a decade ago, you need to wonder if there is a fear from F1 about damage should Andretti fail. If it’s a bad decision we may not be able to answer for years yet.
The boom we have had in recent years isn’t looking to be a factor, but what the problem looks to be is the dilution of prize money, marketing general business things. I think that they couldn’t answer for FOM the ‘benefit brought right now’ question, but this is do Andretti takes away and learn from this I don’t think they will give up on eventually entering the sport.
I think seeing how this plays out whether Andretti decides to wait until 2028 and if FOM/FIA as well as Ford or Cadillac can continue discussions and build a better case to put forward. But this could be damaging for F1 rejecting a well-known US team who have won IndyCar and last season Formula E championships could hurt and slow that down.