The Formula 1 paddock is in turmoil over controversy as rival teams oppose a cost cap adjustment that is expected to benefit Audi when it enters the sport in 2026. Audi, which takes over the Swiss-based Sauber team, will uniquely benefit from a cost cap 'consideration factor' intended to take into account higher salaries in certain countries —a movement that aroused strong opposition.
“A Division of the Cost Ceiling”
The adjustment, approved by the FIA earlier this year, introduces a mechanism to account for higher salaries in Switzerland compared to traditional Formula 1 hubs in the UK and Italy. The “Consideration Factor” will calculate a team's country average annual salaries against a weighted average, using independent economic data from the OECD.
The FIA argues the move levels the playing field for Sauber, which would otherwise be at a disadvantage due to the higher cost of living in Switzerland. However, critics view this adjustment as an unnecessary exemption that compromises the integrity of the cost cap.
“Why does a team based in Switzerland get an exemption? Everyone chooses where to install their team,” said Haas team boss Hey Komatsu.
“Rivals Express Their Frustration”
Komatsu wasn't alone in questioning the fairness of the adjustment. With nine out of ten teams apparently opposing the measure, the resistance was loud and clear. Komatsu has highlighted the complexities of cost caps, arguing that trying to account for every variable is impractical and risks setting a dangerous precedent.
“Where do we stop?” Komatsu asked. “Should regional differences in the UK be compensated for? Or the engineers who move to Italy? It’s impossible to make this completely fair.”
He also emphasized that the decision to base a team in Switzerland is voluntary and could offer benefits beyond salaries, such as lifestyle benefits for employees.
“The FIA Defends Its Position”
The FIA single-seater director, Nikolas Tombazisstrongly defended the adjustment, calling it a necessary move to ensure fairness for Sauber and avoid economic pressures forcing the team to relocate.
“We found that a team in a high-cost country like Switzerland would have 30 to 40 percent fewer staff for the same cost cap,” Tombazis said. “It’s fundamentally unfair.”
Tombazis added that the adjustment is supported by compelling data from OECD research and F1 team salary reports, ensuring its transparency and fairness.
“Without this adjustment, Sauber could be forced to close or move, which we believe is not fair for a world championship,” he explained.
“Wider Implications”
Rival teams are concerned that this adjustment could open the door to other exemptions. If Switzerland's costs are recognized, they argue, why not adjust for regional disparities within the United Kingdom, Italy or other countries? The concern is that the cost cap—a pillar of F1's financial fairness—could collapse under the weight of the exceptions.
“It's a slippery slope,” Komatsu warned. “Unless every variable is taken into account, which is impossible, the system risks becoming fundamentally flawed.”
“The Audi Advantage: Opportunity or Unfair Advantage? »
For Audi, the adjustment offers a significant advantage as it prepares for its 2026 entry. By benefiting from a higher effective cost cap, the German manufacturer could field a more competitive team sooner than its rivals do. 'anticipate. However, this advantage is precisely what has other teams on edge, as they fear it will skew the competition in favor of a newcomer.
“Looking towards 2026”
With just two years until Audi joins Formula 1, the debate over adjusting the cost cap is unlikely to die down. Although the FIA insists the change is right and justified, rival teams remain sceptical, with some questioning the governing body's commitment to neutrality.
“This is a democracy where nine wolves and one sheep sit at the table,” Tombazis said. “Sometimes it’s our job to ensure fairness, even if it’s not popular.”
The controversy highlights the delicate balance Formula 1 must maintain between encouraging new entrants and maintaining a level playing field. As the paddock watches Audi's progress, the long-term ramifications of this decision could shape the sport's financial landscape for years to come.
