The 10 existing Formula 1 teams are seeking the limit of outfits allowed onto the grid to be reduced from 12 to 10 in the forthcoming Concorde Agreement, according to reports.
The current terms allow for 12 F1 squads to partake once commercial terms are agreed with an anti-dilution fee of $200 million to mitigate spreading prize funds beyond 10 outfits.
This prompted the FIA to open a tender process at the beginning of last year to attract one or two new entries to participate in F1.
Andretti was the sole prospective entry to pass muster with the FIA, but it was not given the green light to enter from 2025 from Formula One Management (FOM).
With F1’s value growing and the value of its teams along with it, there’s a call to shut up shop and stop the grid growing in the next Concorde Agreement, where commercial terms will be signed for a five-year period from 2026 through 2030.
Reporter Joe Saward understands that both F1 and the teams within it wish to cap the number of competitors to 10, meaning the only way a new entrant could participate is if they bought an existing entry.
Since Liberty Media acquired Formula 1 in 2017, the sport has turned toward a US-inspired franchise model and, understandably, the current teams would be wary of splitting revenue with new entries given the hardship endured to reach this profitable period.
From the financial troubles endured during the Covid pandemic in 2020, the 10 existing F1 teams are now near £1 billion valuations, at least according to McLaren CEO Zak Brown.
If a limit on the number of competitors allowed into the series can’t be capped moving forward then it is more than likely the anti-dilution fee for prospective teams will skyrocket from its initial $200 million.
Another potential sticking point noted by Saward includes the ownership structures of teams, with there being talk it would be in the best interests of the series to have each team owned independently.
This is in reference to the Red Bull parent company owning both Red Bull Racing and the Faenza-based RB outfit, an ownership structure that has been in place for nearly two decades, but one that has been called into question recently by the likes of Brown, who cites the cost-cap amongst other reasons as to why RB should become an independent entry.
The McLaren CEO even went as far as to say the ownership of two teams in Red Bull’s case is “against the fairness of the sport.”
The new commercial arrangements constituting the next Concorde Agreement from 2026 through 2030 will need to be signed before the end of next year.
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