10 April 2018
Notebook from the Big Texas Barbecue and Waffle House
The offset Formula 1 timetable in Bahrain means that our lives become rather more bizarre than usual, at least in terms of eating and sleeping. We don't finish work until quite late and so the teams tend to move to a regime that fits the timetable, even if it does not fit the daylight. So you find yourself walking through the long echoey tunnel to get to the brilliant Media Catering area, heading off to lunch with a flow of F1 people arriving, all saying "Good morning!", while you are saying "Good afternoon".
People eat breakfast at lunchtime and we are all surprised when we find it is three in the morning when we get back to the hotels in Manama, a city that never seems to sleep. Add to this mix the fact that the local weekend runs from Thursday to Saturday so things are wild on Thursday nights and Saturday nights are quiet, although the residents of Bahrain (all 1.4 million of them) seem able to conjure up a traffic jam whenever you don't need one, even at strange hours of the morning.
I suppose that the nocturnal activity in these parts is due to the days often being searingly hot. The driving is best described as "colourful", as the concept of "mirror, signal, manoeuvre" has yet to be truly introduced into the Persian Gulf and one gets the impression that any driving test must consist of asking which is the front end of the vehicle. One sees a lot of fender-benders in Bahrain as a result. With almost half the population made up of foreigners (according to UN data it's 48 percent) you can sometimes get the feeling that you are in India, although the expat US community is substantial because of the military and intelligence facilities that can be found on this island in the sun.
Ask some of these folk what they do and they say "consultant", but they become very vague when you ask on what they consult… When that strange species of human, known as the Guardian-reading Western Liberal, thinks of Bahrain, they make tut-tutting noises because of some political upheavals a few years back, but they forget (conveniently perhaps) that this cheerful island nation plays host to an impressive array of Western military and intelligence organizations, in addition to being the home of the US Fifth Fleet, which is responsible for the Persian Gulf, the Red Sea, the Arabian Sea, and parts of the Indian Ocean. In the days before the Grand Prix this year Britain opened a naval base in Manama, the UK's first military establishment east of Suez, since 1971.
Other nations in the region do not much like Bahrain's lovey-dovey relationship with the West and the troubles during the Arab Spring were caused, in part, by deliberate attempts from across the waters to destabilize the country.
On the ground, the average Bahraini seems to be happy-go-lucky, keen to turn a buck and proud of their country and what has been achieved with what was once a deserted island with little to commend itself beyond a great deal of sand. Unlike the other Gulf nations, Bahrain has built itself without massive oil revenues, although 86 percent of its budget revenues relate to oil, as it refines large amounts of crude oil for others. Its other big industries are aluminium smelting, finance, construction and tourism. The Grand Prix has played an important role in developing tourism, although the unrest in 2011 hurt the industry significantly and the country has struggled with budget deficits as a result. Despite this, the Grand Prix remains one of the most popular races of the year. It is well-organized, they really care about the sport and the circuit is well-designed and has a great deal of charm. The decision to switch the race to nightfall made a big difference.
A few days before F1 arrived this year, the country's National Oil & Gas Authority (NOGA) announced the discovery of oil reserves amounting to 80 billion barrels of shale oil and an estimated 14 trillion cubic feet of gas. This is located in the shallow waters to the west of Bahrain, close to one of the few fully-operational oil fields the country has, which means that it will be easy to connect the new field to the existing infrastructure so that oil will begin to flow in around five years, providing the nation with much-needed money to further development and diversification. To put the find into perspective, Abu Dhabi has reserves estimated at 92.2 billion barrels of oil reserves and is one of the richest countries in the world.
So, all of a sudden, the future looks a great deal brighter for Bahrain and we F1 folk are happy that they are happy.
We stay in Juffair, a district of Manama that is close to the various international bases, were construction is never-ending but which is bustling and lively. We stay in a hotel that offers 24 hour a day room service and a restaurant that stays open until two in the morning, although we rarely get there. But, when we do, we find ourselves in a place that feels like part of Texas with Country music, Jack Daniels posters, battle flags and beer. They have people from Nashville who sing Johnny Cash songs, with voices that don't quite hit the low notes, but they offer vast portions of Key Lime Pie and ribs so large that they seem to have been hewn with chain saws.
The big story in the F1 Paddock was the meeting on Friday at which Liberty Media presented the teams with its proposals for the future of the sport. The details of this were kept under wraps to a remarkable extent, with everyone trying their best to keep quiet. But old habits die hard and so some of us who have been around a while were able to get a pretty good idea of the plan, and it makes a lot of sense. On the commercial side, Formula 1 has two big questions that need to be answered: what is the presence of Ferrari worth, and what is the right figure for a budget cap?
The big teams, inevitably, look at this with self-interest in their hearts and are keen to oppose change, while trying not to appear as self-interested as they are. It's a juggling act and Liberty Media knows it. Most of the teams are happy for Ferrari to get a little extra money because the Prancing Horse does have a value, but getting $100 million a year in bonuses not related to their performances, is a bit much. The previous deals struck to get a deal at the last round of commercial negotiations won the teams a bigger share of the revenues, but almost all of this went to the big teams to win their support in the negotiations so that the then owners could get the stability they needed to sell the business. The new owners want to unstitch these deals and share the money in a more sensible fashion, which is the right thing to do. Let us not forget that a number of teams disappeared because the big teams were taking more than their fair share.
The big secret about the proposals put forward is that Ferrari will not be the biggest loser. It will lose perhaps half of its bonuses (about $50 million) but with the overall prize money increasing in value they will gain back about half of that loss. The biggest losers will be Mercedes and Red Bull, which each stand to lose $75 million. Red Bull, however, has two teams and so the overall loss will be offset by increased prize money of around $50 million, and so it is going along with Liberty Media because it also wants to have rules that will mean it no longer has to depend on the engine manufacturers. If all goes to plan it will have its own Aston Martin-badged engines in 2021. The other teams are all happy with the new revenue splits, so the big problem is not Ferrari but rather Mercedes.
The budget cap is where there is likely to be the most skirmishing with the big teams arguing that this will lead to job losses. This is a rather dubious argument because it is fairly obvious that giving the smaller teams more money and forcing the bigger teams to accept spending limits will inevitably lead to staff spreading through the grid, thus creating more competitive teams and therefore closer competition. It may also turn out to be an advantage for the big companies as it could allow them to get two teams for the price of one. Ferrari's sister company Alfa Romeo, for example, has F1 ambitions, in order to promote its road cars, and the current sponsorship of Sauber is seen by most people in F1 as a step towards Alfa Romeo taking over the Swiss team and transforming it into an Alfa Romeo factory team, probably using Alfa-badged Ferrari engines, or power units developed from the same platform. The budget cap would thus be a great help for the Fiat-Ferrari family of companies, giving them two F1 programmes for the cost of one.
Other manufacturers could do likewise if they want to and they can also have their own platforms so that Volkswagen, for example, could design one engine but supply three teams (factory or customer) with differently-branded units. Thus brands such as Porsche, Lamborghini and even Bugatti could be seen in F1, which would add to the glamour of the sport and help companies sell their road cars in a highly cost-effective manner.
There is also the possibility of independent platforms, with several car companies sharing the research and development costs and then using their own versions of the base engine. This is how McLaren and Aston Martin are intending to build their own engines.
Again, the one company with a problem is Mercedes, because it does not have any other suitable brands to use in F1, although it could take over another smaller team to help its efforts, in much the same way as Red Bull does with Toro Rosso. A Mercedes Junior team seems a logical way forward, badged in whatever fashion they desire.
Beyond the big picture stuff, it is still relatively early in the season for much in the way of changes. There has been a lot of jibber jabber about McLaren not doing very well, but the monkeys with their typewriters have overlooked the fact that after Bahrain the team is third in the Constructors' Championship, ahead of Red Bull and Renault and behind only Ferrari and Mercedes. Things are so close that nine teams have scored points, with the only exception being Williams, which is in the spotlight now because being last in the Constructors' Championship, while using Mercedes engines, is a pretty woeful situation.
Elsewhere there are whispers that Renault's F1's Chief Technical Officer Bob Bell may soon be moving on, with his role being taken by new recruit Marcin Budkowski. Renault continues to strengthen its staff and facilities as it builds up to mount a stronger challenge in F1 in the years ahead and this would not be a surprise. There was also some chatter about Kimi Raikkonen's future (or rather the lack of it) at Ferrari. Raikkonen is very popular with the fans but he hasn't been doing a good enough job for a long time and in the tight fight today, Ferrari may eventually conclude that it needs a stronger number two. The big question is who?
Elsewhere in the news, the Formula 2 boys produced two very good races and showed that there is plenty of talent on the way up the ladder. Lando Norris won the first race at a canter, finishing ahead of his Carlin team-mate Sergio Sette Camara from Brazil with third place going to Russia's Artem Markelov, who has to win the championship this year if he wants to make progress as it is his fifth year at this level. Fourth place was a good showing from Alexander Albon, particularly as his deal with DAMS was a one-off race deal. The word is that the Anglo-Thai driver will soon secure the budget he needs from an investor who is putting up the money on the basis that he will benefit from Albon's future earnings if he can make it through into Formula 1.
The scrawls in the notebook include the fact that Eddie Jordan was not present, as he was away celebrating his 70th birthday with a bunch of his chums in Switzerland. Bernie Ecclestone was present but kept a low profile, rather than stirring things up. This was probably a wise move. Also present was a delegation from Kuwait which has recently opened Kuwait Motor Town racing circuit, which is located about 25 miles south of Kuwait City, close to the border with Saudi Arabia. The $162 million facility, designed by Tilke Engineers and Architects, features seven different track layouts, the longest of which is 3.5 miles in length. There is not much hope of any Formula 1 activity in Kuwait as Bahrain and Abu Dhabi have deals that exclude other regional circuits, notably the Qatar circuit at Losail.
There continues to be talk of two new races in 2020: in Copenhagen and in Hanoi. The Hanoi deal appears to be done and will be announced soon and things are moving in Denmark, where the 55-member Borgerrepræsentationen (City Council) recently voted to push ahead with investigating the idea of an F1 street race. That is good but it will not be easy as the vote was 28-27. Things are also complicated by a rival proposal to host a Formula E in the city in 2019. If that happens then F1 will not be going to Copenhagen.
Gerhard Berger, the boss of DTM, was in Bahrain (as he usually is) but had long talks with the FIA about finding a way to integrate DTM into the structure of FIA GT racing. There have been rumours that Berger might be appointed to head Volkswagen F1 activities in the future, but Berger is a BMW man and laughed off the suggestion.