Petronas should back Mosley’s push for cost cutting

Reducing the price of competitiveness will give sponsors better value as it makes the sport more exciting

Petronas is a rich company and part of the billions that they make are being spent on sponsoring the BMW Formula One team and this has a lot of Malaysians upset, especially now when the country and the world is facing the grim reality of an economic crash.
There are a lot of voices asking Petronas to stop spending money in Formula One, saying it is a waste of national resource while on the opposite camp are those who believe that the company has done well for itself, branding and global publicity wise, by sponsoring an F1 effort.
Calls for Petronas to thrown in the towel became louder when global carmaker Honda announced that it will immediately cease all Formula One efforts int he light of the current economic uncertainty and shrinking automobile market.

Honda is puling out of F1, citing budget restraint and economic uncertainty

Honda is not the only Formula One team to suffer, even mighty Ferrari is sayign that it will have to reduce it’s F1 spending

while German automotive giant Mercedes benz told its F1 operations that they have to reduce spending by 50 percent by 2010 despite winning the driver championship this year.
The case for belt tightening at a time of economic slowdown is difficult to resist and this is especially true when most of your global publicity spending rides on the most expensive sporting event in the world.
Sure Formula One reaches billions of people a year but there is always a good reason to re examine the lavish practices.

I believe that Petronas should throw their weight behind Max Mosley and Bernie Ecclestone’s efforts to reduce the cost of taking part in Formula One.
Let’s face it with the current spending rate where top teams cough up nearly a billion dollars a year to keep a two-car team in contention is unsustainable for two major reasons;

Firstly, it makes the sport less interesting as only a few teams can realistically fight for the championship

Secondly the teams will find those half-billion dollar budgets too expensive and will simply pull out

I am a fan for motorsports and more than that I am a professional motoring writer but even I find it hard to muster much enthusiasm when F1 races are reduced to a procession because the cars are not evenly matched due to the over-the top engineering.

Formula one needs to cut cost to make the smaller teams more competitive because competition is excitement and ultimately, excitement is the real crowd puller and not how much the teams spend on their racing and glamorous accessories.

If the spectators turn away from the monotonous procession of very expensive cars then F1 ceases to be relevant.

Sponsors have as much right as team principals as stakeholders in the sports and they should try to get more value out of their because at the moment top teams are spending ridiculous amount of time and money making minute improvements to small components that gives the team split second advantage over a lap.

These improvements are money wasters because the benefit they bring are too small to be measured and yet teams pour money on them because all the top teams are doing the same thing.

For example, teams may spend millions on developing a new shape or profile for a small part of the car’s suspension component to get a slight aerodynamic advantage.

The FIA’s proposal covers a wide scope of cost cutting from controversial moves such as standardised engines, to the more practical decision to use uniformed transmission system and the highly desirable change to the rule listing every compoennet of a race car and classifying them as perfromance enhancers or non performance enhancers.

Teams will be allowed to fettle with performance enhancers while non performance enhancing component will be standardised or be available through suppliers.

Sponsors contribute to lavish extras such as this team BMW luxury motorhome and pit hospitality suite

Perhaps Petronas should take a leadership position among the sponsors and bear some of their persuasive budgetary power on the teams to accept the FIA suggestions.

I believe that Petronas should continue to spend on Motosports but perhaps they should diversify their spending to include other branches of the sport such as World Rally Championship, Touring car championship and the Le Mans Series.

This is the perfect time for Petronas to get more value out of their sponsorship money.

Just because Petronas has a lot of money, it does not mean that they should not enjoy better value for their Ringgit, which are after all, all our money.