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Analysis: What now for Formula One?

Formula One, already struggling to shape its future and put on a show, is staring into the abyss after Ford's decision to pull out and sell its Jaguar team.

Formula One, already struggling to shape its future and put on a show, is staring into the abyss after Ford's decision to pull out and sell its Jaguar team.

The world's third largest carmaker sent a shockwave through the troubled glamour sport with its announcement on Friday that it could see no compelling business argument for continuing in Grand Prix racing. As one senior Formula One source commented afterwards: "This is a wake-up call. I mean, if Ford can't make it work, who the hell can?"

The trouble for Formula One is that there have been other wake-up calls in the past, particularly the collapse of the Prost and Arrows teams in 2001 and 2002, yet still the ship is heading for the rocks.

The cost of competing in a series set to expand to 19 races next year has become prohibitive to all but the biggest carmakers. FIAT-owned Ferrari, the team of seven times World Champion Michael Schumacher whose enduring dominance threatens to turn off viewers, and Toyota - the sole newcomers of the last five years - are estimated to operate on annual budgets in excess of $300 million.

At the same time, the carmakers are threatening to start up their own rival championship while commercial supremo Bernie Ecclestone is at loggerheads with shareholding banks.

Image Blow

There is controversy and uncertainty surrounding major rule changes due to be introduced next season and even a question mark over those who run a sport that commands vast global television audiences.

Max Mosley, president of the governing International Automobile Federation (FIA) announced this year that he was standing down. Then he changed his mind. The architect of major changes designed to cut costs and open up the sport to new blood, he may go next year - but even that is not certain.

Ecclestone is 73 and with no heir apparent. His dictatorial style of management puts him at odds with the carmakers who want a far greater share of revenues before the 'Concorde Agreement' between all parties in Formula One expires at the end of 2007.

"Such an expensive sport cannot survive if we do not increase revenues," declared Ferrari boss Luca di Montezemolo in Italy last weekend.

"A certain era is finished and we have to look at something new which is totally acceptable to the players who at the moment get only 47 percent of the money from TV rights and nothing from the tickets, advertising and other sources of income.

"There is a big risk to lose teams and I don't see any real determination to find solutions."

The turmoil can only unsettle sponsors and would-be investors, while the departure of Jaguar, one of the world's great marques, is a blow to Formula One's image.

Jaguar always rejected backing of tobacco companies, the lifeblood of half the grid including champions Ferrari, and their departure will be a setback to those who want to see the sport free of such sponsorship.

Possible Buyers

But the real damage will be if nobody can be found to buy Jaguar in the next few months.

Three-times World Champion Jackie Stewart, who sold his eponymous team to Ford in 1999 for a reputed 50 million pounds ($89.77 million) will not be bidding. "I've been there and done that," he said.

Possible candidates would be Christian Horner, the boss of Formula 3000 champions Arden who has said that he wants to move up to Grands Prix, and a group of Dubai investors who have declared an intention to take over a team.

Austrian Red Bull energy drink magnate Dietrich Mateschitz, a Jaguar sponsor, could also be an interested party.

They will all need an engine and it is the fate of Ford-owned Cosworth, whose involvement in Formula One spans four decades, that poses as much concern. Cosworth, who provide engines to struggling Jordan and Minardi, is also up for sale.

The race now is against the clock, with the season ending on October 24th and Ford unlikely to want to continue bankrolling Jaguar for too long.

There are genuine fears that three teams could be in jeopardy, threatening hundreds of jobs and imposing a considerable financial burden on those outfits that remain.

Under the 'Concorde Agreement', there must be a minimum of 20 cars on the Grand Prix starting grid. If the number of teams falls below 10, then the others must make up the difference by running three cars. If three teams were to disappear, then the remaining seven would have to provide six extra cars between them.

That could provide an opportunity for those drivers, such as Britons David Coulthard and Anthony Davidson, who might have hoped to join Jaguar next year and whose chances of a competitive drive are otherwise fast receding.

But it might also be the last straw.

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