GPWC Offer Teams to Double Profits

Formula One teams could double their share of the sport's revenues if they join the rival series created by the Grand Prix World Championship group, according to a report by the Financial Times.

All 10 of the current teams signed a memorandum of understanding to work together with GPWC in planning a new championship that could start in 2008, when the existing Concorde Agreement between team principals, Formula One's ruling body - the FIA - and the sport's commercial rights holders expires.

GPWC was set up by some of the car manufacturers involved in Formula One in order to create the championship that would allow the teams to get a bigger share of the huge revenues generated. The carmakers are Ford, owners of Jaguar, Ferrari's parent Fiat, Williams's partners BMW, McLaren's shareholders DaimlerChrysler and Renault, who have their own team.

Currently the teams receive a 47 percent of the revenues, among others, from television rights and fixed fees.

According to the Financial Times, the teams would receive up to 75 percent of the revenues if they joined the GPWC championship, which would amount to a total of around €330 million ($360 million). That compared to an estimated €183 ($200 million) the teams received last year.

The teams would also share an annual bonus equal to 50 percent of GPWC's profits, and the balance of the other 50 percent after payment of any tax or investments in the championship.

The GPWC memorandum also promised all the dealings would be transparent for the teams, although some rumours at the San Marino Grand Prix claimed the company had offered an advance payment of $50 million to World Champions Ferrari in order to join the new championship. The Financial Times, however, said the memorandum made no mention of the payment.

FIA president Max Mosley, who had dismissed the threat of the GPWC series initially, recently warned that the Formula One split was looking more likely each day, and some team bosses agree.

"Everyone has been somewhat dismissive of GPWC and I personally have not been comfortable with the notion of manufacturers running the premier series in motor sport," BAR boss David Richards told FT. "But things have moved on in the past few weeks and GPWC has now got to be taken seriously."

Team boss Frank Williams, however, played down the GPWC threat and said he was confident a new agreement would be reached with Formula One supremo Bernie Ecclestone before the current Concorde Agreement expires.

"There'll be a deal [with Bernie], a new deal, probably in the next 12 months," Williams said.