Recession Will Hit F1 Hard, Say Team Bosses

Team bosses Craig Pollock and Eddie Jordan warned on Friday that Formula One cannot avoid the recession that is hitting the world following the terrorist attacks on the United States on September 11.

British American Racing chief Pollock has revealed that a number of potential sponsors he had in line for next year are pulling the plug on their activity and he is calling for all teams to discuss sponsorship matters.

"We have felt the effect," Pollock said. "We've had sponsors we have been dealing with actually say that they are not going to come on board now because of it, even if they were small sponsors. I think every team really needs to reflect on what has happened because it is going to affect the whole of Formula One.

"I think it's going to be harder and harder to fill up the sponsorship books, and the teams should be getting together to discuss it."

Jordan, meanwhile, predicted that a budget cut of around 50 per cent could be needed for teams to avoid major financial problems and he believes that the bigger teams have to take on a lot of responsibility.

Jordan claimed that the likes of Ferrari and McLaren have got to ensure smaller teams do not go out of business as they strive to reduce the gap to the top two, and recalled the early 1990's when a host of teams folded under financial strain.

"I think exactly what Craig has said is true and it would be preposterous for us in this sport to think we are immune," Jordan said. "Everyone else can cut budgets by 20, 30, 40, 50 per cent. It's not just because of September 11, I think it's been on the cards for some time. The world is in recession and we are not recession-proof.

"We will suffer the penalties and one of the things that I remember and probably Craig luckily enough doesn't, was in the early nineties when I came to this sport there were 18 teams and in '93 or '94 there were nine or ten.

"We mustn't let history go amiss at this stage and go clear over our heads. I think, with the greatest of respect, and Ron (Dennis - McLaren boss) can answer this, I think there is immense responsibility on teams like McLaren, Williams and Ferrari, to guide us through.

"People who will suffer least will be them because they are the successful ones, but if we want to have a strong, meaningful Formula One Championship for years to come, we need to make prudent steps that encompass the crisis that we are about incur. That's where we come from. It's down to Ron and the boys."

But Dennis has said that McLaren are as susceptible as any other team on the grid, and admitted that he already has potential sponsors for next year re-evaluating the funding they will commit to Formula One.

"No one is immune - you're in business - no one is immune to what's happening," Dennis admitted. "Share prices have gone through the floor, companies look immediately to their advertising budgets and that, ultimately, trickles into motor sport, and it does trickle.

"We tend to be last in and last out of any recession, and that's going to happen this time round. Whether all the teams will survive you will have to wait and see. The big teams are just as exposed to this as the smaller teams. We've got sponsors who were on the brink of commitment and have pulled back and are re-evaluating where and how to spend their money, what they have of it.

"So Formula One is going to be no different from any other business. It's going to be a tough time. The problem with Formula One, when you go down that path, and it's a path we have to go down, the teams traditionally spend the money they've got."

Dennis is doubtful that teams will reduce their budgets for next year, and claimed that the 11 teams on the grid will use all funds at their disposal in a bid to move up the grid.

"The only way that we economise is that we are forced into economies," he said. "Whether we, all the teams, are genuinely prepared to cut their cloth and cut their budgets, I doubt it. They will spend what they've got, they always have and they always will."