The consequences of going solo for snubbed Renault

Following McLaren's defection to Mercedes, Renault will head into Formula 1's new era in 2021 with no customer teams - and as the only manufacturer powering just two cars.

Flying solo is not what Renault had planned when it began negotiations with McLaren over an extension of the current deal beyond 2020.

In fact Renault wanted to forge closer links with its customer team, sharing facilities and - where the rules allow - parts and IP.

It was an all-or-nothing advance that McLaren rebuffed. Having analysed the pros and cons, team principal Andreas Seidl preferred a straight engine supply deal with Mercedes, and convinced his bosses and shareholders that it was the way to go.

So how will it play out for Renault? Supplying just two cars is not without recent precedent. Honda was a similar position in 2015-18, initially with McLaren and then Toro Rosso. But for Renault having no benchmark is an unusual situation.

Since initially tying up with Red Bull in 2007 (pictured below) it has always supplied at least one customer alongside the 'Enstone team', whether the latter was works supported or in private hands under Lotus badging (aside from a brief dalliance with Mercedes in '15).

The current three-year deal with McLaren was a marriage of convenience, but one that suited both parties. McLaren wanted to be free of Honda, while Red Bull was only too happy to leave Renault and join Honda - using Toro Rosso as its advance party.

On track it seems to have worked out well and McLaren has made clear progress, especially in 2019.

Renault F1 boss Cyril Abiteboul says he "absolutely" takes some pride from helping his firm's customer to move up the grid, even if it has become a direct rival.

"If I'm honest it's also a disappointment that there was not more consideration given by McLaren for what we were putting forward for the partnership," he adds. "I think we've delivered. It's not perfect, it's a sport, we all know that reliability has not been perfect.

"But [McLaren] moving from P9 to P4, we delivered. Our proposal was simply how do we build the next journey together? Maybe they will be P4, we will be P4, I don't know, but we're exactly at the same level, and the key question for us is not to fight between us, it's how do we bridge the gap to the top teams?

"That was the unique selling point of a Renault partnership together."

Renault was convinced that working more closely with McLaren was the best way for both parties to make that huge leap from being best of the rest to taking on Mercedes, Ferrari and Red Bull in a straight fight. It's a plan that had some logic to it.

"That was what we tried to develop with McLaren, and in fairness that was the spirit of the partnership when we first secured it," says Abiteboul.

"The expectations were different between McLaren and ourselves. It's not a criticism, it's just that we had a certain ambition to bring that relationship to a strategic level" Renault F1 boss Cyril Abiteboul

"If you look at what we said when we announced it back in Singapore 2017, I'm sure we talked about all those things that we could explore, that we've been unable to really unlock for lots of different reasons, because there is always some resistance on both sides. So it did not happen.

"We had another try, we had another go, on facilities in particular, on equipment, on all the parts that will be standardised or prescribed, to create all those synergies to try and reduce that gap to the top teams.

"But there was no appetite, which we understand, which we accept, and therefore we acknowledge that it's better to leave it like that."

Abiteboul says that discussions over a 2021 deal began some months ago, before McLaren began to fully focus its attention on a possible future with Mercedes.

"It's a process that started back at the French GP, when we started to have conversations about what could happen beyond the terms of our existing contract.

"The expectations for the partnership were different between McLaren and ourselves. It's not a criticism, it's just that we had a certain ambition to bring that relationship to a strategic level, which was maybe not the expectation or focus of McLaren at this point in their journey."

McLaren required only an engine deal, with no strings attached in terms of cooperation.

"They wanted a supplier," says Abiteboul. "And unarguably Mercedes is a very good supplier, and have a turn-key product, which would be done in accordance to Mercedes' standards, but also specification. And McLaren is just focusing on their chassis.

"And there is some logic in that. Our proposal was very much about a partnership in which we would share lots more, we would share lots about engine integration, chassis installation, but not just that.

"If you look where we're standing, we're very close to McLaren, there's nothing between us and them, but there is a world between us and the top teams. For me the objective of that relationship would have been to work on reducing that gap together, so creating more synergies, about equipment, about installation, about facilities.

"Also looking at the way F1 is going to develop, with standard parts, open-source parts, prescriptive parts, there were a number of opportunities to join together and while we compete on track also try to reduce the gap.

"That's why I was talking about a strategic partnership, which doesn't mean them becoming a junior team, or a B-team of Renault. Obviously that was not going to happen, so we didn't even consider or try that. But our approach was not really of interest for McLaren."

Abiteboul says Renault would have been better off in 2021 if the closer partnership had gone ahead - but equally it will not be worse off than it is now, as there has been no pooling of information under the current arrangement.

"We have no interest in a relationship that doesn't bring something to the party. If you get beaten you are a wanker, and if you're beating them, it's because your technology is not on a parity level. In all cases there's nothing in it for a supplier!" Cyril Abiteboul

"I think that we would have been stronger together, on the basis of our approach to the partnership. Without that we're weaker than we could have been, so in my opinion it's a lost opportunity.

"But it's not like it's something that's putting us in a massively different position from the position in which we are today.

"Right now there is nothing happening between us and McLaren on these types of things, so there is no change, no improvement, but there is no degradation also. We just have to get our act together and keep on working in the usual way.

"I accept that what we were proposing to McLaren was maybe a bit unusual - well not necessarily unusual, but trying to be a bit more open-minded about the way teams can cooperate.

"We've got the fantastic model of Haas and Ferrari, this was just a different model of collaboration between two teams.

"But we also know what we have to do, and we are completely geared up to being capable of working as a standalone team on all aspects."

Abiteboul admits that for a works team a demanding customer can be more trouble than it's worth - and with Red Bull, Renault has had plenty of experience of tension in such partnerships.

"We have no interest in a relationship that doesn't bring something to the party. From an economic perspective, it brings nothing, from a marketing and communication perspective, let's be honest, it's more negative than positive.

"If you get beaten you are a wanker, and if you're beating them, it's because your technology is not on a parity level. So in all cases there is nothing in it for a supplier!

"So on that basis we were not going to review our offer and try again to start thinking about subsidising the sale, because that was what it would have meant if we had to lower our price, given our cost base. That's not something we wanted.

"We've got a certain set of ambitions, we've got also confidence in the technology that we have started to develop for 2021, and if there is no particular appetite for a strategic partnership, we have no particular reason to share what we believe could be a performance differentiator in 2021."

While Toto Wolff has stressed that an extra customer represents a significant financial boost for the Mercedes HPP division in Brixworth, Abiteboul makes it clear that for him the loss of customer income from McLaren is not a concern.

That's because Renault's engine facility in Viry is structured differently, and it outsources and has to pay for the production of most parts - which means fulfilling a supply contract for two cars costs it more than it does Mercedes.

"That's why it's neutral from an economic perspective. You sell at the price of the cost of supply, and you know those transactions are not totally regulated, but there is guidance from the FIA regarding the price at which you can sell. Therefore that limits your ability to really make a profit.

"Mercedes has a very different model. Mercedes is completely integrated, so if you go in Brixworth you see plenty of machines, turning machines and milling machines and so on, so they produce a lot of their parts, whereas we have to buy everything from outside.

"What I suspect is that they expect basically their production to go down with the dyno restrictions [planned for 2021], which frees up some capacity on the production, which then is available for new customers.

"We don't have any in-house capacity, we don't have that problem and we don't have that opportunity either."

Those upcoming 2021 dyno restrictions arguably put more of a premium on having cars on track providing data - certainly Mercedes views it as a case of the more, the merrier.

Abiteboul concedes that fewer cars gathering mileage is a downside, but it's one he's prepared to absorb.

"I would prefer to have a larger footprint. But we're not desperate because there is such a maturity of the regulations that we don't think we need a running dyno like Honda is doing on a regular basis.

"We've reached maturity. We need to do better, and there are some important changes coming up for the four power units for 2021, but we think we are well-equipped with our dynos back at the factory."

An upside of having just two works cars to service is that you can react faster, because you have to make fewer new bits.

The FIA obliges engine manufacturers to make any new spec available to customers at the same time as the works machines. Mercedes made a huge effort to have six of its new Phase 3 units on hand at Spa - although two actually failed on customers - while Haas and Alfa Romeo have sometimes received Ferrari upgrades before the works cars.

"I understand why we are putting these extra constraints on the supplier," says Abiteboul. "But the more you put constraints, the more it discourages the supplier to continue to supply. In particular when we have the set-up that we have, because we are not integrated like some other manufacturers.

"And it's a logistic challenge to be able to comply with that regulation. I'm not even talking about the sporting opportunity, I'm talking about the production challenge that it creates when you issue a new spec to be able to make that spec available for eight cars.

"I don't want to be cynical on Mercedes and Toto, but if he wants to equip four teams, go for it!

"In our world that will slow down our development capacity - the logistic challenge would slow us down. He has a different world, a different industrial and production model. But I'm not totally convinced. We'll see the effects of that in 2021."

With no customer to please - and Abiteboul says that Renault's policy has always been to listen to its customers - Viry can concentrate all its resources on the requirements of the works team. There's only one installation, for example, and no need for dedicated dyno running for a customer's bespoke fuel/oil partner.

"In our DNA we always want to listen to everyone. But by doing that we sort of dilute the focus from the works team. And we do that because we have always done that.

"I've had clashes with my engineering people, because that's the way they want to deal with customer teams. And clearly not having to deal with any customer simplifies things a lot, you just focus on yourself, and that's it.

"And also thinking about dissemination of IP, if we were to continue with McLaren I would probably have to disclose the external envelope of the [2021] engine in the next few weeks, which frankly is something that I don't want to do. If I have no reason to do it, it's better not to do it.

"I'm sure it's going to be both ways. From having been in that process with Red Bull and Toro Rosso in the past, I know that at some point our engineers will be asked to leave the briefing room, and not to listen to certain channels. It's one of those things, we've been through that already in the past, and it's normal."

So what does having no customers say about Renault's future in F1? As with so many aspects of this story, there are two ways to look at it.

Some have taken Mercedes adding McLaren to its 2021 roster as a sign that Stuttgart eventually wants to stop its involvement as a works team.

Equally you could argue that by having no customers and no contractual commitments to fulfil, Renault now has an easy way out of F1 should its board get itchy feet - it would just have to secure a future for Enstone and its employees.

Abiteboul says Renault is fully committed, as long as the championship develops along the lines that the FIA and Liberty promise it will.

"Very clearly we are not any longer in F1 for the engine-supply activity," he says. "So supplying or not supplying McLaren is not going to turn things upside down.

"We will remain in F1, providing that it continues to make sense for the business, for Renault, from a marketing and a strategic perspective, and also because of the whole evolution of the sport.

"There is this important milestone of 2021, with the end of October. So now we will continue to monitor the evolution.

"Right now all the indications are pointing in the right direction, because it's all pointing to an improvement in the business case and the value proposition of F1 for teams.

"So if we are here today we have no particular reason not to be here tomorrow, provided that we stick to the principles that have been set out."