Can Formula E prevent an arms race?

Formula E is an enviable championship in the modern motorsport landscape.

It has done a fine job so far to achieve a great many things as a nascent series, blending new technology, cost caps, top drivers and cool street circuits into a legitimate and entertaining racing spectacle.

Most conventional series would kill for any combination of the factors above, and FE is rightly gaining plaudits for what it has achieved so far.

But with great success and growth invariably come great challenges, particularly for a series still finding its feet.

Beyond having a season-three calendar still very much in flux, one challenge that should be rapidly making its way up FE's list of priorities is cost related.

The bedrock of the series so far has been intense competition between so-called manufacturers using similar technologies. I write 'so-called' because the term 'manufacturer' is given to any team homologating its own technology and there are three independents doing exactly that.

But soon I won't have to write 'so-called', because the incoming Jaguar entry and serious interest shown by BMW and Nissan proves FE has a manufacturer appeal like no other series right now.

Nine out of 10 teams running manufacturer alliances, as could conceivably be the case as early as season three, is a killer strike-rate. But the choice of 'killer' in that phrase is very deliberate because if the championship isn't careful there's every chance its manufacturer magnetism could be flipped into a negative.

For season two, manufacturers of powertrain technology have gained the ability to develop their own motors, gearboxes and inverters. With that comes the ability to also adjust the rear end, with teams getting freedom when it comes to dampers and springs. It's new technology meets old-school engineering know-how.

Renault has stolen a march in terms of performance, spending a paddock-estimated €10million, but it's not been to the series' detriment in terms of on-track entertainment - Abt Audi Sport's Lucas di Grassi leading Renault e.dams' Sebastien Buemi in the drivers' championship is testimony to that.

But what happens when more manufacturers come?

Autosport revealed last month BMW and Nissan are in talks to join the series, possibly as early as next season in a commercial tie-up capacity, before fully-fledged entries in the future. They'd join Renault, Mahindra, DS, NEXTEV, Venturi, season-three addition Jaguar and Audi (which is linked to Abt).

No disrespect is intended towards the EV specialists or emerging brands, but massive credibility swiftly follows in the wake of big companies who have real motorsport pedigree as well. As does the potential for serious technological advancements... and big budgets.

So far FE has kept things under control as well as possible by stringently sticking to cost caps. The chassis is €270,000. The battery is a similar cost (with an extra €100k for support). Powertrains built by manufacturers are available to any team for €120k. A cost cap is also planned for when battery competition opens up too.

"That's what makes the common sense kick in," series CEO Alejandro Agag says.

"Sustainability is covered. In F1, the powertrain equivalent is Manor could buy a Mercedes engine of next year at £0.5m. That would bring competition. Mercedes would be happy because Manor would win with a Mercedes engine and everybody would know so they would get the credit."

True enough, but only for now. The powertrain cost cap is a short-term measure limited in its use. Team Aguri is poised to confirm it has used it to snare the performance-leading Renault Z.E.15 for a snip.

But when the manufacturers come in, are they really going to want to put their name on someone else's technology?

Nissan might, thanks to the company's alliance with Renault, and you can add two and two together yourself regarding which team the Japanese marque could be partnering in the near future.

It's unlikely to be the case for the others. FE's appeal to manufacturers is primarily the ability to be seen to be involved in electric vehicles (like Jaguar for example), to prove their worth (lesser-known-to-the-wider-world makes like Venturi apply here) and maybe even learn about electric vehicle technology for road-car ranges (step forward Mahindra).

Using someone else's powertrain or battery compromises at least two of those factors. So BMW isn't going to buy a Renault powertrain. Which, hypothetically, means Renault is more likely to invest more into its product, and BMW is going to invest plenty in its own.

That process has already started, because Renault has set the bar and Jaguar is joining in season three. To think that isn't going to increase investment is naive.

Open battery competition is arguably the crucial factor in terms of the cost of being competitive in FE further in the future. But while it's easy to make a comparison to Formula 1, where manufacturers have always adopted their own engine programme over time, it's not a guarantee that manufacturer status in FE will automatically lead to a bespoke battery programme.

Agag claims the discussions the series has with companies interested in competing suggest a technical free-for-all is not necessary to lure them. This is why even in what is essentially an embryonic phase for the championship, it's already racking up manufacturer entries and interest.

"Before we make the decisions, we consult with the potential manufacturers," he explains. "We give them information and get their feedback.

"To have your own motor, branded with your name, is fine. The car is yours.

"I think the manufacturers are finding enough freedom on the powertrain side without the battery."

NEXTEV is a useful case study here. It's not a BMW or a Renault, and isn't swayed by long-standing rivalries.

"The consideration for us is we're a start-up enterprise working on a massive range of things," explains company CEO Martin Leach. "It's not a matter of whether we could but whether we should build a battery.

"FE can't just be a money pit for manufacturers. Competition improves the breed but manufacturers have billions they spend on R&D so they don't need FE to develop batteries or MGUs.

"It's one thing to say you're trying to develop new technology but if you lose sight of the fact you're trying to create a show then you will fail."

The universal message in the paddock is that keeping things close is important for FE. Delaying battery competition stops big marques ploughing big money into tech now and decimating their rivals in season five. And a new common battery will come in then and in theory be up to the same technical standard as anything that is going to appear once that side of things is opened up for season seven, as is expected.

This presents a competitive solution that also makes sense commercially, which is why the championship has avoided going down the route of open warfare. Manufacturers like DS, Mahindra and Renault are all keen on producing their own batteries but recognise it might not be in the best interest of the championship.

"I think we're actually succeeding in putting together the most difficult thing in motorsport, which is cost control," says Agag. "It was fantastic to see how the whole paddock agreed on the direction on the roadmap.

"It wasn't an easy decision because you sacrifice some things but everyone agrees cost control is essential. It's the base for the future success of the championship.

"The important thing is success here mustn't be related to money. It must be related to excellence in engineering, teamwork and set-up and driving skill. Those are the elements. We would like everyone to invest the same amount and then the best wins."

Intentionally or not, Agag hints here at a future for FE where budget isn't an issue if every team is a manufacturer. How much does it matter if budgets creep further and further into the tens of millions, if all of the teams bring factory funding? As Agag admits, "it looks like we're going to 10 manufacturers".

But, he continues, "The manufacturers don't like to lose..."

And that's another issue: someone has to finish last. So while it's conceivable FE could have a complete manufacturer contingent before too long, how long that bubble lasts is anyone's guess. Look at Honda's shortlived stint in F1 after it bought BAR but failed to find success.

Yes, this isn't F1 and the budgets aren't comparable, but there's still an impact and it's all relative. If BMW, for example, was spending tens of millions to have its electric technology beaten by half a dozen other major manufacturers, there's a serious hit to its image to consider.

"And then they go bust," Agag points out. "And you don't want that, you want to keep your teams healthy."

Maybe FE's existence will be glorious but shortlived. Maybe it will have a prolonged period of relevance with manufacturers funding the adoption of more and more aggressive electric-vehicle technology.

If that's the case, FE can only control so much. It's heading in the right direction by eliminating open chassis competition from its short-to-mid-term future. That keeps staff numbers down, and while R&D can't be capped (meaning manufacturers can push the boat out on batteries or powertrains if they see fit) it stops FE falling into an F1-style trap of windtunnel use and aerodynamic development.

The nature of the motorsport beast means the more manufacturers come in the more money is available to aid the cause of winning. That is why it is such a fascinating time for FE, because even though it comes with a risk it's impossible not to find the concept of a full grid of manufacturers going head-to-head in a real technology arms race incredibly enticing.

Maybe a spending war isn't inevitable but what's certain is FE's momentum is taking it towards a future as a series for the big guns.

When they arrive, the championship could rapidly reach its zenith - it just needs to be wary of friendly fire.