Mercedes in financial problems

[Derek Smith]

According to a report in F1-Line - http://en.f1-live.com/f1/en/headlines/news/detail/... -
Mercedes are losing €1billion a month and, it would appear, are looking at all sorts of ways of cutting costs. They are contracted for all races this season but it seems an odd time to suggest that they might not stay in the sport. A threat to Mosley? A threat to FOTA? Or, perhpas, McLaren?A bit too deep for me, I'm afraid, but something generated that little interview and the throwaway line.

Mercedes have a major stake in McLaren but with the move to manufacturing sports cars one wonders if they see the strength of McLaren in that area.

Whatever, it is a worrying time.

[Mike400]

early days - they are committed to the rest of the season at least, but I cant help feeling that mclaren's poor performance this season wont help convince mercedes to hang around...

What would this mean for those teams running merc engines? would it be a honda style complete pull out from the sport or would they stay as an engine supplier?

[Nick M]

I thought that the McLaren team (whichever bit Mercedes have bought into) were profitable, although I guess that may be because of funding from Mercedes. But I'd expect that to be reduced with the cost cutting measures which are being rolled out. And they can't be blind to the bad press / missed opportunity that Honda has just endured - if anything, Mercedes have some positive press out of that with their engines being seen to be good enough to win races.

Granted the current McLaren is a bit of a dog, but apparently it's fixable once the aero group open their eyes and spot the obvious. There was reference to this in last week's Autosport I think, about how it's something obvious and not something needing a fundamental re-design.

So, I guess the only reasons I can see them pulling out are:

a) damage limitation following the bad press from the recent porky pies debacle, although pulling out of F1 is likely to generate a whole different type of bad press.

b) to make a quick buck on the sale of their holding, but who's going to buy it at the moment ?

More likely it's just a 'never say never' type comment from Norbert Haug which has been blown out of all proportion. I'd have thought the DTM and F3 engine programmes might be the first to go if money was that tight.

But hey, if you're losing $1 billion a month, a few million spread over a whole year is a tiny drop in the ocean !

[rubystone]

Mercedes derive huge brand awareness from F1 - the McLaren ethos of quality really sits well with their own values and what's perfect is the fact that as F1 budgets are constrained, so their investment can be managed and trimmed. I'd be more concerned about BMW's long term F1 future than Mercedes'.

I do wonder just how long DTM in its current form will continue though - totally bankrolled by 2 manufacturers.

[skinny]

i don't think there's much concern about BMW, they use F1 very clearly for marketing support and technology links with their road cars, and are committed to racing. they say they can't imagine BMW without F1, and F1 without BMW. they also own the team and make their own decisions whereas mercedes don't. i think they will be one of the last manufacturers to fall if F1 does go that way.

picked this up today too...

internet said:

Also in the German press, experts and pundits are fearing the outcome of the FIA meeting on April 29.

Sporting sanctions may spark the already struggling Mercedes' withdrawal from the sport, while financial penalties would be disastrous amid the backdrop of the global recession.

Mercedes' racing boss Norbert Haug told the Cologne newspaper Express: "This situation is absolutely not positive for Mercedes.

"I report directly to Daimler chairman Dr Dieter Zetsche. If the situation should become intolerable, we will get together in Stuttgart and make a decision."

[rubystone]

It's not about BMW's commitment but about their ability to continue to invest in their F1 team given the current global financial crisis - they don't have as deep pockets as Mercedes do.

AFAIK Penske has nothing at all to do with McLaren nor Mercedes from a motorsport perspective, although given his widespread business interests I bet he has some commercial relationship with Mercedes.

[Rude-boy]

Gazboy said:

I wonder if Mercedes will tire of Max's medling in F1 and take Mclaren LMP1 & Indycar racing intead?

Silly question -does Roger Penske have anything to do with Mclaren?

I can't recall any direct current relationship between him and 'modern' Mclaren. That said he almost certainly still has strong links with Merc (remember their Indy engines) and with Mclaren from the '80's.

As we all know, this is one of those sports where who you know is all important.