'We'll have to adapt': Red Bull Racing's F1 third place cost a cool R5bn
Red Bull Racing spent £237.3m (about R5.12bn) in finishing third in Formula One last season, and recognised “adaptations” would be needed to meet a $145m (R2.41bn) cost cap being introduced in 2021.
The Honda-powered team, one of two owned by the Austrian energy drink company, reported a profit of £618,000 (R13.3m) compared to a previous £923,000 (R19.9m) in the year ending December 31.
The expenditure compared to £239.6m (about R5.17bn) in 2018, when British-based Red Bull were also third and using Renault engines. Turnover was £245.4m (R5.29bn), up slightly from a previous £245.1m.
“Costs remain under control and the team is mindful of adaptations necessary for new FIA financial regulations coming into force for 2021,” Red Bull principal Christian Horner said in a note accompanying the figures.
The $145m cost cap is being imposed as part of measures aimed at creating a more level playing field for the 10 teams, but it excludes major elements such as driver salaries, marketing and travel. The budget cap drops to $140m (R2.33bn) in 2022 and $135m (R2.25bn) for 2023-25, which will mean big teams like Red Bull having to cut their spending while some smaller outfits still have room to expand.
Red Bull did not detail how much of the 2019 expenditure would be exempt from the cost cap. Horner said the team had examined the company's exposure to Brexit and had plans in place to enable operations to continue unaffected.
Champions Mercedes spent £333m (R7.19bn) in winning both titles last year but also reported a profit, according to accounts published last month.
Red Bull have Dutch 23-year-old Max Verstappen on a long-term contract, with UK-born Thai Alexander Albon his teammate, and are second overall.
Verstappen, the sport's youngest race winner, took three victories last year.