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Budget Cap Hits Red Bull’s Sergio Perez and Mercedes Hard as Formula 1 Season Nears End

Virgilio Machado by Virgilio Machado
January 9, 2025
in Motorsports
Reading Time: 3 mins read
0
Budget Cap Hits Red Bull’s Sergio Perez and Mercedes Hard as Formula 1 Season Nears End

BARCELONA, SPAIN - MAY 22: Sergio Perez of Mexico driving the (11) Oracle Red Bull Racing RB18 leads George Russell of Great Britain driving the (63) Mercedes AMG Petronas F1 Team W13 during the F1 Grand Prix of Spain at Circuit de Barcelona-Catalunya on May 22, 2022 in Barcelona, Spain. (Photo by Lars Baron/Getty Images) // Getty Images / Red Bull Content Pool // SI202205220689 // Usage for editorial use only //

As the longest season in Formula 1 history unfolds, both Red Bull’s Sergio Perez and Mercedes find themselves stretched thin. With a record-breaking 24-race schedule, F1’s strict $135 million baseline budget cap, adjusted slightly for inflation and the number of races, has exposed new challenges for teams navigating attrition and development costs.

Each team allocates funds for repairing and replacing parts to cover the typical wear and tear or damage from incidents. But with a slew of crashes and costly component issues, both Red Bull and Mercedes are feeling the heat as they approach the season’s end.

Red Bull’s Development Setback: Perez Missing the Latest Floor Upgrade

Red Bull recently introduced a new floor in Austin designed to improve high-speed handling and braking stability, producing more downforce than expected. While it hasn’t yet ended Max Verstappen’s grand prix win drought, it did help him capture the sprint race win in Austin and qualify on the front row in Mexico.

However, Perez is still using a repaired, older floor specification. Due to repeated incidents—most notably his crash in Monaco, his collision in Hungary, and his recent clash with Red Bull junior Liam Lawson—Perez has racked up significant damage this season. As a result, Red Bull, mindful of the budget, hasn’t supplied him with the new floor yet.

Perez acknowledged the impact on his performance, noting, “There’s something in it. Also a bit of weight… not ideal, but the team is doing the best they can. We’ve been affected with so many incidents, so the team is pushing flat out.” Perez may receive the upgrade for the Las Vegas Grand Prix, with Red Bull eyeing the gap between races as an opportunity to make the change.

Mercedes Grapples with Cost Cap After Costly Crashes

Mercedes is facing its own budget cap woes, having taken what team principal Toto Wolff described as “a tremendous hit” after a recent series of accidents. Notably, George Russell’s crash in Mexico led to an expensive chassis change and the use of a brand-new monocoque, an expense that would’ve been saved if it hadn’t been required. Additionally, Russell’s incidents at Austin and Monza further stretched the team’s budget allocation for parts, leading to what Wolff says will be a halt on new developments for the rest of the season.

“We probably have to dial down on what we put on the car,” Wolff said. “In cost cap land, that is a tricky situation… there is an impact on how many development parts we can put on the car, because the answer is zero.”

Mercedes has had to get creative in managing parts to minimize spending, even resorting to aerodynamics testing tweaks. Russell’s Austin-damaged floor has since been repaired, allowing both him and Hamilton to run the latest floor upgrade in Brazil. “We’re both going to be on the updated floor,” Russell confirmed, explaining that the minor variation in specifications is part of standard aerodynamic testing rather than an upgrade.

Teams Strategize as Final Races Approach

Both Red Bull and Mercedes will be pulling out all the stops in the season’s final races, with Red Bull looking to get Perez fully equipped and Mercedes creatively managing parts to minimize costs. The challenges underscore the reality of the new F1 era, where budget restrictions add a new layer of complexity to team strategies, forcing difficult decisions that impact the development and availability of crucial upgrades.

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