Despite reigning as champions in last year’s F1 constructors’ championship, McLaren isn’t going to be the highest earner in the F1’s prize money payments for this year. The intricacies of F1’s monetary distribution system involve a complex set of factors, several of which stretch beyond single-season performance. Notably, Ferrari, owing to its historical significance, receives a longstanding bonus, along with additional payments for success over the past decade.
Digging into these complex calculations, it appears that McLaren, despite its recent championship, will only rank as the fourth highest earner. Unfortunately, the specifics of the prize money structure, part of the confidential Concorde Agreement, are not available for public knowledge. This lack of transparency makes it challenging to provide a completely accurate table of payments, information known maybe only to FOM itself.
Despite the secrecy, the release of certain elements of the prize money structure since the current Concorde Agreement was enforced in 2021, gives us a chance to make educated estimates. For instance, F1 owner Liberty Media, as part of its official accounting, releases the total payments made to teams each season. The 2024 season saw a 4% increase from the previous year, with teams receiving a combined $1.266 billion, which represents approximately 61.5% of F1’s Operating Income Before Depreciation and Amortization (OIBDA).
Ferrari, the longest-serving team in Formula 1, has some unique benefits, including a veto over technical changes and an additional payment acknowledging its historical significance. This bonus is believed to be around 5% of the entire prize fund, although it can escalate if F1’s commercial income exceeds a certain threshold.
Additionally, there’s a separate column of payments, accounting for about 20% of the total prize fund, designed to honor teams’ past championships. This incentivizes consistent high performance over the long term. Over the past decade, five different teams have finished in the top three, with bonus points distributed based on their positions.
After accounting for these initial payments, the remaining 75% of the prize fund, approximately $949.5 million, is distributed among all the teams according to their finishing positions in 2024. Though the exact percentages are unknown, there’s believed to be roughly a 0.9% difference between each position.
Summing up all payments, we can illustrate a rough estimate of the total prize money payouts for 2025. While these are not officially confirmed, they demonstrate a fascinating dynamic. Ferrari remains F1’s top earner, largely due to its historical privileges and past dominance. McLaren, despite its recent victory, falls behind due to the previous dominance of Mercedes and Red Bull, who continue to reap the financial benefits of their past successes.
