With most of world sport currently on hold due to the coronavirus outbreak it is no surprise that certain sports are struggling. Football clubs around the world are currently facing months without income, with some lower teams already feeling the pressure. The European Championships and The Olympics has been postponed until next ear, and Formula One, a sport already looking to adapt to changing circumstances, has had to call off its races.
Coronavirus has highlighted how delicate certain sport’s organisations are and we expect some to face more serious financial problems when everything is back to normal. Formula One bosses are currently in the middle of talks on how to save money and cut costs during this difficult time.
Racing teams are currently split on how these plans should move forward, with some suggesting the budget cap of £143 million ($175m), which is scheduled to come into force in 2021 should be lowered considerably.
The budget cap is seen as a necessity in the face of race cancellations causing a significant drop in revenues.
A number of changes have already been agreed by both organisers and teams in order to help safeguard Formula 1, and ensure no team will have to drop out indefinitely due to the ongoing crisis.
Teams have agreed to lower the budget cap to $150m, but many feel that amount should be considerably lower. At least one of the major teams have agreed that the budget should be set much lower, even suggesting it go lower then $100m but other big teams are hesitant.
With teams currently placing staff on furlough and with no clear indication of when the coronavirus plans will lift and racing can get back to normal, further talks will be taking place over the coming months in order to establish a plan that all teams can agree on and will help F1 survive into the following season.