FILE PHOTO: Formula One F1 - Belgian Grand Prix - Spa-Francorchamps, Spa, Belgium - August 26, 2022 CEO of Formula One Group, Stefano Domenicali, FIA President Mohammed bin Sulayem, Chairman of the Board of Management of AUDI AG, Markus Duesmann and Audi Chief Development Officer, Oliver Hoffmann pose for a photograph as German manufacturer Audi announce they will join the Formula 1 World Championship from the 2026 season as a power unit supplier REUTERS/Stephane Mahe/File Photo
AUSTIN, Texas (Reuters) - Formula One's governing body has put 2026 entrants Audi on a more level playing field compared to rivals by introducing a cost cap offset to take into account higher wages in Switzerland.
Audi are turning Swiss-based Sauber, whose factory is at Hinwil near Zurich, into their works team when the sport starts a new engine era.
All teams are subject to a cost cap, set at $215 million for 2026 with a range of new items included in the financial regulations.
Seven of the 10 are based in England, where average wages in 2022 were $54,891 compared to $79,926 in Switzerland according to the Organisation for Economic Co-operation and Development (OECD).
Audi is making its own F1 power unit in Germany, where average wages in 2022 were $62,570.
The other two teams, Ferrari and Red Bull-owned RB, have their headquarters in Italy ($47,294).
English-based teams generally have an easier time recruiting staff from rivals without having to offer financial incentives because there is less upheaval for families than moving to Switzerland or Italy.
"It is our responsibility to also try to be fair," the governing FIA's head of single seaters Nikolas Tombazis told reporters at the U.S. Grand Prix.
"It became obvious to us that salaries in certain countries are much, much higher and the cost of life is much higher. I see it myself, I live in Geneva. Whenever I go to the supermarket I think about it.
"And we felt that for roughly the equal cost cap a team based in a high labour cost country like Switzerland would end up having approximately 30% or even 40% fewer people working on the car, which we felt was fundamentally unfair."
Tombazis said the difference meant teams like Sauber might eventually have to relocate from Switzerland "which we don't think is the right way for a world championship to operate".
He said the 2026 financial regulations would therefore adjust salaries included in the cost cap according to factors determined by the OECD data.
"We have overriding and compelling evidence also from what teams are paying their aerodynamicists or their designers or their shop floor workers... and all that points in the same direction," added Tombazis.
"Therefore I think this regulation is completely fair."
Sauber boss Mattia Binotto said the move was not designed specifically to help Audi.
"I think at least it's removed what could have been a disadvantage, so I don't think that will bring any advantage," he told Reuters. "I think it's a matter of fairness, so it's certainly welcome."
(Reporting by Alan Baldwin, editing by Toby Davis)
