Mercedes employs financial analysts to evaluate the worth of each F1 car component

  • 2257
© Formula1

To ensure it gets the most out of each Formula One car improvement and keeps within the financial cost cap constraints this season, Mercedes employs financial engineers to evaluate it.

Mercedes uses financial engineers to evaluate the value of every component of an F1 car. In 2021, a team cost cap was implemented by F1 and set at $140 million for 2022. An additional $1.2 million was added for having more than 21 races per season and additional costs were permitted for sprint races.

The three biggest teams in Formula One—Mercedes, Ferrari, and Red Bull—have seen their spending curtailed most by the team cost cap, although all teams have had to keep costs under control to avoid potential penalties for overspending.

Mercedes team principal Toto Wolff claims that the team is deploying financial engineers to account for its updates during the season in order to maintain a strict eye on its spending on F1 car development and improvements.

Accordingly, Wolff said, "We have a tracker with finance engineers that track every single operation and every single element that gets into the car."

"So when we take things out of the truck, the financial engineer notes, the value. When you utilise it's being counted for.

"You are following this trend, like we have planned. We didn't bring a lot at the beginning but it's coming steady now."

Adjustments for inflation and rising costs have been permitted for this season with a 3.1% increase, despite the fact that F1 teams have been operating under a cost cap since last season, the beginning of a three-year glide path to a locked in and stable team budget.

The major worry among F1 teams was how the FIA would monitor and adjust for changes, as well as control and penalize those who over the budget cap, but Wolff is still satisfied that the right procedures are being followed.

"It was last year already [when the cost cap came in] and we will have the results whether everybody adhered to the rules of last year and the reports are going to come out," he said.

"So I think you know, you can't get that wrong because if you're breaking the rules, in the same way you do when breaking the rules on technical stuff."