F1 Tightening Up On Budget Cap Loopholes

Formula 1 is taking steps to tighten the regulations surrounding its budget cap, with these changes slated to take effect in 2026.

Contrary to the initial belief that expenditure restrictions would lead to a reduction in team sizes, the reality has seen an increase in staff numbers for leading teams, rising from the already substantial figures reaching as high as 1000 employees.

“The top teams are now employing 1,500 people without the engine department,” one team boss told Germany’s Auto Motor und Sport.

The rising numbers are because of a loophole in which some full-time staff are now being moved to part time – because only some of their income then needs to be counted.

As for another loophole, the magazine noted: “Suddenly, Formula 1 teams are building bikes and boats.”

For the swelling staff member loophole, a solid rule will be added to the 2026 regulations requiring that 100 percent of each staff member’s pay counts towards the cap.

“This is a real step towards more fairness,” Williams boss James Vowles says.

But there are other loopholes too – like staff members being shuffled between two partner teams, most notably Red Bull Racing and the newly-rebranded RB team.

RB team boss Laurent Mekies denies any wrongdoing. “We have agreed on individual work bans in consultation with the FIA,” he insisted.

FIA sporting boss Nikolas Tombazis confirms: “Going from a large team to a small team takes (a staff member) three months, and the other way around it’s six months.”

These arrangements between ‘friendly teams’ like Red Bull and RB, however, involve voluntary agreements. Tombazis responded: “If such a move takes place between two friendly teams, we will look particularly closely at it.

“In any case, quickly switching back and forth between two racing teams is prohibited.”