The art of war

When Cosworth boss Kevin Kalkhoven flew in to Imola to attend his first Grand Prix since acquiring the company from Ford last November, he was in for a rude surprise. One of the two F1 teams running on his V10s, Red Bull Racing, announced a new partnership with Ferrari for 2006. To make matters worse, their other team, Minardi, was rumored to continue using the current spec engines (as per the provisions of the FIA).

With millions invested in developing the new regulation 2400cc V8, Cosworth suddenly found itself stranded. Even if Minardi were to switch to V8s, the costs would far outweigh the benefits – especially since the Australian team is a permanent fixture at the back of the grid.

As if this wasn’t bad enough, Kevin and company were not given any prior intimation by Red Bull. While Cosworth knew that its deal was for one year, and that Red Bull was considering alternatives, Kevin and team were flabbergasted, as they had specifically asked the team whether the trip would be worthwhile. Ironically, the latest Cosworth V10 performed far better than its recent predecessors, scoring points in every race till then.

So why did Red Bull ditch Cosworth?

To find an answer, one needs to go back a few months, to a time when a storm called GPWC started brewing. By the beginning of the 2005 season, it was clear to Bernie Ecclestone that the manufacturers’ group was serious about a breakaway series. If he fails to sign up at least some of the existing teams, Bernie’s highly valued F1 empire would turn hollow by the end of 2007. Something needed to be done to save Titanic.

From that moment on, everything Bernie Ecclestone planned and executed was straight from Sun Tzu’s ‘Art of War.’ Here’s a blow-by-blow account of what exactly happened.

Attack by stratagem
Supreme excellence consists in breaking the enemy’s resistance without fighting. Thus the highest form of generalship is to balk the enemy’s plans.

The first thing Bernie needed to begin his game plan was a powerful ally. So he and the FIA got down to work. Their target: Ferrari. After all, they are the only ones to have been part of the championship right from 1950 and are synonymous with Formula 1. But if Ferrari were so special, why would they concede? Because Ferrari is very unlike other car manufacturers. Selling just a shade over 8,000 cars a year globally, the team survives on racing success. Bernie knew this very well. And he knew something else. Ferrari’s parent company FIAT was in dire straits and the expected support from GM wasn’t coming anymore. So Ferrari needs Formula 1 as much as the sport needs Ferrari. Bingo!

Luca di Montezemolo promptly signed the new Concorde Agreement. When the news broke, there was pandemonium. The other members of the GPWC were understandably miffed with Ferrari. With industry heavy weights like Renault, BMW, Honda, Mercedes-Benz and Toyota in the opposition, it was going to be a bloody battle.

In all fighting, the direct method may be used for joining battle, but indirect methods will be needed in order to secure victory.

To everyone’s surprise, Red Bull Racing was reined in with an engine deal with none other than Ferrari. Red Bull’s acquiescence was quickly rewarded with a change in the third driver rule. Soon Jordan fell in line too. Then a minor but well thought out provision in the 2006 F1 Regulations, which would allow teams with scarce financial resources to run cars on the 2005-spec V10 engines, took care of Minardi and its rebellious boss. Meanwhile rumors of Sauber’s take-over by BMW strengthened by the day. This was good news for Bernie as it meant a potential addition to his camp in the form of Williams.

Disciplined and calm, to await the appearance of disorder and hubbub amongst the enemy – this is the art of retaining self-possession.

Despite having two top-class drivers, Williams F1’s 5-year partnership with BMW clearly did not fulfill expectations. This is where Cosworth comes into picture. After all, they powered Williams to their first three World Championships. The scenario is perfect. Unlike Renault, Mercedes-Benz, Toyota and BMW, Williams is not a car manufacturer. Neither is McLaren. So it makes absolute sense for them to stick to Formula 1, the sport that defines them. Bernie even made a point by sending out a signal through Max Mosley, who said, “I would guess that at the beginning of 2006, the most obvious commercial manufacturer, Cosworth, might even have a substantial advantage because they have an enormous pool of data on V8s and all the problems with V8s that other people don’t have.” Frank Williams and Ron Dennis surely got the drift.

The Use of Spies
What enables the wise sovereign and the good general to strike and conquer, and achieve things beyond the reach of ordinary men, is foreknowledge.

The dust has long settled on the BAR Secret Compartment issue. But what made the FIA technical delegate Ed Bauer to delve into the innards of the 007’s fuel tank? During the ensuing drama at the International Council of Appeal in France, he conceded that he had first become aware of this extra compartment at the Malaysian Grand Prix. But what FIA President Max Mosley said let out the cat. “What actually happened was that there was a general rumor in Formula One that this was going on. And whether it was or not, I don’t know. I personally heard about this during the winter from someone who doesn’t work in Formula One but works at top-level motor racing more in connection with the United States.” Neat. But why was only BAR scrutinized? Who are we to ask!

Waging War
The captured soldiers should be kindly treated and kept. This is called, using the conquered foe to augment one’s own strength.

BAR were not found guilty of ‘fraud’ but were punished for ‘lack of transparency.’ For a prestigious company like Honda, this was a definite reprieve. Expulsion from Formula 1 would have damaged its image considerably. However, what’s worth noting is Bernie’s claim at the Monaco Grand Prix – “Max took a hard line on BAR and wanted them thrown out of the entire Championship. I told him to come back from that a bit because I was worried Honda might leave the sport. I asked him not to go for an entire season’s ban because it would also not have been good for the sport.” His benevolence seems to have worked, as BAR dropped its planned legal crusade against FIA and rival teams who had quickly swapped their fuel tanks.

Weak Points and Strong
All men can see the tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.

The media blindly refers to Bernie Ecclestone and Max Mosley as two conflicting forces. In reality, they are like two sides of the same coin. They are simply playing ‘good cop bad cop’. However, it was Bernie’s avarice that sowed the seeds of GPWC. And the banks have slowly but surely wrestled control of the sport from him. Or so they thought.

Just before the Monaco Grand Prix, Max Mosley stunned everyone by offering his buddy Bernie Ecclestone a role in the FIA. If he accepts the offer, Bernie will have to divest himself of his commercial interests in the sport. So is Bernie finally retiring? Not by any means. The banks, with hardly any experience of managing a sport of such proportions, would find F1 to be a rudderless ship in turbulent waters.

So even if Bernie moves to the FIA, one of the following scenarios is bound to crop up:

Scenario 1: Manufacturers take control of the commercial side of the sport. However, the teams and manufacturers would still have to deal with Bernie.
Scenario 2: Seeing the man they saw as ideal to run the sport leave, the banks may be forced to sell their stake back to Bernie’s SLEC, probably for peanuts.

Conclusion: Heads or tails, Bernie is going to win.


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