The Ecclestone Manouevre
MAY 16, 2003
The Mole wished, if only for a brief moment, that he had been in Montreal on Friday and Saturday. The weather was apparently very nasty and so perhaps the garden in Surrey was a better option but the excitement of the Friday press conference and then Bernie Ecclestone's exquisite political sidestep on Saturday made The Mole wistful for those heady moments of high drama. He would have loved to have been there and watched Ron Dennis spit out his line about Formula 1 not having "a soup kitchen" and Paul Stoddart's magnificent reply to Dennis's point that there was never any charity in Formula 1 as he calmly rolled out a whole series of examples of occasions when money had been paid to teams to help them survive and then the Minardi boss pointing out that The Fighting Fund had been Dennis's own idea.
And then suddenly a flustered Ron had begun to talk about "fiscal bridges" which of course are loans which have helped keep struggling teams alive.
Later when a journalist asked Ron to comment on the perception that a settlement was being blocked by Williams, Ferrari and McLaren, he remarked that the perception was "completely wrong" only to have Stoddart going into detail about who had signed the deal and who had not.
"Six of the team principals have signed to release that money today," he said. "Three, two that are sitting to the left and to the right of me and one in a red suit who is not here have not yet signed."
Toyota, he said, had not been involved. BAR and Renault had signed but there were conditions but apart from that the journalist's perception had been "spot on".
Ron looked rather uncomfortable.
Eddie Jordan was feeling so uncomfortable that he was actually quiet. And he tried desperately to drop the subject of the Fighting Fund.: "We are moving out of sport and into drama TV," he wailed. "It is not helpful because no-one is prepared."
But Stoddart was armed and dangerous.
At the back of room Bernie Ecclestone watched the whole battle and seemed to be enjoying it. Washing Formula 1's dirty linen in public is not necessarily a good idea but a little bit of controversy does no harm at all and as Ron Dennis, the leading man in the GPWC, was on the receiving end, it did Bernie's cause no ill.
One journalist was particularly tenacious in his pursuit of all of the team principals present, asking them why they were quibbling when they were really all partners in the same business and should be working together. No-one had a credible answer for that but they waffled about the importance of doing things in the longer term.
"But nothing is done," said Stoddart. "Talk is cheap."
But the best was yet to come. A few hours later Ecclestone asked Stoddart if he would be willing to sell him shares in Minardi. It was a masterstroke for Ecclestone appeared to be the presidential figure, the peacemaker in troubled times. In fact it was a magnificently self-serving move for in a flash Ecclestone had acquired a way in which to exert even more pressure on the teams. Bernie now has a vote on decisions which were previously left only to the teams. Unanimous agreement is now going to be more of a weapon than it has ever been before.
The teams, by refusing to help Stoddart, have tied their own hands still further.
The Mole will watch with interest to see what happens next. Ecclestone is not a man who goes into joint ventures he does not control and The Mole is completely convinced that Mr E has at least 51% of Minardi. Perhaps that will not happen overnight but there will come a point at which he will take control. Logically it might be the end of the year. After that we will see if Stoddart is still there. He seems to think that he will be but others say he is now dead meat in Formula 1 circles. The Mole cannot make up his mind.
Ecclestone likes to subject new team bosses to a certain amount of pressure in their early years, to see if they have what it takes to survive in the snake pit that is Formula 1. The Mole thinks that the Friday press conference may well have been Stoddart's trial by fire. He had the guts to do it and he did it well. He was measured and persuasive.
Bernie did not come to the rescue of Prost Grand Prix nor of Arrows F1, although he did dip into his pocket to try to help them out with "fiscal bridges" but both teams were heavily in debt. Minardi is not. The Mole knows that Stoddart owes some money to the Rumi Family from whom he purchased the team but there is a schedule of payments to clear that debt. There are a few small debts to suppliers but this is not the kind of mess that some of the other teams were in when they went down.
It is a perfect deal in so many different ways that when The Mole heard what had happened he chuckled to himself for a good half an hour afterwards. And on top of all the other things Bernard and Stoddart may also be able to do some deals on aeroplanes. Bernie needs Boeing 747s to fly the Formula 1 circus around the world, Stoddart has access to a handful of them. He has sold the airline he used to own but the deal is not yet completed and so things can change. Having access to some Jumbos could save a huge amount on the costs which the Formula One Group has to pay to air freight all the equipment around the world. These savings are unlikely to be passed on to the teams but they would certainly improve the profit margins of Formula One Management.
The Mole can imagine that before long we may start to see silver-grey Boeing 747s with F1 logos appearing in airports around the world: just the thing when F1 is planning to drop European races and do more flyaway races.
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