Honda website
Honda website

JUNE 2, 2006

A Williams-Toyota deal for three years?

The word from Japan is that Williams will soon sign a three-year deal to use Toyota engines in Formula 1. The stories suggest that the team will be paying a nominal fee for the Cologne-built V8s.

The big question is what constitutes a nominal fee in F1 terms. Some stories suggest that it will be almost nothing but we have also heard that the team will have to come up with something in the region of $10m a year. This is not much, particularly given the increase in income that is coming from the new commercial agreements that have now been put in place in recent weeks and with the team's potential for sponsorship deals if it can produce better results.

The deal is a shrewd one as it secures the team's future in the mid-term and opens the way for a closer relationship in the longer-term if Toyota at some point decides to give up running its own team. At the same time, if Toyota is winning, Williams will not be far behind so the team will have a solid base one way or the other and that will help to encourage more sponsors to support the team, particularly given what has been achieved this year with Cosworth engines. The team may not have won anything but the level of performance for a small team has been impressive. A link with Toyota makes a lot of sense for an independent team such as Williams as the Japanese firm is the world's most successful and most ambitious automobile company and is aiming to be the top car company in the world within the next few years. It also has the deepest pockets.

For Toyota there is little to lose from the deal as winning with Williams or winning with its own team is much the same thing, if one looks at F1 from a big picture perspective. It will also help to motivate Panasonic Toyota Racing to do a better job. Our spies in Japan say that the deal will see the engines badged as Lexus V8s, a move that makes a great deal of sense from a marketing point of view.