Features - News Feature

JULY 8, 1999

What really happened at Honda Racing Developments...


Way back in 1962 Soichiro Honda set his engineers the task of building a car and an engine that would win in Formula 1.

Way back in 1962 Soichiro Honda set his engineers the task of building a car and an engine that would win in Formula 1. It was a great dream but not an easy challenge. In 1964 Honda arrived in Grand Prix racing with its own chassis, its own engines and its own ideas. The engines were great but the chassis were not and after a less-than-successful campaign - which resulted in only two Grand Prix victories - the company withdrew at the end of 1968. The F1 engineering team was put to work designing the Honda Civic, a car which would establish the company as a major player in the automobile business. Honda would eventually step down as chairman of the company but his engineers from the elite Honda Research & Development department followed his footsteps, keeping the founder's dreams alive. In 1983 Honda - keen to create a new image for its cars - decided to return to F1. This time it was decided that it would only build engines. The project, headed by Honda R&D boss Nobuhiko Kawamoto (who had worked as an engineer on the original F1 programme in the 1960s) was a huge success with Williams and then McLaren and propelled Kawamoto to the Honda presidency in 1990. He remembered Soichiro Honda's dream and began discussions for the company to build chassis.

But the timing was wrong. Honda had other priorities. The American markets were booming - Honda was selling two cars in the US to each one in Japan - and in 1993 sold more cars in the US than everyone except General Motors and Ford. Elsewhere the picture was less rosy. The company had to be restructured. Money had to be saved. The F1 programme was axed. To support the US market push it was decided that there would be a Honda Indycar programme.

Even if he had had to give up F1, Kawamoto allowed his engineers from R&D to build and test a Honda-Honda F1 car. He drove it himself at the Tochigi test track in 1992. It taught the company that building F1 cars was not as easy as had been thought.

But, being a racer at heart, Kawamoto wanted to go ahead with an all-Honda programme. His aim was to establish a team in Britain, employ European experts to build prototypes and then gradually drip-feed japanese engineers into the programme. Kawamoto planned for the team to be fronted by Japan's most famous racer Satoru Nakajima.

At the end of 1995 there were the first reports of a Honda F1 comeback and soon a member of the Honda Motor Sport Department began to appear at races. Yoshinobu Noguchi was not a big player within the Honda empire but he was acting as the eyes and ears of Tokyo. Through the summer of 1996 there were lots of rumours of deals with Tom Walkinshaw, Benetton and others but no-one was sure what would happen. And within Honda opposition was growing to Kawamoto's dream. The Honda Motor Sport Department which argued that it was too ambitious a project. The best way, they argued, would be to buy an existing F1 team and allow the Honda chassis men to learn from the Europeans and reach a competitive level before it became a fullblown Honda operation. It was the safe option and was supported by Hirotoshi Honda - the son of Honda founder Soichiro. The Honda family still controls a big shareholding in the company and so Hirotoshi Honda - who is also the boss of Mugen - is an important voice.

Honda North America wanted nothing to do with F1. It was of no value to them at all.

But Kawamoto was in charge and so plans for a Honda team were drawn up. At the same time there were talks to buy Jordan. A deal was agreed but it fell apart when Honda insisted that Eddie Jordan could not stay on as team boss. Eddie and Honda agreed that the team would have engines in 2000 and 2001.

The collapse of the Jordan talks meant that Kawamoto's plan was able to go ahead. This was to involve Dr Harvey Postlethwaite and many of his engineering staff from Tyrrell. The team had been bought by British American Racing at the end of 1997 and the 1998 season was to be the team's last. Recruitment was easy and during the summer of 1998 one engineer after another slipped away from Ockham and went to work at a secret design office which was housed in Dorset House in Leatherhead, Surrey. It was called Honda Racing Developments Ltd. They began designing a Formula 1 car which would be built for Honda by Dallara Automobili at Varano in Italy.

The work was already well-advanced when what seems to have been a management coup toppled Kawamoto. It was announced that he was retiring to be replaced by a man of his own generation Executive Vice President Hiroyuki Yoshino. It was a strange move but whatever battles there had been in the Honda boardroom remained a secret.

The removal of Kawamoto had a dramatic effect on the F1 plans although the head of Honda R&D Takefume Hosaka and his engineers pushed ahead with the original plan, sending engineers to Europe to learn as the chassis were designed and built. Recruitment to HRD was delayed because many of those who were to join were still at Tyrrell where BAR was offering a large end-of-season bonus in an effort to stop losing staff.

The question which began to loom ever larger was whether or not the team would be ready for the 1999 season. HRD argued that it was possible, Honda was cautious. On the day after the German Grand Prix the principal players in the Honda drama gathered at the company's Cricklade factory, near Swindon in England. The meeting lasted 11 hours, during which all the arguments were put forward and discussed. It was decided that it was simply too risky to go ahead in 1999. The news was delivered to Bernie Ecclestone and the F1 team bosses - who had agreed to leave an entry open for Honda - agreed that this would be put back until the 2000 season. It was a generous gesture by the team chiefs although some argued strongly that Honda should be given no concessions. They were overruled. F1 wanted Honda.

One of the biggest problems discussed at Cricklade was that most of the important recruits for HRD would remain under contract to Tyrrell until the end of the F1 season. They would arrive too late to make the project viable. Some jumped early, a major turning point coming at the end of August when Rupert Manwaring left Tyrrell and began setting up an HRD factory in Bracknell, Berkshire.

It was a curious time as both the Jordan and HRD men were confident that they had secured the factory Honda engines for 2000. All admitted that nothing was completely decided.

As soon as Tyrrell closed around 60 of the staff moved from Ockham to Bracknell. They worked fast and by the middle of December the first Honda prototype car was running in Italy. A couple of days later Honda President Yoshino announced that Honda would have its own team in F1 in 2000 and that it would build its own cars. It seemed that he too was following the Kawamoto plan.

The problem was that budgets had not been agreed and that was not easy as Honda North America was oppose to the whole idea. The Honda board of directors - which had to make the decision - was stuck in the middle. And the board was worried. If the company went ahead with the HRD plan how could it control the costs? The pressure to win would be such that there was a danger that the budget would go out of control. There was also worries that the company was getting into an area which the engineers did not fully understand.

Although they were fighting, neither Honda R&D nor the Motor Sport Department wanted the F1 project to be axed but to get the go ahead the support of Honda North America was necessary. This was made easier by the announcement in December that F1 had agreed a deal to race at the Indianapolis Motor Speedway in 2000.

While this was going on BAR had realized that the Supertec V10 engines to which it was committed were not good enough. They would not win races in 1999 and would be even less competitive in 2000. The new team needed results to keep British American Tobacco happy.

It was time to play double or quits.

BAR - egged on by the Motor Sport Department - began pitching for a deal, offering Honda a massive financial package - bigger than any engine deal in the history of the sport. The sums involved are played down - and even denied - by BAR but there is no doubt that the money made Honda stop in its tracks. The F1 programme could go ahead, funded by an outside organization. It allowed an involvement in F1 without the financial risk. Negotiations resulted in a proposal which included a long-term option for Honda to buy BAR so that the Honda-Honda dream could continue. It was a compromise.

But agreement was still needed. Some skillful politicking put Honda R&D onto the defensive at an important Honda board meeting in March 1999. What, argued the rivals, were the costs in a worst-case scenario with HRD? The result was that R&D had to prepare budgets which were hugely inflated from reality. Faced with these the Honda board decided that HRD was simply too expensive. HRD's Harvey Postlethwaite flew to Japan to try to save the project, convinced that Honda was making a mistake.

On April 5 he sent a letter to Hosaka outlining a plan to save the team.

"I wonder if your fellow directors appreciate what a valuable asset they have in HRD," Harvey wrote. "To set up a team from nothing, obtain an entry in the World Championship and build a competitive car in under a year is not only a major achievement but has given Honda a start in F1 which will probably never be repeated. It is clear that the board is genuinely uneasy about taking the plunge into F1 and therefore they may decide to stop the project or just revert to being an engine supplier. It is therefore in desperation that I wish to make the following proposal to keep alive the project."

Postlethwaite proposed that HRD be restructured as a private team called HRD International and enter the World Championship in 2000. He and the HRD management would buy 60% of the operation from Honda and find the budget to run the team. Honda would supply free engines and retain the right to buy back the team whenever it wanted.

Harvey argued that this would provide Honda with a more gradual entry into F1, would ease the pressure to win, make for a smaller budget and make use of the investment made and the work done.

"I make my suggestions so that your board has a more logical alternative than merely giving its superb engine technology to another team in which it has no interest or control which has been a problem in the past".

In fact HRD already had a $40m operating budget ready - from Mild Seven.

But the Honda board was still stalled because Honda North America would not agree to an F1 deal.

The HRD management waited for a response from Japan. They went testing in Barcelona and it was there on April 13 that Postlethwaite died on a heart attack.

For nearly two weeks HRD heard nothing from Japan. In that period there was intense activity to persuade Honda North America to vote for an F1 programme.

Exactly when and why Honda North America boss Koichi Amemiya changed his mind is not clear. But he did. The vote swung in favour of BAR and the deal was agreed in the days before the San Marino GP in Imola.

The HRD dream was dead...