Rumours of Audi pulling out of F1 before even starting in 2026, or equally bizarrely – handing over the completed project to Porsche – is a wholly unprecedented development in the history of the sport. Could it really happen?
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The tendency for factory teams to dip into and out of motorsport categories is as old as time. Most recently and unquestionably in this regard, Formula One’s most damaging post-millennial moments came in 2008 and 2009 when first Honda, then Toyota and BMW departed its travelling circus.
Citing the cash crunch as justification was an obvious and credible foil to brands relentlessly pumping in hundreds of millions in the face of continually elusive on-track success. As company boards shoulder responsibilities to deliver profits to shareholders, a dented bottom line against the tenuous marketing value of also-ran status as vanity projects (not to mention consistent public embarrassment) in the world’s most expensive sport – becomes an exceedingly hard sell.
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As textbook cases of responsible corporate governance, the examples are legion as the lesson is singular: the longevity of high-expenditure projects are wobbly at best without board-level support. Which is why – and fuelled by C-level management musical chairs at the Volkswagen Group in the past two years – the question marks emerging over the solidity of Audi’s alleged commitment to its planned entry into F1 before even taking to the track in 2026, have inevitably attracted the spotlight.
Show Me the Money
Given its rich multiplicity of brands and coupled with the credibility that participation would bring to the series, the Volkswagen Group have danced on F1’s radar for several decades. Still, corporate strategy, a commitment to maximising efficiencies, associated cost control and as well as undoubtedly the fallout from 2015’s Dieselgate scandal, have continued to hamper flirtations between the two.
The Group only finally committed in 2022 following ratification of the ruleset for F1’s next engine era that is set to commence in 2026; the former being headlined by amendments that were effectively conditional to the VW Group putting pen to paper. Specifically, the incumbent V6 hybrids’ pricey and initially-problematic MGU-K would be dropped in favour of the remaining electric component of the power unit ramping its contribution up to 50 per cent of total power, along with 100 per cent sustainable fuel being used in the combustion engine.
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At the 2022 Belgian Grand Prix held in August, then-CEO Marcus Duesmann announced Audi’s F1 entry for 2026. Significantly, three weeks later Porsche withdrew from talks with the Red Bull team over a post-2025 supply deal; and in silencing unanswered questions over the chassis and operations component of Audi’s plan, by late October Ingolstadt declared it would initiate its buy-out of the Sauber F1 team in a phased approach of 25% increments from 2023 onwards, until it holds 75% by 2025. The remaining quarter would remain in the hands of the present majority shareholder, the Swedish Tetra Pak heir billionaire Finn Rausing.
Unbeknown to all at the time, it would not be the last of Porsche and F1’s dalliances. The undertaking to commit to F1 is not to be underestimated. Prior to 2023, no budget ceiling was in place to limit spending for new entrants; with regulated curtailments only kicking in thereafter, permitting Audi to invest $105 million per year in 2023 and 2024, and $100 million in 2025.
To help fund such profligacy, Audi sacrificed its GT customer racing, Dakar Rally, Formula E, DTM and Le Mans prototype programmes. The company has embarked on a major hiring spree and will operate the team from Audi Sport’s Neuberg base which itself will undergo significant facilities upgrades in preparation for the F1 programme. A single-cylinder test engine was already built and fired up by the end of 2022.
With limitless spending allowed for 2022 and $310 million available to invest over three-and-a-half years, Audi are hoping to maximise the time and investment at hand to debut at a competitive pace in 2026.
Yet the cold, hard truth is that when Audi’s rubber hits the road at F1’s first preseason test in 2026, it will be competing with teams – then on equal financial footing – that would by then have benefitted from 12 years of prior turbo V6 hybrid experience with matching billions ploughed into research and development over the same period against Audi’s tally of just four years.
But is it precisely the commencement of the said near-limitless spending, a possible late realisation of the underestimation of the task at hand that holds no guarantee for success, that – if the rumours are to be believed – Audi is considering passing on its F1 pledge?
Smoke in the Cockpit
Even if the aforementioned expenditure yields an engine that is comparable in outputs, economy, reliability and drivability to that of Honda, Mercedes, Ferrari, Alpine and possibly Cadillac, greater question marks continue to loom over the capacity of its chassis.
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Getting the anaemic Sauber to build a Red Bull-beating chassis for 2026 and beyond won’t be the work of a moment. What’s more, the agreed-upon trickle-in ownership (instead of a one-and-done) approach precludes Sauber’s incoming investment by Audi to fully optimise the available time at hand in the run-up to 2026 to develop a race-winning chassis. All the more so when considering the team in its present state slipped to a bottom-rung performer in 2023, and notwithstanding its necessity – the likelihood of additional funding made available by its present owners during its sell-off process being precisely zero.
The missed opportunity of what could and should have been a better-backed development drive by Sauber will be aggravated by Audi having to comply with F1’s cost cap once it participates in 2026; when the avenue to spend itself out of design dead-ends would have been closed.
Should the team then fail to live up to what will be undoubtedly sky-high expectations, it will face the devil’s dilemma of persisting as a wayfaring venture that grates grumpy shareholders, or pulling the plug prematurely to avoid losing further face. Unthinkable? Porsche did just that after just six months in 1991, when its F1 engine programme with the floundering Footwork team proved a flagrant flop.
Boardroom bust-up
Marcus Duesmann was not allowed to stick around for long enough to witness his dream of Audi reaching the promised land of F1. He was given the boot in June last year, hot on the heels of then-VW Group CEO, Herbert Diess, who was sacked a year earlier. Crucially, both were drivers of VW’s F1 participation. Their absence in the boardroom bean-counting battle could be seen as an anchor acting against the required passion of F1 participation.
Diess was replaced by Porsche CEO Oliver Blume; and Duesmann by ex-VW Group Strategist Gernot Döllner, a position he’d enjoyed for a mere three years that followed a 23-year spell at, importantly, Porsche – in various capacities. It is understood that Döllner, keen as the new broom to undo the extravagances of his predecessor who was fired for slumping Chinese sales and slow EV product roll-out – is ready to steer Audi away from F1.
Certainly, from the outset F1 was a square-pegged marketing platform for Audi, bearing in mind its entry into F1 in 2026 coincides with the same year that the company abandons internal combustion engines in all its new road cars. Furthermore, as far as sporting brands meant to lock horns with showroom rivals Ferrari and Mercedes are concerned, within the VW stable Porsche and Lamborghini are both a far better brand fit for competing in F1.
Audi’s F1 efforts, however, would not be in vain. With the prodigious quantity of resources already ploughed into the F1 project by Ingolstadt, the work would continue but is rumoured to at a later stage be rebadged under the Porsche name.
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While plausible, such a scenario is far from feasible. There are practicalities and logistics to consider; to say nothing of the unthinkable optics around such an epically fumbled flip-flop for F1, Audi, Porsche and the greater VW Group. Furthermore, internal competition among the Group’s brands is notoriously fierce, and it’s equally beyond belief that Audi would willingly surrender the fruits of several years of its labour only for what is seen by them as a de facto rival brand – to receive all the credit.
Besides Audi massively losing face, uncomfortable questions would arise over the project’s delayed termination accompanying the already-sunk hundreds of millions already expended. Then there’d also be the annoyance of F1’s incumbent engine suppliers at its ringmasters’ pandering to the VW Group’s every whim (particularly that of dropping the MGU-K, which all of them had spent hundreds of millions on perfecting and were reluctant to abandon), only to now see the primary proponent behind its cessation no longer interested in pursuing F1.
Although any of the above is still to materialise, in the wake of Porsche’s very public courtship and eventual break-up with the Red Bull team in 2022, when viewed through the prism of the VW Group’s chequered history with the sport, the speculation over Audi’s appetite for future F1 participation is strangely completely within character.
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Despite Audi predictably and rigorously denying getting cold feet in response soon after the rumours that started circulating in late October last year, the red flags raised over the project’s prospects, and the tug-of-war between its supporters and wallet-weary detractors in the corridors of power are very real. Just how real these are will determine if the Four Rings are headed straight for F1 success, or end up merely going in circles come 2026.
Find the full feature in the February 2024 issue of CAR Magazine.
