The year 2021 stands as a monumental chapter in Formula 1 history, marked by profound shifts in leadership, groundbreaking regulatory changes, and an on-track championship battle of unprecedented intensity. From a fresh face at the helm of F1’s commercial operations to the crowning of a new world champion, the season delivered drama, controversy, and a renewed sense of excitement that captivated audiences globally.
The dawn of 2021 ushered in a significant change at the very pinnacle of Formula 1’s management structure. Stefano Domenicali, a figure deeply entrenched in motorsport, assumed the crucial role of president and CEO of F1’s commercial rights holder. This appointment signaled a new era for the sport’s business and strategic direction, coming even before the racing season reached its electrifying conclusion.
Indeed, the 2021 racing season culminated in a dramatic crescendo, etching itself into the annals of the sport with Max Verstappen’s hard-fought victory. He was crowned the first non-Mercedes world drivers’ champion since 2013, effectively breaking a seven-year streak of dominance by the German manufacturer. The last time such a feat was achieved was by Sebastian Vettel, then driving for Red Bull, thus bookending an era of Mercedes supremacy with Red Bull-affiliated drivers.
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Amidst the fervor and controversy of the championship finale, another pivotal leadership transition unfolded, though almost overshadowed by the on-track drama. A mere week after Verstappen’s contentious victory, Jean Todt concluded his tenure as FIA president. Having reached both the stipulated three-term limit and the maximum permissible age of 75 for re-election, Todt stepped down. His successor was Mohammed Ben Sulayem from the United Arab Emirates, a significant appointment marking the first non-European to hold the top job in world motoring since the federation’s establishment in 1904. This historic change not only diversified the FIA’s leadership but also heralded a new perspective for the sport’s governing body.
The transition of power within the FIA extended to its influential World Motor Sport Council (WMSC), which underwent drastic restructuring. Traditional motorsport powerhouses like Germany, France, and Italy saw their long-held delegate seats vanish, positions many had considered unassailable. Intriguingly, one of these newly available seats was filled by Fabiana Ecclestone, wife of the former F1 supremo Bernie Ecclestone. While official statements suggest the nonagenarian former F1 boss will have no direct say in WMSC affairs, insider speculation widely suggests that his influence, through his wife, could still be considerable, adding another layer of political intrigue to the sport’s governance.
Stefano Domenicali’s appointment as F1 CEO had, in fact, been exclusively reported by RaceFans in September 2020, generating considerable anticipation for his official start date. This eagerness was not a reflection of dissatisfaction with the outgoing CEO, Chase Carey, who was widely credited with bringing much-needed stability to the sport. Quite the contrary, Carey had adeptly steered F1 through years of perceived profit-extraction under the previous commercial rights holder, CVC Capital Partners. His mission had been one of consolidation and stabilization. With that foundation laid, the time was ripe for F1 to enter a new phase, to “move up another gear,” and Domenicali was seen as the ideal leader to drive that forward momentum.
Carey’s legacy was largely cemented by his success in implementing a thoroughly revamped Concorde Agreement. This critical document, which dictates the financial, sporting, and regulatory framework of F1, was presented to teams on a definitive ‘take-it-or-leave-it’ basis. As expected, there was initial resistance, particularly from Mercedes F1, who sought to defer matters for a year. However, Carey remained resolute, holding firm to his stance, which ultimately led to the covenant being signed by all ten teams in August 2020, with an effective date of January 1, 2021. This new agreement was designed to foster greater financial parity and ensure a more sustainable future for all participants.
In parallel with the new Concorde Agreement, the FIA introduced a stringent formal budget cap, set at $145 million for 2021. This cap was scheduled to decrease incrementally by $5 million annually in 2022 and 2023, with subsequent reviews planned. This financial regulation delivered a significant “triple whammy” to the sport’s major teams. Not only were they compelled to downsize staff and reduce their vast resources, but they had to achieve this while simultaneously competing with updated versions of their 2020 cars in 2021, and critically, developing entirely new cars for the radical ‘new era’ regulations slated for 2022. It was a complex and demanding balancing act, forcing the biggest spenders to re-evaluate their entire operational model.
Indeed, a watershed year was rapidly approaching. The longstanding, eight-year-old formula was set to be replaced by a much-touted ‘new era’ of regulations, promising more exhilarating on-track action at considerably lower costs. Originally earmarked for 2021, its implementation was delayed by a year due to the global Covid-19 pandemic. Ironically, the 2021 season, run under the existing regulations, delivered an unexpectedly thrilling championship battle, producing the first points tie heading into the finale since 1974. Following seven years of Mercedes’ unchallenged dominance, some observers questioned whether these radical new regulations were truly necessary after such an enthralling season.
The counter-argument, however, highlights the extensive lead time required to frame entirely new regulations. Such a comprehensive overhaul typically demands at least two years – the prescribed minimum period when the performance balance between competing automobiles is significantly impacted. Furthermore, back in 2019, when the 2022 regulations were being conceptualized, no one could have possibly foreseen that the 2021 season would unfold as one of the most dramatic in three decades. This raises the question of how Stefano Domenicali, as F1’s new leader, perceives this situation and the ongoing relevance of the impending rule changes.
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In an interview with RaceFans in Abu Dhabi, Domenicali articulated his vision for the future, emphasizing the strategic importance of the upcoming regulatory changes. “The 2022 regulations will provide a crucial additive for the championship,” he stated. “While 2021 has been incredible, we still have cars that cannot follow each other closely [due to current aerodynamics]. The new regulations were delayed a year but they are designed to improve the racing, allowing for more wheel-to-wheel battles and reducing the negative impact of turbulent air.” This perspective underscores the long-term goal of fostering sustained competitive racing, rather than relying solely on the serendipitous drama of a single season.
Beyond the aerodynamic overhauls, the 2021 season also marked a significant departure in tire technology. It was the final year for F1’s iconic 13-inch rubber, a dimension that had been standard since 1985. This was replaced by new, lower-profile 18-inch tires, a change aimed at increasing road relevance and improving the aesthetic appeal of the cars. How these new tires will ultimately perform under race conditions remains an open question, as direct comparative testing was impossible. They were evaluated on ‘mules’ – F1-speak for test cars often modified to simulate new regulations without fully revealing future car designs. Pirelli, the sole tire supplier, remains optimistic, projecting superior performance across all conditions and a closer resemblance to consumer road car tires, despite an undesirable increase of 14kg to the overall car weight. This additional weight presents a fresh engineering challenge for teams in the new era.
F1’s revised prize money structures, designed to ensure greater financial equality among teams, will take at least three years to fully permeate the system. While the top three performing teams will continue to receive performance bonuses and Ferrari retains a reduced historic stipend, the overarching aim is to level the playing field. Despite this gradual implementation, the immediate effects were noticeable: leading teams like Mercedes, Red Bull, and Ferrari openly admitted to scaling back the number of upgrades they introduced as the 2021 season progressed, a direct consequence of the new budget cap provisions. This early impact demonstrates the budget cap’s effectiveness in curbing runaway expenditure and encouraging more strategic resource allocation.
Furthermore, the revised governance system, which granted all teams equal voting rights – with the notable exception of Ferrari retaining a diluted form of its historical veto power – proved instrumental during the 2021 season. This streamlined decision-making process allowed the FIA to expedite crucial rule clarifications. Consequently, contentious issues such as pit stop regulations and the provisions governing ‘flexi-wings’ were “clarified,” which effectively meant they were “considerably tightened” mid-season, rather than being deferred until the subsequent year. This swift action demonstrated a significant shift in power dynamics, effectively clipping the wings of major teams who had previously exerted greater influence over rule interpretation and implementation.
Despite these positive strides in governance, a discernible lowlight of 2021 was F1’s failure to commence its much-anticipated comprehensive rewrite of its existing regulations. There had been prior commitments to streamline these provisions, with a particular focus on eliminating conflicting clauses, especially those embedded within the sporting regulations. While such an extensive revamp cannot be completed within a single year – particularly if approached with the necessary diligence – the longer this critical overhaul is delayed, the greater the probability of a recurrence of the controversies and ambiguities that marred the Abu Dhabi season finale. The imperative for clearer, more robust regulations remains a pressing concern for the sport’s integrity.
To put it plainly, the 2021 season was riddled with too many inconsistencies, raising legitimate questions even among the most fervent fans. This led to uncomfortable speculation about whether Liberty Media, as F1’s parent company and ultimate holder of commercial rights, and Netflix, the producer of the massively popular series Drive to Survive, had potentially compromised or even “hijacked” regulatory control of the sport for entertainment purposes. These concerns were not without some justification, especially in light of reports such as Max Verstappen’s refusal to participate in the ‘fake’ Drive to Survive Netflix series, underscoring a growing tension between sporting integrity and commercial storytelling.
Another contentious development in the eyes of many, though generally welcomed by promoters and broadcasters, was the introduction of sprint qualifying races. These shorter Saturday races, designed to inject more excitement into Grand Prix weekends, appear to be a permanent fixture, with six events already scheduled for the 2022 F1 season. However, the overall concept and format of sprint races are continuously evolving. Liberty Media, the FIA, and team bosses are actively collaborating to refine the solution, seeking a format that maximizes entertainment and sporting fairness, as reflected in the ongoing discussions reported here: F1 has only worked out one thing about sprint qualifying: It wants more.
As the 2021 season unfolded, the intense rivalry between Mercedes and Red Bull, characterized by considerable “catfights” and continuous bickering, escalated precisely as expected in a championship as tightly contested as this one. Throughout this escalating tension, the calm and steady hand of Stefano Domenicali was palpable. Having previously served as team principal for Ferrari, he possessed the unique advantage of having once been ‘one of them,’ understanding the intricate dynamics of team politics. He worked diligently behind the scenes, often unnoticed, intervening whenever the flames of dissent threatened to engulf the sport and undermine its integrity, a testament to his diplomatic skills and deep understanding of F1’s ecosystem.
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McLaren Racing CEO Zak Brown offered a candid assessment when RaceFans asked him to rate Domenicali’s inaugural year in office. “Stefano is charming, he’s Italian, he’s friendly, but don’t be mistaken,” Brown cautioned. “Underneath that charming, likeable guy there’s an immense amount of drive and toughness, and that’s been good for all of us.” This sentiment highlights Domenicali’s blend of affability and resolve, crucial traits for navigating the complex world of Formula 1 stakeholders. He has been instrumental in finalizing new commercial agreements, expanding the race calendar, and driving new media partnerships.
Brown further elaborated on Domenicali’s impact: “He’s been able to get things over the line, he knows all the characters. There are new races coming, new TV deals coming, sprint races, trackside partnerships. He’s picked up the baton from [Carey], and he’s sprinting with it.” The pun, presumably, was not intended, but it aptly captures the rapid pace and assertive direction Domenicali has brought to the sport’s commercial expansion and strategic development.
Aston Martin team principal Otmar Szafnauer echoed similar appreciation for Domenicali’s achievements in his first year. Szafnauer singled out the sell-out US Grand Prix as a stand-out moment, a testament to F1’s burgeoning popularity in North America. The former Ford USA executive fondly recalled the incessant requests he received from his Detroit associates, all desperate to secure tickets for the event, highlighting the intense demand and growing market penetration. Szafnauer attributed some of this success to the “Netflix effect” of ‘Drive to Survive’, but critically noted that “Stefano is taking that and turning it into what we need to do. He’s found opportunities to build on and exploited others and is doing a great job.” This demonstrates Domenicali’s ability to capitalize on existing momentum and forge new avenues for growth.
The tangible evidence of F1’s burgeoning success under Domenicali’s leadership is reflected powerfully in its share price. On the day Domenicali first took office, the Formula 1 Group (FWONK) stock was valued at $40.74. As of 51 weeks later, the stock was trading at an all-time high of $62.60. This represents an appreciation of over 50% within a single year, a remarkable feat achieved despite the persistent disruptions caused by the Covid-19 pandemic, which saw one round removed from the calendar, the fallout from the contentious Abu Dhabi finale, and persistent rumors about Lewis Hamilton’s potential retirement. This financial performance underscores the strong market confidence in F1’s current trajectory and leadership.
In early July, we at RaceFans confidently predicted Valtteri Bottas’s move to Alfa Romeo – a revelation met with considerable disbelief at the time, even from senior team executive Pascal Picci, who subsequently departed amidst controversy. Our report further indicated that George Russell was a clear shoo-in for the coveted Mercedes seat. Significantly, Lewis Hamilton’s contract extension with Mercedes was signed that very same weekend, notably before the public announcement of Bottas’s departure, whom Hamilton had publicly lauded as “the best team mate I’ve ever had.” This sequence of events raises intriguing questions: Could Bottas’s impending exit, rather than solely the contentious Abu Dhabi fallout, be the true underlying reason for Hamilton’s subsequent doubts about his future? This theory gains traction particularly as Hamilton later admitted to not possessing a veto over his team mate selection, suggesting that the team’s decision might have played a larger, unspoken role in his considerations.
While there were uncertainties surrounding Hamilton’s future, there were never any doubts that Kimi Raikkonen would retire at the end of 2021. The ‘Iceman’ concluded an extraordinary career, having entered F1 as one of its least experienced car racers, with just 23 single-seater starts on his CV. He departed with the unparalleled record of 349 F1 starts, a tally likely to be surpassed by Fernando Alonso in the near future. Intriguingly, both Raikkonen and Alonso made their F1 debuts at the Australian Grand Prix in 2001, both went on to become world champions, and both took sabbaticals from the sport to compete elsewhere, adding another layer of parallel between these two iconic figures.
During the British Grand Prix weekend, RaceFans exclusively revealed that Formula 1 was in advanced discussions with Qatar for a new race. While a longer-term deal was on the table, the Gulf peninsula would sit out the 2022 season due to scheduling conflicts with its hosting of the FIFA World Cup. Remarkably, the inaugural Qatar Grand Prix came to fruition in November, a mere four months from the commencement of initial talks to the start of the race – a logistical feat that surely stands as a record in itself.
Further adding to the intrigue of F1’s expanding global footprint, Qatar holds a significant 17% shareholding in the Volkswagen Group. This German automotive giant is currently giving serious consideration to entering Formula 1, potentially through one or both of its prestigious Audi and Porsche brands. Just last week, we disclosed the existence of a letter from Audi CEO Markus Duesmann to the FIA and F1, stating that a definitive decision on their F1 entry would be made in early 2022. This potential entry represents a massive coup for F1, bringing a new level of manufacturer interest and investment.
One of the primary preconditions set by the Volkswagen Group for its potential entry into F1 was the abolition of the MGU-H (Motor Generator Unit – Heat). This component, a massively complex and eye-wateringly expensive piece of technology, has become increasingly irrelevant to modern road car manufacturers, driving up costs for both engine suppliers and competitors. The agreement to scrap the MGU-H from the next generation of power unit regulations was reached at the last full World Motor Sport Council meeting of the year. This crucial concession opens the door wider for new manufacturers, and the motorsport world now eagerly awaits to see which direction VW Group will ultimately take, and whether Audi or Porsche, or both, will indeed jump into the exhilarating world of Formula 1.
Last year, Honda made the decision to exit the sport, and their timing, as is often the case with the Japanese manufacturer, proved impeccable. Having secured its first world championship in 21 years with Max Verstappen, the company that has long professed its love for racing chose to depart at the absolute pinnacle of its recent success. This decision meant they would no longer be able to directly leverage Verstappen’s hard-won title for marketing or brand purposes, creating a bittersweet moment for fans and the wider sport.
However, a deeper look reveals a more nuanced reality: Is Honda truly leaving F1, or merely doing so in name only? RaceFans understands that Honda will continue to supply unbranded engines from its Sakura base in Japan to Red Bull Racing and its sister team AlphaTauri until the end of the 2025 season. While this arrangement will come at an inflated fee, it will nonetheless prove to be a more cost-effective solution than Red Bull Powertrains independently establishing and ramping up its manufacturing and rebuilding capabilities for power units, especially considering that the necessary facilities and expertise already exist within Honda in Japan. This strategic partnership ensures a degree of continuity, allowing Red Bull to transition into its own power unit program without immediate, prohibitive investment.
Finally, 2021 also marked a poignant year as Formula 1 bid farewell to two truly iconic characters who profoundly shaped the sport. We mourned the loss of Max Mosley, the controversial yet enigmatic former FIA president, whose influence on safety and governance remains undeniable. We also said goodbye to Sir Frank Williams, an arch-racer and knighted figure celebrated for his immense contributions to motor racing, despite overcoming formidable odds throughout his life. Both individuals, though in vastly different fashions, left an indelible mark on F1. There is no doubt that the sport would be an utterly different landscape without their respective involvements and unwavering dedication. Sir Frank Williams, in particular, with his enduring spirit and pioneering team, is sorely missed by the entire Formula 1 community.
Against the backdrop of the omnipresent disruptions of the Covid-19 pandemic, Formula 1 in 2021 delivered a spectacle far greater than anyone had a right to expect. The significant changes at the top echelons of the sport, both politically and commercially, neatly bookended a season that masterfully blended political drama, intense on-track action, and gripping sporting intrigue. The season climaxed with two protagonists – a seasoned veteran driving the sport’s most dominant car versus a rising star given his first real shot in top machinery – entering the final race level on points, an unprecedented and thrilling scenario that captured the world’s imagination.
As a direct result of this captivating season – and despite the controversial eventual outcome – all of F1’s key metrics surged in the right direction across most major markets, notably experiencing significant growth in the USA and Asia. The 2022 championship, with its radical new regulations and renewed sense of optimism, will be hard-pressed to outdo the drama and excitement of the season just past. However, this is a perennial challenge with unexpected classics. Who, just a year ago, could have possibly foreseen how 2021 would ultimately pan out, setting such a high benchmark for the sport’s future?
Indeed, the upcoming season will find it incredibly challenging to merely equal 2021, let alone surpass it. Yet, if it somehow manages to deliver another season of such unparalleled excitement and growth, then betting against the F1 Group’s stock (FWONK) hitting the $100 mark would undoubtedly be a fool’s wager, symbolizing the sport’s truly remarkable resurgence and bright future.
RacingLines
- The year of sprints, ‘the show’ – and rising stock: A political review of the 2021 F1 season
- The problems of perception the FIA must address after the Abu Dhabi row
- Why the budget cap could be F1’s next battleground between Mercedes and Red Bull
- Todt defied expectations as president – now he plans to “disappear” from FIA
- Sir Frank Williams: A personal appreciation of a true racer
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