SLIM
PICKINGS
Renault’s sojournas anenginesupplier
never de livere d the returns expected. Tensions
built between Red Bull and itspart ner even when
their relationship was at its most successful;
Rena ult felt it never gotthe cr edit or publicity it
deserved,espe cially sinceRed Bull’s narrative
of choicewas one of success againstthe odds,
of car-designgenius overcominga sho rtfall in
horsepower. Red Bull resented having topay
for engines, resultingin Renault arranginga
sponso rship deal with Infiniti, the Renault-Nissan
Alliance’s luxury car brand. But this was mutually
dissatisfactory, since it meant Renaultwas
effecti vely paying for itsown enginesand further
reducing its exposure, whileRed Bull felt the
value – US$30million a year – was less th an the
Infiniti brand ing on its cars was worth.
Divorce became imminentafte r Renault’s
first two attempts at a hybrid engine proved
disastrous. Having pioneered turbochargingin
F1 in 1977 and poweredmany championsin th e
interim, thecompany co lossally overestimated
its ability todelive r a co mpetitivesolution.
Viry, denuded after the 2007cutbacks,was
comprehensively trumped by Mercedes – which
had been developingits h ybrid engine for four
years and conquered many of thepitfalls Renault
spent 2014and 2015 (perhaps also 2016, 2017
and 2018)encountering.
As Renaultgrasped the reality thatits life as an
enginesupplier was a lose-lose situation, it began
to consider itsopti ons – to quit entirely orreturn
as a ful l-blownmanuf acturer. Itchose the latter,
after much bluster and protracted negotiations
with Ecclestone as well aspotent ial suitors. This
delay would provecostly.
Through 2015 Renault sizedup three teams,
accordingto managing director Cyril Abiteboul.
One of these is known to be Toro Rosso, undera
deal briefly on th e table as Red Bull and Renault
tried tosettle their differences amicably, and the
other was Sauber. Itsformer operation atEnst one
emerged as the preferred option, even if it was
heavilyinde bted and a shadowof its former self.
“When we wereputting togetherthe plan,
lookingat whether we were able to respond
positively to thecondit ionsset by Renault’s
management, we looked in detail ata num ber of
teams,” says Abiteboul.“We benchmarkedthree
possible teams. We looked at the pros and
cons of each one. Sowhen we walked into
Enstone we were completely familiar with
the strengthsand weaknesses of theplace.
“We alsobenchmarked the top teams and
have a good relationship withMerc edes. We
were able toexchange somefigures andhad
a senseat the time o f what was necessary to
compete atthe level of a topteam.”
The Mercedes comparison isinstru ctive.
It bought the downsized Brawnteam at the end
of 2009 on the understandingF1 was about to
enter a budget-capped,resource-restricted future.
That nev er happened, forcing Mercedesto double
down on itsinvestment or be a bit-part player.
The strategy eventually worked, but tookthree
seasons and cost RossBrawn his jobas TotoWolff and Niki Lauda assumedcontrol andthe
Mercedes board grew impatient.
Carlos Ghosn spentmuch of2015 living up to
his reputation asa de almaker, playing hardball
with Genii and Ecclestone. Key sticking points
included thefuture of the Re d Bull engi ne supply
and the length of Renault’s commitmentto F 1.
Since F1 itself was up for sale,Ecclestone needed
a big nametied in beyond theend of the cur rent
Concorde Agreement, and didn’t wantone of the
sport’s bighitters left without anenginedeal.
“The payback as an engine supplier proved to
be limited,” saidRenault’sstatement announcing
the deal in late2015.“The return on in vestment
necessitated by the new engine regulationsand
the return in terms of image were low.”BILLION-DOLLAR
BABYF1 team budgets are trickyfor outsiders
to pin down accurately – while Renault Sport
Racing is a limited company which files publicly
available accountsto Companies House in the
UK, those figures won’t reflect Renault’s overall
spend since theydon’t include Viry. But the
published accounts reveal Renault in effect
paid a nominal sum of £1 to reacquire its old
team, along with debts equivalent to around
US$140million, which had to be settled.
In subsequent seasons its operatingbudge t
has been in the region ofUS$170million (2016),
US$195m illion (2017) and US$180million (2018).
This season it expects to spend US$190million.
Factoring in investment in new facilities atViry
and Enstone, this brings thespend so far – not all
from Renault coffe rs, since sponsor income and
prize money are also inthe mi x – into theregion
of a billion dollars. But to what end? Theteam is
already strugglingto fulfi l its goal of returning to
championship-contendingform within fiveyears.
Had the Lotus acquisition been tied up in
summer 2015, Renault could have gone into ’16
with a new car. Instead the deal didn’t get over
the line until late December, tying the team intoWEBENCHMARKEDTHREEPOSSIBLETEAMS.WE
LOOKEDAT THEPROSANDCONSOFEACHONE.
SOWHENWEWALKEDINTOENSTONEWEWERE
COMPLETELYFAMILIARWITHTHESTRENGTHS
ANDWEAKNESSESOFTHEPLACE
CYRIL ABITEBOUL”
”
Renault’searly
attemptsatahybrid
enginewerealong
waybehindtheefforts
ofMercedes