McLaren Wining Helping To Stabilize Company Finances

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The switch over at the top is almost complete with McLaren falling short by 8 pots currently. Most experts predicted this would happen around about the time of the Canadian Grand Prix which is 2 races away. The next race is in Baku and unless Red Bull change their car they will be in second spot.

Whichever team dominates Formula One becomes a money printing business because after the cost cap which was introduced a few seasons back these teams have become big business. In the past most teams operated at a loss ad it was more about being a marketing arm for those companies involved.

McLaren last season scored a grand total of 302 points which is $302 million in real value with 1 championship point valued at $1 million. With 8 races to still to run they are already better off to the tune of $136 million.

McLaren needed a financial boost to their earnings due to falling on hard times for the last 5 years. Last year the company lost in the region of $900 million which was almost double that of their 2022 loss. The company has had to retrench over 1200 employees plus sell off their head quarters along with the historic McLaren car collection.

The Formula One team winning is the best marketing McLaren could ever have as race wins normally mean a boost in sales. This is exactly why the likes of Mercedes and Ferrari would like to reclaim the top spot for themselves. The only way this ever happens is if the teams are at the top of their game when it comes to technology and applying new upgraded developments to their car.

The other bonus besides the prize money being earned is that a winning car can charge more for advertising space. Last season sponsors paid over $120 million and when they claim their constructors trophy this season that number will rise significantly. A team like Mercedes raises around $170 million per season and Ferrari earning a whopping $250 million which highlights companies wanting to be seen on the top performing cars.

The cost of running a Formula One team is not cheap and the prize money along with the advertising cover their costs with whatever being left over considered as profit. If you consider the team flies out to these races and arrives in advance in order to set up plus also needs to dismantle and pack away every item afterwards.

Last year Red Bull spent $140 million, Mercedes $131 million, Ferrari $122 million and McLaren $113 million so the costs are large ad this season more races have been added to the calendar year increasing those costs. If you are out front winning races or finishing high on the podium the costs are negligible as there is big money for the top 3 cars. The breakdown is as follows 25 for the win followed by 18,15,12, 10, 8, 6, 4, 2 and 1 for 10th spot.

A dominant team in theory if they wo all the races throughout the year plus finishing second including earning the bonus of the fastest lap which is one point could earn up with over 1 billion dollars earning $1056 Million. Mercedes scored a staggering 765 points during the 2016 season which was big for back then because these days there are far more races and the competition is much closer. McLaren could still break the 700 point barrier this season which will go along way into settling the losses incurred by the company over the last 5 years.

Posted Using InLeo Alpha